'Geo-blocking': what's past is prologue
Michael Geist provides an interesting discussion on the business practice of "geo-blocking" (see 'Geo-blocking' websites is a business rather than legal issue). Broadcasters, sports leagues, music services and other rights holders employ geo-blocking (also referred to as "geo-gating") to protect the value of their content on the Internet. Not surprisingly we are increasingly seeing the Internet adopt geography-based licensing as rights holders wish to maximize the value of their rights. A common misunderstanding among Canadian-Internet users is to blame "outdated laws" for the inability to access audio or video links due to geo-gating practices. Geist correctly observes that, in reality, geo-gating is "invariably a business issue, not a legal one".
But the subtext in Geist's piece is somewhat puzzling: he appears to suggest that geo-blocking practices are outdated. Geist argues that geo-blocking will only disappear "only if the business models they support give way to global approaches that make the borderless Internet a reality". But Geist's vision for a more ideal Internet environment is arguably unrealistic and at the very least runs afoul of ordinary business practices. Geo-blocking is a perfectly rational response to bringing some order to the chaos of the Internet. To use Geist's phrase, the Internet is a "a 'borderless' world that has little regard for the physical location of users". Micro-economists and other organizational theorists have recognized that there are "bounds to rationality" on many types of arrangements including in the business world. In the absence of measures such as geo-blocking, right holders would find it difficult if not impossible to clear rights in multiple jurisdictions. Without some mechanism to enforce program rights across multiple territories, the potential economic returns from the distribution of high-cost high revenue programs such as feature films or World Cup games would be threatened.
In fairness, Geist is correct that the business arrangements around geo-gating have in some cases resulted in delays for Canadian users in accessing content on the Internet until distribution platforms such as iTunes could sort out the rights issues. But the point is, these issues were sorted out. As Geist himself concedes, Canadian platforms have successfully secured Internet rights for domestic Internet audiences (eg, Canadian users must view The Daily Show on CTV's Comedy Network site and cannot access the content on the US broadcaster's site). These internet fences should not be viewed as shackles. Rather they are perfectly reasonable tools to ensure the continued ubiquitous access to content on all platforms across the inter-connected world.
