Brussels, 20 September 2005
What is the economic importance of the publishing industry?
Publishing accounts for some 0.5% of European GDP across the EU25 Member States, with yearly output valued at €121 billion and value-added amounting to €43 billion in the pre-May 2004 Union of 15 Member States, according to the most recent figures. Publishing provides some 750,000 jobs in 64,000 companies across today’s 25 Member State Union. The rest is contributed by 50,000 other smaller companies, a considerable force for diversity.
Newspapers are the largest sub-sector – some 37% of output – followed by magazines and journals (32%) – and books (25%), the balance accounted for by directories and databases derived from them.
Why do we need a healthy European publishing industry?
Publishing is a tremendous force for diversity. Around 64,000 publishers across the EU contribute to the industry, across 4 different segments. It is important that publishing finds sustainable business models so that it can prosper on-line.
The free press has long provided a forum for political news and debate. Even now, with many people relying on television for news, the press contributes a depth and diversity to debate, which cannot be achieved within the constraints of a TV schedule. Unlike in broadcasting, there is no licensing regime requiring impartiality, which means that there is potential for a title to represent a particular political view. Assuming that all points of view are covered across the market by different publishers, there need be no concerns over media pluralism.
The magazine sector also contributes political debate, while offering a range of special interest publications that enrich the leisure activities of our citizens. This is probably the most dynamic sector of the publishing industry over the past ten years in terms of growth in the number of titles.
Books are the first medium, dating back to Gutenberg. They are still the primary means for transmitting ideas and culture across generations and through the ages. So far, no generally accepted electronic book format has emerged. The industry awaits low-cost displays able to match the ease of use and low cost of paper. Public policy should support the migration of book publishing to the on-line environment, in line with market and technological possibilities.
The directories and databases segment has made the most progress towards migration to the on-line world. Most business-to-business directories are already on-line, with consumer directories following, as the on-line market develops.
What are the challenges that the publishing industry is facing?
Publishers need revenues in order to sustain their businesses – and the flow of social and cultural benefits which a successful and diverse publishing industry delivers, normally, without much intervention from public policy. The challenge is to develop sustainable business models for the on-line world, to ensure revenue streams. This is a challenge on several fronts. First, publishers need to overcome the idea that “content is free” on the internet. Internet and the web will always offer a “Digital Commons” where anyone can publish an item and make it freely available. But unless consumers pay for commercial content (which includes music, movies, and printed press content), the supply is likely to dry up. Developing that market place is a core challenge, and attractive business models with user-friendly pricing and access technologies are essential to success. These are commercial issues for the publishers themselves. Public policy can help them by ensuring adequate legal protection for intellectual property rights in the on-line world and by promoting debates on horizontal issues like Digital Rights Management technologies.
Capturing growth is the challenge. The opportunities for publishers are potentially huge, notably the chance to tap new revenue streams from on-line advertising. They are as wide-open as future technological developments themselves. There is potentially a win-win-win situation for advertisers, publishers and consumers as new advertising techniques develop. Advertisers and publishers will have more effective advertising, thanks to click-through responses from consumers which will enable them to measure the effectiveness of their advertising more easily than in traditional print media. Consumers will increasingly be able to choose which advertising they receive or respond to. Simply seeing an ad will still have value for advertisers, but the depth of interaction which consumers have beyond that first glance will be commercially vital. The question, however, is whether publishers will be able to exploit these trends as rapidly as new players on the market.
Why does the European Commission deal with the competitiveness of the publishing industry? Is publishing, and in particular the written press, not an exclusive competence of the Member States?
The Commission considers that publishing – as a knowledge industry – needs to be taken into consideration by European policymakers. However, it does not need the same level of policy support as parts of the audiovisual industry. Publishing is in general a competitive industry, as the Staff Working Paper makes clear. European policy covers areas which are of critical importance to publishers, notably intellectual property rights (IPR) and DRM. It also covers areas where they will need to develop views in order to prosper; these range from internet governance through Communications regulation to – for instance – research trends on internet search algorithms.
Many of today’s challenges are cross-cutting; for instance, through deep-linking, a search engine can cross-index and recompile all the content in an electronic publication into its own system. This raises both IPR legal questions and technology issues. Publishers are also moving into a convergent information space on the web where they will be competing with licensed media, including public broadcasters, perhaps requiring reflection on competition issues at European level.
What is the new approach of the Barroso Commission with regard to the publishing industry?
President Barroso included publishing in an expanded Information Society and Media portfolio, considering the whole area to be crucial for the Union’s long term economic success. The Commission believes that now is the right moment to bring together policies for the Information Society, with support for the audio-visual sector and to include publishing within an integrated approach to media policy. The new integrated remit reflects convergence of communication networks, media content and devices. Convergence is bringing different content providers into the same space, accentuating competition among media. To keep pace with technology convergence, we need a coherent set of rules for Europe’s digital economy that is market-oriented, flexible and future-proof. This is one aim of the Commission’s European Information Society 2010 (i2010) strategy (see IP/05/643).
The new Information Society portfolio also includes a co-ordinating role for Commissioner Reding, who must consider the potential impact that any Commission policy might have on the economy or editorial freedom of the media. Media policy therefore extends beyond media policy instruments like Television without Frontiers to take into account the impact of any policy on the media. This too is a first for the Commission.
What is the role of the Task Force on Media Affairs? How does it work? Which issues does it tackle? Which not?
Commissioner Reding set up the Task Force to act as an early warning system when any Commission policy initiative may touch upon the editorial or commercial freedom of the media. The Task Force also has policy-making responsibility for some cross-cutting issues, affecting all media sectors in the common, converging, information space. These are important for developing an integrated approach to certain top-level, cross-cutting issues during this Commission’s mandate. Media pluralism is one example, as is the requirement to develop over time an economic research role in order to prime media policy. The first priority here is to develop the Commission’s understanding of publishing to the same level as for audiovisual media.
Finally, the Task Force acts as an initial contact point for any media company or citizen with queries on how any Commission policy affects the media. Big media companies, especially those in the previous EU 15 Member States are in general well-informed, but the contact point role is intended primarily to help those in newer Member States and smaller media companies.
The Task Force has already compiled a list of nearly 100 policy issues across 14 Directorate-Generals affecting media. A cabinet/service intergroup follows up on these issues and provides early warning across services – and to the Commissioners’ cabinets. The Task Force will also become involved in impact assessments for new policy initiatives in due course, insofar as they affect the media. This will help to establish whether proposals will affect the editorial freedom of the media or have unintended effects on the economy of the media industry. A primary task is to act as a sounding board for other Commission services by pre-screening policy proposals at the concept stage.
The Task Force on the co-ordination of Media Affairs does not handle press enquiries regarding Commission policies. This is the responsibility of DG Press under Commissioner Wallström. The Task Force does not develop policy initiatives for all media sectors either, but it does have line responsibility for the publishing industry, transferred from DG Enterprise, and for certain policy areas covering all media sectors, notably media pluralism.
What is the purpose and programme of the Editors-in-Chief-Meeting of 23 September 2005?
In order to test opinion in the publishing sector and to explore policy options, Commissioner Reding has opted for a hands-on approach, inviting Editors-in-Chief to express their concerns to her in person. As a former journalist herself, the Commissioner attaches importance to the “newsroom view” of how their industry is doing. A group of Editors-in-chief will meet on 23rd September in order to give their view on strategic challenges affecting their industry. These include media ownership and the perceived risk to media pluralism, the impact of web-based news and 24 hour television news channels on the printed press and how particular Commission policies affect the editorial freedom and commercial prospects of the press.
Participating Editors-in-Chief are: Wolfgang Maier, NEWS (Austria); Tøger Seidenfaden POLITIKEN (Denmark), Alvin Sold, Tageblatt – Zeitung fir Lëtzeburg (Luxembourg), Alex Rodriguez, La Vanguardia (Spain); Rolandas Barysas, Verslos zinios (Lithuania); Raymond Bugeja, The Times of Malta (Malta); Arendo Joustra, Elsevier (Netherlands), Emily Bell, Guardian Unlimited (United Kingdom).
What is the purpose and programme of the Publisher's Summit of 6 December 2005?
The Commission is co-sponsoring this event with the publishing industry through five publishing organisations: ENPA FAEP FEP EADP EPC. Commissioner Reding will make a keynote speech at the conference, to be attended by senior executives from all the different sub-sectors: books, press, magazines and directories. The conference will explore how selected EU policies affect the publishing industry and deepen the policy debate around them. The programme – to be published shortly – covers three themes: Competitiveness, Freedom of Expression and Public Policy Objectives, and Responsible Media. The participation of high-level publishing executives will provide valuable feedback for policy makers, complementing the 23 September meeting with the Editors-in-Chief.