Commission starts TV rights probe

Formal antitrust proceedings to examine programming agreements between US studios and European pay TV broadcasters are underway and could ultimately be extended to include other distributors, the European Commission confirmed today.

EU spokesman Antoine Colombani told TBI this morning that the focus of the rights probe is currently restricted to the Hollywood Studios and their dealings with pay TV broadcasters. But he added that the Commission could not rule out the possibility that as the investigation proceeds, agreements between broadcasters and other content sellers are also investigated.

The current investigation will examine the Studios’ output and volume deals with pay TV broadcasters, covering both TV content and movies. This will involve major US film studios such as Twentieth Century Fox, Warner Bros., Sony Pictures, NBCUniversal and Paramount Pictures, as well as Europe’s largest pay TV broadcasters including BSkyB, Canal Plus, Sky Italia and Sky Deutschland.

The antitrust investigation will focus on whether exclusive and territorial licensing of audiovisual content prevents broadcasters providing services across borders, and whether this “absolute territorial protection” infringes EU antitrust rules prohibiting anticompetitive agreements.

These rules, coming from Article 101 of the Treaty on the functioning of the European Union, were recently raised in a 2011 court case when the EU Court of Justice ruled that Premier League geographic broadcast restrictions breached competition law.

In a statement yesterday Joaquín Almunia, vice president of the EC responsible for Competition said: “If you subscribe to a Pay TV service in Germany and you go to Italy for holidays, you may not be able to view the films offered by that service from your laptop during your holidays.

“Similarly, if I live in Belgium and want to subscribe to a Spanish Pay TV service, I may not be able to subscribe at all if there is absolute territorial exclusivity. Such provisions might constitute an infringement of EU antitrust rules, which prohibit anticompetitive agreements.”

He added: “Of course, the opening of the investigation does not prejudge its outcome.”