Ireland produces some of the world’s most acclaimed film and screen drama. This ranges from the hit television show Vikings to stunning animations from Cartoon Saloon and Brown Bag Films that have scooped Oscars in the past, as well as dramas and comedies that go down in screen history such as Father Ted.

New European legislation is coming in to ensure that more of these productions reach viewers’ eyeballs on the screens they are watching now – including a 30 per cent European works quota on popular subscription services like Netflix and Amazon Prime. Yet in the same breath, lawmakers in Brussels have also required EU countries to regulate online harmful content, with the heavy burden of watching the Irish-based European HQs of technology multinationals expected to fall on the shoulders of a revamped Broadcasting Authority of Ireland.

James Hickey served two terms as CEO of Screen Ireland and told The Currency why the EU directive is important for Europe’s audio-visual sector – and why he is worried authorities here may miss this opportunity to boost Irish film and television production if it comes second to the daunting task of establishing a de facto European-wide social media watchdog.

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The EU’s Audiovisual Media Services Directive (AVMSD) was passed at the end of 2018 and must be implemented by September 2020. The directive requires all EU member states to regulate media in their countries. It includes a 30 per cent quota of European works on video-on-demand services.

The Department of Communications introduced draft legislation called the Online Safety and Media Regulation Bill in January 2020 and aims to implement updated EU rules for content published on media platforms including traditional broadcast, video on demand (VOD) services and user-generated content services such as Facebook. The bill would also ensure measures are taken to regulate online content which could be seen as harmful for users.

“The concern I would have is the attention would be focused on the regulation of online harmful content and there wouldn’t be a sufficient focus on media regulations and the arrangements for the future of the screen content production sector in Ireland,” says Hickey.

This legislation will impact some of the biggest multinationals around the globe including Google, which owns YouTube, and Facebook. A lot of the content published on these sites is produced by their users.

“The big challenge for Ireland as a country is that there will be a focus on Ireland from the EU because Google and Facebook are based here, and the Audiovisual Media Services Directive requires that a degree of regulation be applied in relation to those types of services,” says Hickey.

The overall audiovisual sector has a gross value added of over €1 billion a year and provides 17,000 jobs. For film, television and animation production alone in Ireland, the gross value added is €700 million a year and the headcount is 12,000 full-time jobs.

Streaming and advertising levies

Video-on-demand platforms include Netflix, Disney Plus, Amazon Prime and Apple TV. Under the directive, 30 per cent of their content has to be European works. This is an evolution of an EU regulation brought in during the 1980s, which required 50 per cent of all content on broadcast television to be European works.

“Even if Netflix is not based in Ireland for example, the Audiovisual Media Services Directive allows Ireland to collect levies from those services in respect of the subscriptions paid by Irish customers.”

James Hickey

This would allow the audio-visual sector to grow across Europe and would promote the production of television drama and animation production in Ireland. This is particularly important for Ireland in the aftermath of the Economic Analysis of the Audiovisual Sector in the Republic of Ireland report by Olsberg SPI with Nordicity in 2017.

The report advocated increasing both indigenous and inward production in Ireland and made up to 30 recommendations on how this could be achieved – including through a reform of tax incentives as previously reported.

Hickey sees this as an opportunity to introduce a 2 per cent levy on subscription services including internet service providers such as Amazon Prime and Netflix. Other EU member states already impose such levies. For example, Germany introduced a levy for people paying for Netflix – but this money was going to another EU member state, where this company was based. With the AVMSD, each EU member state can now levy services that are not only based on their territory, but also targeting their national audience.

“Even if Netflix is not based in Ireland, for example, the Audiovisual Media Services Directive allows Ireland to collect levies from those services in respect of Irish customers,” says Hickey.

Hickey estimates that the amount paid by Irish people to subscription content services, such as Sky and Netflix, is around €1 billion a year. This is excluding the Television License Fee. If Hickey’s proposed 2 per cent levy was introduced, it would generate €20 million.

Hickey believes that levies could apply not only to subscription services, but also to advertising that targets Irish audiences.

Advertising has migrated from traditional media spaces over to online platforms. Online Irish-focused paid advertising is worth around €550 million. The overall figure including broadcast and other types of advertising that target Irish audiences amounts to around €1 billion, according to Hickey. He believes that this should also be subject to a levy.

“If you had a levy on advertising expenditure for Irish-targeted advertising, of 2 per cent again, you could have another €20 million. So the total fund is €40 million,” says Hickey.

A new regulator

Hickey’s hope is that a fund in Ireland, such as Screen Ireland or the Broadcast Authority of Ireland Sound and Vision Fund, would manage this sum and spend it on storytelling content made by Irish creative talent.

The European directive also requires Ireland to appoint a new media regulator. Hickey believes the BAI is the best vehicle to be in this role and predicts that if this were to happen, the organisation would grow considerably.

The implementation of the directive and consequently the introduction of a new media regulator for Ireland is particularly important to the EU, according to Hickey.

“The European Union knows that the headquarters of Google and Facebook are in Ireland and in effect, the regulator in Ireland becomes the regulator for those services on a European basis,” says Hickey. He compared the future media regulator’s function to that of the Irish Data Protection Commissioner.

Hickey has his doubts whether the directive will be introduced by the deadline of September 2020. Currently, the EU is still drafting guidance notes on how EU member states should introduce it.

On home soil, we are still between governments, making it difficult to implement new changes to legislation.