Is Brexit the End of the European Digital Market?

One of the biggest developments in the online world, particularly for European marketers is that of the EU’s aim to establish a single digital market.  It makes sense, the digital market grows every year and is now worth billions of Euros across the continent yet there are still very few laws and regulations which operate across Europe.

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For example you can pay a subscription for a digital service like Netflix and then find you cannot access it when you are in a different country.  The same goes for thousands of digital products particularly those which rely on the internet for a delivery mechanism.  Your physical location and your digital purchase are linked, in some extents you’d actually have to buy the same product repeatedly in different countries in order to use them.   This crazy situation is simply because the digital market although growing exponentially is fragmented, unregulated and completely disorganized across geographical borders.

There are many reasons why this has happened, at the core of the problem is simply that the digital market is being run using laws and regulations which are simply not suited to this sector.  If you buy a computer from your local store and it turns out to be faulty it’s simple to take it back and request a replacement or fix. there are both national and Eu regulations which protect  your rights.  However buy a digital product from an online retailer based on the other side of Europe and it becomes much more complicated.  Especially as sometimes national laws in the different countries conflict, which should take precedence the buyer or sellers nationality?

It’s easy to ignore these problems which on the whole is what most retailers are doing.  Worst still many are exploiting these problems and using them to maximise their profits at the expense of consumer rights.  There are numerous examples of companies applying notional physical boundaries to the digital world simply in order to make more money by selling at different prices to different market – a concept called price discrimination.

The EU was trying to change all this, by ensuring the digital market became as open as the physical market.  There were already plans for digital providers to put in solutions to ensure that European consumers were entitled to access wherever their location.  The BBC were looking at integrating authentication into their BBC iPlayer service to ensure that any license fee payer would have access to the service irrespective of their location.  Now this attitude seems to have changed with the corporation enforcing their VPN block on the BBC – read this instead of ensuring open access to fee payers.

Without the European driving force it may be that the single digital market takes considerably longer to achieve, yet it will happen eventually.  Whether it happens in the rest of Europe and the UK joins in or perhaps it will continue to follow the process during the protracted Brexit process, nobody is entirely sure. The pressures will come from some area, whether from legislation or commercial pressures.  In the areas of digital content like books, films and media it is too easy to pirate and copy content from other sources.  If the legitimate market becomes too expensive or difficult to use then people simply start using pirate sites, torrents and usenet feeds which all allow access at the click of a button.

Further Reading:

James Collins, Netflix Blocking VPNs and Proxies, 2016

 

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