On 9 July 2026, the Court of Justice of the European Union (the “CJEU”) delivered an important judgment for streaming service providers in Case C-234/25 Sky Österreich Fernsehen.
The CJEU considered whether a subscription offering access to live, on-demand and downloadable programmes constituted “digital content” or a “digital service” under Directive 2011/83/EU on consumer rights (the “Consumer Rights Directive”), as amended by Directive (EU) 2019/2161, for the purposes of the statutory right of withdrawal.
The CJEU held that providers of streaming offerings that qualify as digital services cannot rely on contractual terms providing that consumers lose their 14-day right of withdrawal as soon as they begin watching or streaming content. The judgment clarifies the distinction between digital content and digital services and has important implications for streaming and other online subscription businesses.
For online subscription businesses, the practical point is that the features and functionality of the service can affect both its classification under consumer law and the consumer’s withdrawal rights once use of the service begins.
Background
The case arose from Sky Österreich Fernsehen GmbH’s (“Sky”) streaming subscriptions, which gave consumers access to live and on-demand programmes and, depending on their subscription tier, allowed programmes to be downloaded for offline viewing. Sky required consumers subscribing online to agree that performance could begin during the 14-day withdrawal period and that they would consequently lose their withdrawal right. Article 16(m) of the Consumer Rights Directive permits that result, subject to specified conditions, for contracts for the supply of digital content not supplied on a tangible medium. There is no equivalent exception for a digital service merely because performance has begun.
The Austrian consumer protection association Verein für Konsumenteninformation (“VKI”) challenged that approach. Sky argued that its offering was digital content, with the result that the consumer could lose the withdrawal right after expressly consenting to immediate performance and acknowledging that consequence. VKI argued that the offering was instead a digital service, meaning that Article 16(m) did not apply. Under Article 9 of the Consumer Rights Directive, a consumer generally has 14 days to withdraw from a distance or off-premises contract without giving a reason.
Streaming services: digital content or digital services?
The Austrian Supreme Court referred the matter to the CJEU, asking whether a streaming service that enables consumers to access digital data stored on a server for live, on-demand or offline viewing constitutes the supply of “digital content” within Articles 2(11) and 16(m) of the Consumer Rights Directive. The CJEU held that the method of access and the continuous nature of supply are not, by themselves, determinative: an offering involving access to digital data may constitute either digital content or a digital service.
The CJEU held that the distinction turns principally on the degree of the trader’s involvement in supplying the digital data. A streaming offering is properly characterised as a digital service where it is dynamic and goes beyond the stable or continuous provision of specific content. Relevant features may include:
- monitoring the content accessed by the consumer;
- creating playlists or favourites lists;
- providing personalised recommendations;
- adapting the offering to the consumer’s behaviour or expectations; and
- providing features that otherwise influence how the consumer uses the service.
Where a streaming offering is properly characterised as a digital service, the trader cannot rely on Article 16(m) to extinguish the consumer’s right of withdrawal when streaming begins, even if the consumer has agreed to that outcome in the terms and conditions. The consumer must retain the applicable withdrawal period in which to assess whether the subscription meets their expectations. Subject to verification by the Austrian court, the features of Sky’s offering indicated that it fell within that category.
Commercial impact: does the withdrawal right create a free trial?
Not necessarily. Where a consumer has expressly requested that performance begin during the withdrawal period, and the other statutory conditions are met, Article 14(3) permits the trader to recover an amount proportionate to what has been supplied before the consumer exercises the withdrawal right. The amount will generally be calculated by reference to the period of use and the total contract price. However, where appropriate, the economic value of particularly valuable content made available to and viewed by the consumer may also be relevant. This means that preserving the consumer’s withdrawal right does not necessarily result in the consumer receiving the service free of charge.
Practical implications
The judgment confirms that a streaming service is not classified as digital content merely because the consumer accesses digital content through it. Where a platform is dynamic, personalised and continuously involved in shaping the consumer’s experience, it is likely to constitute a digital service for EU consumer law purposes. The implications extend beyond video streaming and may affect music streaming services, educational platforms, fitness platforms and other services offering customised user experiences.
Streaming and subscription businesses should review:
- whether the offering is sufficiently dynamic or personalised to constitute a digital service;
- the terms addressing commencement of performance and loss of withdrawal rights;
- the mechanism by which consumers expressly request immediate performance;
- how any proportionate payment is calculated and evidenced; and
- whether the online cancellation journey complies with section 115A of the Consumer Rights Act 2022.
The judgment should also be considered alongside the new requirements governing online cancellation mechanisms. Directive (EU) 2023/2673 inserted Article 11a into the Consumer Rights Directive, requiring traders that conclude relevant distance contracts through an online interface to provide an electronic function through which consumers can exercise their right of withdrawal. In Ireland, S.I. No. 309/2026 inserted section 115A into the Consumer Rights Act 2022. Section 115A requires an “online cancellation function” that is prominently displayed, easily accessible and continuously available throughout the cancellation period. The function must enable the consumer to submit an online cancellation statement, followed by a clearly labelled confirmation step and an acknowledgement of receipt on a durable medium. Streaming providers should therefore review both the legal characterisation of their services and the design of their online cancellation journey.
Businesses offering streaming or other personalised subscription services should therefore review their terms, sign-up processes and cancellation journeys in light of both the CJEU’s decision and the new Irish requirements.
Contact us
For more information regarding the right of withdrawal, or consumer protection generally, please contact any member of our Technology and Innovation Group or your usual Matheson contact.
