This has the potential to de-rail the rise of VOD TV as typified by personal video recorders. FT.com reports the European Commission is reclassifying pay-TV hard drive- or Ethernet-enabled set-top boxes from communication devices to recording devices, making them liable for a 13.9 percent levy. That could mean BSkyB (NYSE: BSY) incurring £15 million in annual charges for its popular Sky+ box and up to £30 million in backdated charges, the report says. So the TV operators have begun lobbying, considering legal action through the European Court of Justice or World Trade Organisation. Japanese hardware makers already voiced opposition in May.

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Also being reviewed in Europe - a levy on gadgets that allow content to be copied. The levy is in place in the majority of EU states and reaped €568 million for rightsholders in 2004.