The EU doesn't want Kirch to dominate Germany. d-box sales will need to wait til May, this is a 90 day investigation............................................
EU sees CLT-UFA, Kirch venture holding monopoly in German pay-TV
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European Commission said the CLT-UFA, KirchGruppe joint venture in Germany would give its Premiere operation a monopoly position in the German market for pay-TV.
The commission's comments came in its full statement opening an in-depth merger inquiry into the venture and after last night's confirmation that the commission is launching such an inquiry.
'Currently Premiere [to be owned jointly by CLT-UFA and Kirch] and DF1 [Kirch] are the only providers of pay-TV in Germany. Through the merger Premiere would a achieve a monopoly position on the German market for pay-TV,' it said.
'Given the important programme resources Premiere will dispose of following the transfer [of] CLT-UFA's and Kirch's pay-TV rights, there is considerable evidence, that no additional broadcasting and marketing platform could develop in the German pay-TV market,' it said.
Premiere could become permanently the only pay-TV channel in Germany under the merger plan, which will involve Kirch dissolving its DF1 channel and transferring its DSF sports channel rights to Premiere, it said.
Premiere 'would be in a position to determine the conditions under which other broadcasters could compete with Premiere on the German market', it said.
In the market for technical services for pay-TV, there is a concern that Kirch's BetaDigital technology could 'attain a lasting dominant position on this market for the satellite sector in Germany,' it said.
'All current providers of digital pay-TV and [Deutsche] Telekom as the future provider of technical services in the cable sector are committed to use the Beta-access technology and the d-box decoder, which operates with a self-contained (proprietary) encryption system,' it said.
Development of an alternative decoder infrastructure is 'not very likely' and other service providers will have to obtain a licence from Kirch's BetaResearch to use the decoder technology, it said.
The commission said it had rejected a request from the German Federal Cartel Office to scrutinise the case because of the creation or strengthening of dominant positions on six relevant markets in Germany.
'On the basis of the current state of the investigation however, the commission has identified a series of elements showing that the impact of the planned merger extends beyond Germany into the whole German language market,' it said.
There is 'considerable evidence' that the merger could restrain access for pay-TV providers from other member states to the German or German language markets, it said.
The commission will also examine concerns expressed by the German cartel office on the possible negative effects of the merger on the German market for free TV, it said.
Under the merger, Canal+ is withdrawing as a shareholder in Premiere, leaving CLT-UFA and Kirch controlling the pay-TV channel, it said.
BetaResearch will be controlled by CLT-UFA, Kirch and Deutsche Telekom and the telecom company will build a technical platform for cable TV distribution of digital pay-TV programmes, it said.
The technical platform is the subject of a separate merger notification, it said.
CLT-UFA is a joint venture between Bertelsmann AG and Compagnie Luxembourgeoise pour l'Audiovisuel et la Finance, it said.
[NT 23-1-98]
c EuroInfoTech
Brussels 29 January, 1998
Issue 0163 |
