With respect to European Union’s attempt for a universal content scenario where there would be no content alteration with geographical alterations, Netflix and Amazon TV Prime have been given a quota of minimum 20% of European content broadcasting as well as production. European Union has done this as a step towards preserving local content of the European Union. The audio visual directive of media services has asked them to stream European content on their websites and apps regularly, at least 20 percent of it so that the content is preserved. It is more or less of a subsidy to movies kind of thing.
Broadcasting companies are asked to devote half content to broadcasting indigenous content. However, Netflix has claimed that this approach will not be a good approach since it will distort personalised programming suggestions for each user which are tailor made on the basis of viewing experience asked by users. European Union’s media and marketing initiative president said how this would enable them to level the field as well as will break boundary restrictions due to which content is changed as we move across boundaries.
Apart from content quota, there would also be provisions made by European Union so that content containing visual and audio violence does not come in contact with minors. As market of movies from Hollywood has already overtook the movie market, it is important to save indigenous producers and content. Netflix would be more affected since it has a mere 21% quota of European content and can fall down the threshold any time whereas content from Amazon prime is well beyond 27%. Netflix would have to invest much more into it.
They have suggested that they would start to make and air more European content on a smaller scale to meet the quota demand. More than 40% of Netflix users are outside the USA so obviously they had to incorporate non-traditional content to appeal to its users. However, this would seriously hamper regular content and recommendations which are based on user’s viewing habits.
Breaking down of recommendations engine because of this flaw is a major upset which Netflix cannot face. Therefore, they are working on a way around. Similarly, subsidised content also gets a mixed reaction as it does not follow competitive market and many market analysts think it is useless to subsidize a film.