Steverino Faces Hurdles to iTunes Movie Rentals

After introducing an online film rental business for American consumers last week, the chief executive of Apple, Steven P. Jobs, said he expected that the service would be expanded into international markets later this year.

But trying to establish a European version of the iTunes movie rental service, which allows users to stream films or television shows to their computers or televisions, will not be easy.

Apple will have to confront legal and regulatory hurdles, copyright challenges, scheduling conflicts and technological issues, reminders that the European media landscape remains a patchwork of individual countries, rather than the single market that the European Commission envisions.

“The biggest challenge that we have is just the structure of the market,” said Kevin Obi, senior vice president for digital assets at NBC Universal in London, which has licensed shows to several online video-on-demand services.

Because of the difficulty of setting up cross-border services, many participants in the nascent market for digital film rentals or downloads in Europe operate in only one or a handful of countries.

They include MK2, a French movie theater owner; Lovefilm, a DVD rental company in Britain that expanded into digital downloads; and Glowria, a similar business in France.

Last month, Microsoft expanded a service that allows users to download movies over its Xbox 360 video game console, opening up in Britain, France, Germany and Ireland, about a year after starting it in the United States.

The European Commission, the executive arm of the European Union, warned this month that there were significant barriers to developing digital media distribution in its 27 member countries. And Viviane Reding, the commissioner who oversees media, said that by midyear she would propose ways to make it easier to sell content online, including efforts to streamline digital commerce across borders.

“Europe’s content sector is suffering under its regulatory fragmentation, under its lack of clear, consumer-friendly rules for accessing copyright-protected online content, and serious disagreements between stakeholders about fundamental issues” like copying of digital works, Ms. Reding said in a statement.

One problem she cited was the need for content distributors to secure individual licenses to films and other copyrighted material in every country in which they planned to do business. The commission said it would examine ways to encourage rights holders, including movie studios, to issue “multiterritory” licenses.

While pan-European approaches might seem desirable in Brussels, that is not always the case in national capitals, particularly in smaller countries fearful about the decline of their own cultural industries.

http://www.nytimes.com/2008/01/21/technology/21video.html?_r=
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