French media regulator the CSA has expressed concern about Canal+’s planned deal with BeIN Sport, according to local reports.
According to the BFM Business news service, the CSA has highlighted numerous problems with the proposed deal in a confidential opinion passed on to the French competition watchdog.
While the deal as it currently stands is centred on exclusive commercialisation of BeIN Sports by Canal+, the CSA has said that the agreement carries a risk that the pair could go further and agree not to compete for future sports rights, something that would be illegal.
The media regulator also points to the fact that Canal+ already has an exclusive carriage deal with Eurosport, meaning that a deal with BeIN Sport would give it exclusive arrangements with practically all the sports rights holders in the market.
According to BFM Business, the CSA has also highlighted that securing a revenue stream of €400 million (US$445.5 million) a year from Canal+ would mean that BeIN Sports could be less willing to sub-license rights to free channels, as it currently does with TF1.
It also points that an exclusive deal with Canal+ could have a detrimental impact on the strength of Orange, Free and SFR as distributors of TV channels.
The CSA has also questioned whether the market has evolved in a way that would justify the early lifting of a block on Canal+ distributing premium channels on an exclusive basis for five years from 2012.
According to the regulator, as reported by BFM Business, the relaxation of the obligation to make premium channels available to rival players could only be lifted if the competitive environment had changed enough in the interim to justify it.
The CSA argues that Canal+ maintains a dominant position in the pay TV market despite changes in the market, such as the emergence of SFR as a competitor post its acquisition by Numericable. It said that Canal+ also retains a dominant position in the acquisition of sports rights, with most key rights now being held either by it or by BeIN Sports.
The regulator also maintains, contrary to the position held by Canal+, that Netflix has not emerged as a significant direct competitor at this stage, given that the SVOD provider can only distribute films that are at least three years old in France, whereas Canal+ can air films ten months after their theatrical release in the pay TV window.
According to BFM Business, the CSA has also questioned whether one obligation placed on Canal+ could legally be relaxed while others remain in place. The regulator says that the premium channels obligation would be difficult to separate from other restrictions placed on Canal+ related to thematic channels.