Anti-trust watchdogs limber up for digital sports verdict

By Aoife White

Date: 19/05/05

EU anti-trust officials will unveil the results of a year-long investigation into the sale of sports rights to internet and 3G mobile phone operators at a public hearing in Brussels on 27 May.

The sector inquiry began in January 2004 when the European Commission said that it wanted to make sure that access to premium content - particularly football rights - was free and fair. It questioned sports associations, broadcasters and mobile network operators as it sought to check whether current practices complied with EU rules banning restrictive deals and abuse of market power.

Live football coverage is one of the hooks used to snare sports-hungry Europeans into buying 3G mobile phones. The European Commission inquiry came on the back of a lengthy investigation into the sale of broadcast rights to German and English premier league matches. The Commission was worried that major players would quickly dominate an emerging new media market.

The Commission said that it had already highlighted possible anti-competitive commercial deals and behaviour across the whole industry. It sees the media sector as "highly oligopolistic", ruled by a small number of large public and private broadcasters.

But in a complex market, the Commission believes that it could have problems using the legal tools of Article 82 of the EU Treaty to combat abuse of dominant positions.

Herbert Ungerer, the head of DG Competition's media unit, told the Law Society of England and Wales in April that the Commission was anxious to keep emerging markets like new media open to competition. "The market must not be tilted during the transition from analogue to digital, from traditional to new media, in favour of any actor," he said. "The main goal must be to avoid market foreclosure."

He said applying competition law was a vital part of media policy and had a crucial role to play in the shift to new technology.

Ungerer said the complexity of the media industry was forcing the Commission to come up with innovative legal instruments. One example was the first use of a binding agreement, known as a commitment decision, announced in January to govern the sale of rights to broadcast Germany's Bundesliga soccer matches.The European Commission's investigation into the sale of sports rights has been carried out in conjunction with the surveillance authority of the European Free Trade Area.

Michael König, a partner at law firm Linklaters law in Berlin, said the Commission wanted to make sure the market stayed open and competitive. "They are afraid they are going to miss out. With pay-TV they felt they came too late," he said, adding that the pay-TV market was a different case since broadcasters needed key film or sporting rights to survive.

Questionnaires were sent to media and telecoms players in 28 European countries - the 25 EU member states plus Norway, Iceland and Liechtenstein. It was only the fourth EU-EFTA joint sector inquiry since 1994. The other three focused on telecoms issues such as local loop unbundling, roaming and leased lines.

Article anticipates a public hearing in Brussels on 27 May where EU anti-trust officials were planning to unveil the results of a year-long investigation into the sale of sports rights to internet and 3G mobile phone operators. The sector inquiry had started in January 2004 when the European Commission said that it wanted to make sure that access to premium content - particularly football rights - was free and fair.

European Commission: DG Competition: Antitrust: Other documents: Sector Inquiries: Media - 3G http://ec.europa.eu/comm/competition/antitrust/others/sector_inquiries/new_media/3g/

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