1. Action without plot The investigation of coordination in the media
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Action without plot The investigation of coordination in the media
David Aitman
BIICL Competition Law Forum, 6 December 2006

2. The test of a decent competition decision
Plot – what plot?
The test of a decent competition decision
Clear infringement
Customer / consumer detriment
Remedies that are:
fair and proportionate
targeted
Effective
No reason these tests shouldn’t apply to media decisions
Several decisions in the media sector seem to have lost the plot

3. An overview of some recent horizontal media decisions
Losing the plot?
Spanish films – theatrical distribution terms
Pay tv licensing – most favoured nations clauses
Merger remedies – Sky Italia
Where to from here?
Sony/BMG

4. Minimal analysis of consumer detriment
Spanish films
No clear infringement
Coordination implied from parallel use of rational provisions
Failure to take account of lack of parallelism
Focus on similarities between insignificant provisions
Minimal analysis of consumer detriment
No real testing of comparative rates
No testing at all of causal effect of alleged coordination and rates
No practical remedy – fines don’t address “the issue”
Verdict – a poor decision on any measure

5. Pay tv – most favoured nations clauses
No clear infringement
“White-listed” in old-style block-exemptions
Arguably a proportionate response to dominant purchaser
No clear consumer detriment
No proof that provisions led to price increases
Real possibility that provisions led to lower prices
Inappropriate remedy
Commission adopted a “who blinks first” settlement
Verdict
Commission ignored the real issue – BSkyB’s market power
Commission reached a poor, inequitable settlement

6. Sky Italia and – looking ahead - music
Approval of monopoly of Italian pay broadcasters
At cost of regulating and coordinating terms of content licences
Verdict – again an irrational attack on terms of licensors
Sony/BMG
Is the sector – or is it not – subject to tacit collusion?
If it is – what will be impact on manner in which majors do business?
Verdict - open

7. Conclusion Why is there Is there Has the agenda moved on?
a “lack of plot”
a history of some poor decision taking
Is there
a special focus on the media
a belief – mistaken or otherwise – about an MPA conspiracy
Has the agenda moved on?
Would this slide be more aptly titled “Lack of Conclusion”…

8. © Freshfields Bruckhaus Deringer 2006
This material is for general information only and is not intended to provide legal advice. v1