STREAM/TELEPIÙ
PRESS RELEASE
PRESS RELEASE
Antitrust investigation of pay-TV
The Antitrust Authority has decided to commence an investigation to ascertain possible behaviour distorting competition on the pay-TV market.
The investigation has been instituted in the wake of the conclusion of multi-year contracts by TELEPIU' for the acquisition of encrypted television rights for the main Serie A and Serie B soccer clubs, and for motion pictures produced by the United States majors and the principal national distributors.
In 1998 and 1999, TELEPIU' concluded exclusive contracts with seven Serie A soccer clubs (Juventus, Milan, Inter, Bologna, Cagliari, Empoli, Bari) and with two Serie B soccer clubs (Napoli and Torino) to purchase the encryted TV rights for matches played in the 1999-2005 soccer seasons. For the 1998-99 season, these soccer broadcasting rights accounted for 70-80% of the total subscription revenues for the Serie A matches, and 60-70% of the aggregate value of revenues paid for the Serie B matches.
It is also the case that TELEPIU' possesses exclusive rights for the première screening of motion pictures distributed by the leading motion picture corporations, both foreign (Columbia-Tristar, Paramount, 20th Century Fox, Universal, Warner Bros., Dreamworks and Disney Buena Vista) and Italian (the Cecchi Gori Group). Since the soccer broadcasting rights and the most popular films are needed to create a supply of so-called "premium" programmes, in other words, programmes which will attract viewers to take out subscriptions and renew them subsequently, the hoarding of long-term exclusive contracts for the most important broadcasting rights might lead to a closure of the pay-TV market, to the detriment of actual and potential competitors.
The Authority has also envisaged the possibility that some of the clauses in the contract which TELEPIU' and STREAM concluded on 8 August 1996 are potentially restrictive of competition. This applies in particular, to the clauses which limit STREAM's ability to use Serie A and Serie B championship rights to cable-TV transmission alone, until the end of 2002. The clauses would appear to substantially restrict STREAM's ability to compete against TELEPIU', and might substantially reduce competition on the Pay-TV market, with negative repercussions for the consumers in terms of price, product quality and technological improvements.
The investigation has been instituted under Community Law (Articles 85 and 86 of the Treaty).
Rome, 15 April 1999