EU clears Vizzavi Internet venture with conditions
(UPDATE: Adds details from statement, background)
BRUSSELS, July 20 (Reuters) - The European Commission on Thursday approved with conditions plans by France's Vivendi , Canal Plus and Britain's Vodafone (quote from Yahoo! UK & Ireland: VOD.L) to form the multi-access Internet portal Vizzavi joint venture.
``Regulatory clearance was made possible after the companies submitted commitments to ensure rival Internet portals would have equal access to the parent companies' set top boxes and mobile handsets,'' the Commission said in a statement.
The review of Vizzavi had to evaluate its impact on competition for markets and products that barely exist yet, as the venture breaks new ground in aiming to put Internet services on all kinds of terminals ranging from computers and television sets to mobile phones across Europe.
``The decision ensures that the current competitive model of Internet services -- where consumers can choose their content provider independently of their access provider -- is carried over into the developing markets of Internet provision via mobile phones and televisions,'' the European Union's antitrust watchdog added.
The parent companies planned for Vizzavi to be the default portal for subscribers to Vivendi and Vodafone's mobile phone services and to Vivendi unit Canal Plus's pay TV offerings.
The Commission's investigation concluded that the joint venture would have led to competitive concerns in the developing national markets for TV-based Internet portals and developing national and pan-European markets for mobile phone-based Internet portals.
ACCESS TO THIRD-PARTY PORTALS
``In order to address these competitive concerns identified by the Commission, the parties provided undertakings to ensure that the default portal could be changed, should the consumer so wish,'' the Commission said.
``The undertakings will allow consumers to access third party portals, to change the default portal themselves, or to authorise a third party portal operator to change the default setting for them,'' it said.
The European Commission routinely reviews cross-border mergers and joint ventures in Europe to ensure they do not contravene EU anti-trust rules.
The Commission's main concern was clearly to make sure that Vizzavi users would be able to surf elsewhere and not be locked in to Vizzavi's pages.
This issue has already tripped up British Telecom (quote from Yahoo! UK & Ireland: BT.L) and France Telecom's mobile operators, whose Internet services have been required by national courts to allow users to move beyond the operators' own default portal and pages.
One analyst said earlier this week that if Vizzavi were to face problems with Brussels, it would threaten Vivendi's planned mega-merger with Canada's Seagram (Toronto:VO.TO - news) VO.N> and Canal Plus to form a colossus to rival Time Warner-America Online (NYSE:TWX - news) (NYSE:AOL - news).
The formation early this year of Vizzavi, half owned by Vodafone with the remaining half split equally between Vivendi and Canal Plus, mostly delighted analysts for its audacity, its vision of Internet-led services and its Europe-wide reach.
However, others say Vizzavi will have to spend heavily on marketing to get its name among established Internet brand names like Yahoo! (NasdaqNM:YHOO - news) or AOL.
Between Vodafone's British, German and Italian mobile phone networks, Vivendi's French fixed and mobile phone networks and Canal Plus's pay TV services in France, Italy, the Netherlands and Scandinavia, the three have 70-80 million subscribers.
Once Seagram's Universal music business is on board, the 300 million CDs it sells a year in Europe will come with a Vizzavi Internet connection CD, Vivendi Chairman Jean-Marie Messier told Reuters in a recent interview. |
