Brexit will hit media and entertainment industry

Study shows

Senior executives from the media and entertainment industry are counting on a smooth Brexit, according to a new report from global law firm, DLA Piper.

The report, based on an international survey of 246 in-house counsel and senior media executives and a series of interviews, showed almost seven in ten (69%) UK-based respondents had concerns around the impact of Brexit on their business.

Within that group, 40 per cent said that their main concern around the Brexit process was access to the single market, while 30 per cent said that their priority was clarity around how licencing models will be affected across territories. 15 per cent stated that their priority was clarity around the judicial system.

The report comes at a time when media companies are announcing record levels of investment into online content to distribute outside their home markets. With 82 per cent of all respondents to the survey stating that over-the-top (OTT) content was a major growth area for their business, it is clear that the Brexit process will impact the entire industry, both those importing to and exporting from the UK.

Under a hard Brexit, there will be no ‘passporting’ of Ofcom-regulated services into Europe, as is currently provided under the Audio-Visual Media Services Directive (AVMSD), which includes on-demand content developed specifically as add-on services, beyond linear scheduled broadcasting.

Alternatively, companies will need to set up operations sufficient to comply with the AVMSD in another EU member state to ‘passport’ their services throughout the EU. While several broadcasters have taken steps to do so, the process requires significant investment.

Nick Fitzpatrick, Partner and Global Co-Chair of Media, Sport and Entertainment Sector, at DLA Piper:

“The message which emerged, loud and clear, from our research is that many media companies in the UK and elsewhere think a hard Brexit may cause significant immediate damage, undermining the harmonisation the European Digital Single Market Strategy had intended for the media and entertainment sector.

“Although the EU Withdrawal Bill will convert many European laws into UK law, there are likely to be a number of areas where previously harmonised laws may ultimately diverge, impacting broadcasters across the board – from advertising, to listed events to on-demand services. 

“The boom in streaming platforms and the corresponding content production arms race has been nothing short of a revolution in the media industry, transforming the landscape, expanding competition and globalising media platforms. Consumers around the world will continue to demand exactly what media they want to watch, exactly when they want to watch it. Media companies will have to work closely with regulators to make sure they get the deal they want.”

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