EU outlines copyright laws that could hit tech firms

EU copyright laws may hit tech firms

Technology companies from Netflix and Spotify to Google and Yahoo could be affected by wide-ranging copyright legislation proposed by the European Union's executive arm on Wednesday.

Under the laws, consumers traveling in the European Union (EU) would be allowed to access digital services such as streaming music or films, anywhere within the 28-member bloc. Currently, copyright restrictions mean a German user of Netflix who travels to the U.K. for example, will only be able to access the content that the video streaming service offers in Britain.

The proposals will be outlined in greater depth next year and form part of a push by European Commission for the so-called Digital Single Market, where citizens and businesses can access online services regardless of where they live..

"People who legally buy content – films, books, football matches, TV series – must be able to carry it with them anywhere they go in Europe," Andrus Ansip, vice president for the Digital Single Market, said in a press release.

The rules enabling access to content regardless of location will matter specifically to people on business trips or holidays. They would however not be allowed to shop for better subscription deals in other countries.

Sports would also be included in the proposals. If someone has a subscription to a TV provider which also offers the ability to watch live TV online, this could come under the EU law. Given that sports rights deals are often expensive to acquire and are hammered out on a territory by territory basis, this could worry certain providers like BT and Sky in the U.K.

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"We will need to consider the plans in detail but we welcome anything that helps customers get even more value from their subscriptions. We look forward to working with the commission to ensure that the proposals are part of a robust framework that supports investment in European content," Sky told CNBC in a statement.

BT said it wants to "work constructively" with the EU institutions, adding that "it is important that the proposal has clear definitions around the authentication, period of use, quality of service and number of concurrent users of any such content and also who will cover the cost".

Netflix told CNBC it is committed to offering members "great programming wherever they are and are studying the EU's proposal".

Spotify is unlikely to be affected as users can save music offline and access the service anywhere in the world.

The EU said that the changes would lead to "marginal costs" for service providers but that the benefits would "largely outweighed" this.

The European Parliament and the member states still need to approve the proposals with the Commission anticipating that this will become law across the EU in 2017.

Experts suggest that passing the law won't be plain sailing, given anticipated kickback from services that will be affected by the law.

"While there is broad agreement that changes need to be made, copyright holders will likely have strong views on the proposals as they stand, which will no doubt feed into what the member states' view might be when the proposals go to the European Parliament," Aline Doussin, senior associate at Squire Patton Boggs, told CNBC by email.

News aggregators in EU crosshairs

Another key aspect of the proposals is what the EU wants to do to with news aggregation services like Google News and Yahoo News.

"News aggregators, for example, are not only using hyperlinks but also extracts of articles and may gain revenue doing so," the EU said in a question and answer document about the legislation.

Last year, Google News shut its Spanish service after the government planned to pass a law requiring news aggregators to pay publishers for linking to their content. This is an idea that has been entertained by other member states and pushed for by European content providers.

"The internet creates tremendous opportunities for news publishers to reach more readers - but it also brings challenges. A tax on snippets is not a viable answer to those challenges, as experience in Germany and Spain shows - it isn't good for publishers or users. We're working closely with news publishers to drive traffic to news sites and apps and to find more sustainable models for journalism online," Google told CNBC in a statement.