European Commission Accepts Commitments From Film Studios to End TV Geoblocking in EU
The move will open up pay-TV markets, allowing consumers across the EU access to a wider range of content regardless of their location.
March 08, 2019 at 07:26 PM
2 minute read
The European Commission has accepted commitments made by The Walt Disney Co, NBCUniversal Media LLC, Sony Pictures Entertainment Inc, Warner Bros Entertainment Inc and Sky TV to end the practice of "geoblocking" their content – an agreement that brings to an end a years-long antitrust case.
Under the agreement, the studios and Sky UK will open up pay-TV markets, allowing consumers across the E.U. access to a wider range of content regardless of their location. Previously, the content could only be accessed in the U.K. and Ireland.
The Commission, the E.U.'s antitrust watchdog, announced on Thursday that it would accept the offers that came from the five companies late last year. The offers are legally binding, the Commission said, and if the companies fail to honour their commitments, they could be fined up to 10 percent of their global turnover.
The companies made the offers in November and December last year after an investigation, launched by the Commission in 2015, found that the companies were involved in anticompetitive behaviour.
The Commission said the restrictions that the companies imposed on Sky UK harmed competition because customers from outside the U.K. and Ireland who wanted to subscribe to its pay-TV services were prevented from doing so. This is known as "passive sales", as the service provider does not actively market its content to those consumers.
In its investigation, the Commission found that the companies had inserted clauses into their licensing agreements with Sky UK that obliged the company to block their content from being available on Sky's satellite and cable pay-TV services.
NBCUniversal, Sony Pictures and Warner Bros also had insisted on clauses that required Sky to ensure that other broadcasters were prevented from making their pay-TV services available in the U.K. and Ireland. Sky has now agreed it will no longer apply such clauses.
The commitments also include the studios promising to end the practice of taking pay-TV service providers to a tribunal where they have breached any restrictive clauses.
All current and future subsidiaries of the committing parties are covered by the commitments. This means that, following the acquisition of 21st Century Fox by Disney, the commitments will also apply to Fox.
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