Brussels, 18/07/2007 (Agence Europe) - The European Commission approved the purchase of the fixed telephony and internet access activities of Télé 2 France by the French mobile operator SFR on Wednesday 18 July. The planned operation raised serious concerns in the Commission of a breach of competition in the French pay-TV markets when it was initially notified, and an in-depth investigation was launched (EUROPE 9391). These concerns have now been addressed by commitments guaranteeing other DSL operators equal treatment with the new entity as regards access to audiovisual content controlled by the Vivendi group, to which SFR belongs.
Neelie Kroes, the commissioner for competition, said: “It is essential […] that the Commission should make sure that viewers enjoy a wide choice and the most competitive rates possible [for television]. The remedies to which approval of this operation is subject are designed to ensure this by safeguarding the interests of pay-TV consumers in France”.
SFR is a French company which is mainly active in the mobile telephony sector. It is jointly controlled by Vivendi (France) and Vodafone (UK). Télé 2 France, a subsidiary of Télé 2 Europe, is active in France in the fixed telephony, mobile telephony, internet access and DSL pay-TV distribution sectors. The telephony business is not affected by the operation, the effects of which pertain to the pay-TV sector in France.
The market survey carried out by the Commission revealed that DSL operators are the main players likely to exert competitive pressure on the Vivendi group in the markets concerned, but that this pressure is limited in that it is very difficult for others to gain access to attractive audiovisual content (television programmes and channels), as this is mainly controlled by Vivendi. Vivendi could have given its subsidiary SFR/Télé2 privileged access to the audiovisual content it controls, which would have given it a substantial (and, under Community legislation, illegal) advantage over other DSL operators.
With a view to eliminating these barriers to competition, Vivendi and SFR have proposed several commitments: 1- other operators will be able to distribute all the channels available to SFR/Télé2, under conditions which are at least as advantageous as those available to SFR; 2 - the conditions of access to the channels distributed by Vivendi on DSL networks and its PPV (pay-per-view) services will not be less favourable for subscribers to DSL operators other than SFR/Télé2; 3 - SFR/Télé2 will not be able to gain exclusive distribution rights to channels produced by third parties except where Vivendi already holds exclusive rights; 4 - neither Vivendi nor SFR/Télé2 will be able to acquire exclusive VoD (video on demand) rights to recent American or French films. (cd)