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The fallacy of content quotas

I’ve become somewhat of a streaming junkie during this pandemic, following up on the criticism that my pop-culture knowledge is sub-optimal. Now subscribed to three services at once, I watch both popular movies and TV shows from the U.S. and niche local productions buried in the dark corners of Netflix. On these platforms, content curation is everything. The algorithm feeds me with matching shows and the search bar helps me identify titles most fitting for what I’m into.

Though I’m satisfied, some regulators are unhappy with the amount of local artistic content on these platforms. “In order to increase cultural diversity and promote European content, the new legislation proposes that 30% of content of TV channels and VOD platforms would have to be European,” said a European Parliament press release from 2018. But putting “Europe first” on Spotify and Netflix is problematic for a number of reasons.

On the one hand, legislators intervene with broadcasting companies’ freedom to pick their own content. At present,  they choose which content they deem most interesting and valuable for their customer base. It’s difficult to imagine that streaming services would find no value in making local content, given that they are competing with TV broadcasters who cater to this market. Added to that, calling these content quotas “supportive” of the cultural sector is a misnomer because it is unlikely actually to support local productions.

Take Netflix as a case study. American users have access to 100% of Netflix titles, which makes intuitive sense. However, through a mix of copyright rules that enable geo-blocking and content quotas, European Netflix subscribers get a rotten deal. Of all EU member states, Lithuania gets access to the largest share with 52% of titles. With only 11%, Portugal gets the worst experience for subscribers. The idea that content quotas will automatically boost local film production is utopian — it is just as likely that streaming services will reduce the overall available titles to match the quota without needing to spend additional funds.

Politically, the move is deeply un-European. These quotas – which also exist on national levels – have been introduced and reformed by mainstream political parties. Still, it’d hardly be controversial to claim that had Marine Le Pen suggested them, while having French flags in the background, we’d think very differently of this policy. It would be labelled nationalistic, and rightfully so.

For some reason, EU legislators escape this judgement because now it’s being executed on a continent-wide level. But on what basis could anyone in the European Union argue that consuming European audiovisual content is in any way preferable to a movie from South Africa or a song from Malaysia? Is this the European equivalent of supporting cultural diversity, supporting audiovisual access for our expat communities, and assisting content creators in developing nations?

Yes, the United States indeed dominates the streaming markets with its films and its music. The question is whether we — or any other country for that matter — is right in believing that boosting our cultural sector happens if we force broadcasters to favour our content by law. The EU is the most significant consumer region on the planet; if anything, it should be easier for our content providers to satisfy the need for local music and films.

Most of all, European legislation is all too often the domino that creates a chain reaction. Mexico is currently debating new rules that would require a national content quota of 15% (“content or video generated by an individual or corporation with a majority of funding of Mexican origin”). However, this initiative overlooks the fact mentioned above; that the EU is the largest consumer region in the world.

The synergies obtained from an economic bloc the size of the EU are not the same from an individual market. And even if the EU regulation allows the production from over 40 countries to be considered for the quota – the chain reaction amplifies the insidious effects of the legislation rather than promote the so-called cultural benefits. In the end, consumers will be left with less diversity of content as producers would reduce their catalogues only to comply with the regulation.

Content quotas reduce consumer streaming experience, they unfairly discriminate against foreign productions, and they do not achieve the goals they were set out to achieve. If we were empowered to rate public policies on an IMDb equivalent platform, this would get a 0.0/10.

Originally published here.

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