Brussels, 30 January 2004
Commission launches sector inquiry into the sale of sports rights to Internet and 3G mobile operators
The European Commission has decided to launch a broad investigation regarding the sale of sports rights to Internet companies and to providers of the third generation (3G) of mobile phone services. The purpose of the inquiry is to have as clear and wide a view as possible of the availability of audiovisual sports rights in the European Union. Sports rights and notably football rights are powerful drivers for the sale of pay-TV subscriptions but also for the roll-out of new media markets, such as enhanced Internet and UMTS services. In the interest of entrepreneurship, consumer choice and innovation, the Commission wants to make sure that access to this key premium content is not unduly restricted.
The Commission has today decided to launch a sector inquiry regarding the conditions of provision of audiovisual content from sport events to the Internet and other new media as well as 3G mobile telecommunication networks. This is the first broad investigation by the Commission in the area of new media rights.
"As the launch of 3G networks enters into full swing and the success of the service weighs heavily on the operators' ability to deliver attractive audiovisual content, it is the task of competition regulators to ensure that access to sports rights remains open and non-discriminatory," said European Competition Commissioner Mario Monti.
The Commission's experience so far in this field has highlighted possible anti-competitive commercial arrangements and conduct across the whole industry.
Such behaviour would chiefly take the form of refusals to supply, the bundling of TV rights with new media/UMTS rights, the existence of embargoes favouring TV coverage over new types of coverage or the purchase of new media/UMTS rights on an exclusive basis.
The Commission has encountered some of these practices when dealing recently with the sale of the media rights to the Champions League European football tournament and the sale of the rights to the English and German premier leagues. In all cases, it took care to ensure that access to such popular rights was not monopolised to the detriment of new competition. But there is a need for a sector-wide approach which would clarify the application of competition rules and provide guidance to both the owners of the rights and those willing to buy them".
In view of the above, the Commission will shortly send questionnaires to a number of representative sport organisations and other holders of sports rights, including agencies, broadcasters and mobile network operators with a view of acquiring as broad and wide a view as possible of market evolutions and practices.
The aim of the Commission's inquiry is to establish whether current commercial practices infringe the European competition rules, in particular the prohibition of restrictive practices and abuses of dominant position (Articles 81 and 82 of the EC Treaty).
Industry at crossroads
The 3G mobile phone market is still in its infancy which makes it all the more important to ensure that it is not barred from key content. According to industry figures, there are currently just over 500,000 subscribers of 3G services in Europe even though 81 percent of the EU population have a mobile phone. The service has been introduced in five EU countries Sweden, Denmark, United Kingdom, Italy and Austria but 40 new networks are expected to be launched in Europe in the next 12 months.
The provision of a range of new services and, in particular, the transmission of images and sound from sports events via mobile telephony handsets to subscribers is the essential advantage of 3G networks compared to the previous generation infrastructure.
Note to editors
Under Article 12 of its main procedural antitrust Regulation (1), the Commission may initiate general inquiries into those sectors of the economy where it believes competition might be restricted or distorted. The aim of this provision is to allow the Commission to investigate suspicious pricing structures or other practices indicating a possible anti-competitive situation across a whole industry.
Article 12 of Regulation 17/62 EC is particularly suitable for inquiries in established oligopolistic markets where the presence of a small number of important players incites concerted practices. It is also an appropriate instrument for inquiring into sectors where business practices are not yet established and competition is shaped through one shot big size agreements as in the New Media/3G content sector. Sector inquiries allow the Commission to investigate the agreements that shape now the future competitive environment in the sector.
In the framework of the new procedural Regulation 1/2003 which enters into force on 1 May 2004, sector inquiries provide a particularly appropriate instrument for investigating cross border market concerns and examining sector wide practices that do not normally fall within the scope of an individual case. Sector inquiries will allow the Commission to analyse allegedly anti-competitive practices in a systematic and transparent manner and will give the opportunity to national authorities to launch their own parallel national investigations on the basis of the Commission's findings.
(1) (1) Article 12 of procedural Regulation No. 17, OJ No. 13 of 21.2.1962, p. 204/62