The Media Act received Royal Assent in the Parliamentary wash-up period at the end of May 2024. It streamlines the broadcasting regulatory framework, bringing a broader range of video-on-demand (VoD) services into scope.
Scope
The Act is split into six main operative parts with Part 4 focusing on VoD services. Part 4 amends the Communications Act 2003. It introduces a new category of service called “Tier 1 services”, to which most of the obligations relate. Tier 1 services are:
- VoD services operated by Public Service Broadcasters (PSBs) and
- VoD services specified by the Secretary of State – these could be referenced by name specifically and may include both UK on-demand programme services and non-UK on-demand programme services (as some services are not headquartered in - but are still accessible from – the UK).
Prior to the Secretary of State’s designations, Ofcom will prepare a report on the UK VoD market to include details of audience figures and content capacity. The SoS must have regard to this report when determining which services to designate as Tier 1 services. Ofcom says that it expects to make information requests to relevant providers to inform its report and that it will hold round table discussions with stakeholders about its plans.
The Act does not specifically identify particular VoD services that will be designated as Tier 1 services, but the government’s press release when the Bill was introduced specifically referenced Netflix, Amazon Prime Video and Disney+ as within scope (these being 'TV-like' services). It is a fair assumption that these platforms will fall within the SoS's first designations.
Obligations on Tier 1 services
Currently, BBC iPlayer is the only VoD platform that must adhere to Ofcom's Broadcasting Code. This has meant that VoD platforms (other than iPlayer) are not subject to the same content requirements as linear broadcasters. Part 4 aims to address this disparity for Tier 1 services.
Under the Act, Tier 1 services will be subject to a new Ofcom VoD Code (similar to the Broadcasting Code) containing enhanced content standards . The VoD Code will be aimed at protecting minors, excluding content likely to incite crime or disorder, ensuring news accuracy, meeting impartiality requirements, protecting audiences from offensive and harmful material, and ensuring religious programmes are responsible. Guidance on the VoD Code will be issued by Ofcom.
The Act also introduces requirements on Tier 1 service providers to ensure their services are accessible to people with disabilities. Ofcom says that, "This will mean that the existing statutory requirements for linear broadcasters to provide subtitling, audio description and signing are matched on mainstream on-demand services."
For each of the first two years, at least 40% of catalogue hours must be subtitled, 5% must be audio described and 2.5% must be signed. This then doubles such that, in each of the subsequent years, the targets are 80%, 10% and 5%, respectively. A VoD Accessibility Code will be produced to flesh out what is in the Act.
Audience protection measures
The Act also requires Ofcom to review the audience protection measures implemented by VoD providers to protect audiences from harm. This includes measures adopted by all UK VoD services and non-UK Tier 1 services.
The aim of the review is to consider whether the audience protection measures are adequate for the purpose of assisting the providers to comply with the duties imposed on them under the Communications Act for the protection of audiences from harm.
Audience protection measures include such things as age rating or other classification systems, content warnings, parental controls and age assurance measures. The Act requires Ofcom to guarantee viewer protection measures are consistent, for example, through age ratings. While she was Shadow Minister for DCMS, Stephanie Peacock gave examples of the types of measures this might include: [in relation to VoD services] "…users are likely to start at the beginning of an episode or movie, meaning that there is an opportunity to warn audiences about the nature of the content they are about to see… The Ofcom review should cover signposting and educational resources as an important component of audience protection... Such measures can and should play an important part in complementing warnings and ratings, which cannot do much to help once a piece of content has already been watched."
What about non-Tier 1 providers?
Most of the obligations in Part 4 apply to Tier 1 services only. Non-Tier 1 providers in the UK will continue only to be subject to the 'on-demand programme service providers' rules and non-Tier 1 providers outside of the UK will continue to be unregulated.
What else?
The Act, in an expansion of the original draft, introduces new powers for Ofcom to report to the Secretary of State on issues it identifies in carrying out its regulation of Tier 1 services and any general policy issues relating to those services. This suggests the code could be adapted to protect against any new harms that Ofcom has identified in its regulatory capacity.
Who benefits from the new provisions?
The new legalisation will implement a simple, flexible yet robust set of rules on what can be shown by VoD services, including those provided by PSBs. This means that PSBs will be in a better position to adapt to evolving audience behaviours as more people conduct their viewing on digital devices instead of television sets.
The Act also makes a conscious effort to make sure that PSB on-demand services are easily discoverable by audiences in the UK and includes new rules to make VoD content more accessible to those with seeing and hearing disabilities. There is a clear push for PSBs to be able to grow and create content on an equal footing with VoD services and invest in the new technologies currently not competitively accessible to PSBs given the lack of subscription element.
VoD audiences also arguably benefit from these new regulations as they can make official complaints to Ofcom about content published by VoD platforms in the same way viewers currently can about PSBs and terrestrial live television.
Enforcement
Currently, under the Communications Act, Ofcom has enforcement powers covering registered on-demand programme services (for example BBC iPlayer.) Tier 1 services will now be subject to the compliance rules stipulated by Ofcom and Ofcom will have equivalent enforcement powers to those it has in respect of linear PSBs under the Communications Act. Ofcom will also be in charge of handling complaints in relation to these services. Where VoD services do not comply with the legislation, Ofcom will have the authority to sanction them by issuing fines (of up to £250,000) or restricting access to the UK market altogether.
Interestingly, the penalties aren’t as significant as those introduced for other digital services providers under the Digital Markets, Competition and Consumers Act, which gives the CMA powers to fine non-compliant companies up to 10% of global turnover.
Timing
According to Ofcom's roadmap, Tier 1 VoD services will be designated between Oct 2024 and March 2025. The VoD Code is expected to come into effect between July and Sept 2025, with VoD services in scope expected to comply from July to Sept 2026.
Ofcom expects to consult on a new VoD Accessibility Code around the beginning of 2025. It says that the first set of accessibility quotas (for subtitling, audio description and signing) will come into effect 24 months after the final VoD Accessibility Code is published (ie likely around the middle of 2027), or 24 months after a provider is designated as Tier 1, whichever is later. However, Ofcom expects to consult on the introduction of interim access services quotas likely to apply from 2026, alongside requirements around reporting to Ofcom on accessibility and provision of information to disabled people.
Key takeaways
One of the main aims of the Act is to bring all mainstream VoD services accessible in the UK under an Ofcom regulated content code. Recent research shows that the number of viewers watching programmes on linear broadcasting channels at the scheduled times has fallen by 25% since 2011, with 68% of this figure representing those aged 16-24.
While there is nothing particularly surprising in the Act, which has changed very little during the course of its Parliamentary progress, it is important to monitor implementing secondary legislation closely, particularly in terms of whether a second tier of regulated entities will be designated.
What the Act does not address is the increasing consumption of content on other video-sharing platforms which fall outside its scope (ie those not designated as Tier 1).
For a considerable amount of time now, broadcasters BBC, ITV and Channel 4 have called on the DCMS to level the playing field. The Act triggers a tangible increase in the accountability of mainstream VoD services, with Ofcom having reasonable enforcement powers for those providers that fail to adhere to the new standards.
To discuss the issues raised in this article in more detail, please contact a member of our Technology, Intellectual Property and Information team.
