Pay-TV sports: Weko sanctions Swisscom with a fine in the millions

The Weko finds that Swisscom has abused its dominant position in the field of live football and ice hockey broadcasts and fines the company almost CHF 72 million.

The Weko found that Swisscom and its subsidiaries were dominant in the live broadcasting of Swiss football and ice hockey championship matches and certain foreign football championships on pay-TV, according to a statement. This is because Swisscom subsidiary Cinetrade holds long-term and comprehensive exclusive rights to broadcast sports content on Swiss pay-TV. Swisscom had abused this market dominance in several respects. For example, Swisscom had refused some competitors any offer to broadcast live sport on its platform. Other competitors, such as UPC Cablecom, were only granted access to a reduced sports offering. Furthermore, unlike Swisscom itself, competitors could only offer their customers sports content linked to Teleclub's basic package. With these practices, Swisscom had gained an unlawful advantage in the competition between TV platforms, according to the statement. The Weko's decision can be appealed to the Federal Administrative Court.

UPC Cablecom welcomes decision - and criticises it

In a statement on Tuesday, competitor UPC Cablecom expressed its satisfaction with the Weko decision. The Weko has thus confirmed the view always held by UPC Cablecom that Swisscom has been using an illegal distribution practice for sports programmes for years, thereby unlawfully depriving a large proportion of the Swiss population of sports content. However, UPC criticises the decision that Swisscom is not obliged to enter into immediate commercial negotiations on the transfer of sports content for customers of other providers as well. This was regrettable and incomprehensible, as it meant that the "untenable situation" would continue to exist. The damage to the competition would be difficult to reverse and would run into millions, while Swisscom, as a state-owned company, would have to hand the fine back to the state anyway.

Suissedigital: "Please refrain from legal banter".

Suissdigital, the association of cable network operators, also welcomes the decision. "We are pleased that the Competition Commission has established and sanctioned the abuse by Swisscom that we have been complaining about for years," says Pierre Kohler, President of Suissdigital. He appeals to Swisscom's sportsmanship and calls on the company to play fair. Kohler: "We ask Swisscom to refrain from legal skirmishes and now make all providers a fair offer for sports broadcasts." This would also be in Swisscom's interest, as it would allow the company to triple the group of potential sports customers in one fell swoop.

Like UPC, however, Suissedigital is also critical of the fact that the Comco is refraining from taking swift action to remedy the situation. "It is very irritating that the Weko has identified the prevailing abuse - which, moreover, is caused by a state-owned company - but does not want to eliminate it," Kohler criticises in a statement. "This is inconsistent with such a clear legal finding and testifies to the Commission's lack of courage in actually wanting to effectively eliminate an abuse at a state-owned company with its decision."

Swisscom rejects accusations and withdraws decision

In a statement, Swisscom said it was convinced that it had acted lawfully in marketing the sports content. The rights would be awarded periodically in an open procedure - other interested parties could also participate. By distributing the rights via the Swisscom TV platform, the company is protecting the high investments it has made in recent years to be able to offer sports content, which had previously been neglected in Switzerland, as attractive content via pay TV. It was only thanks to Swisscom's entry into the TV business in 2006 that consumers had an alternative to the market monopolised by cable network operators. Swisscom also stresses that many more Swiss football matches are now available live on free TV - as a result of Swisscom's involvement. Since then, cable networks have also benefited from a broader sports offering.

Swisscom now intends to examine the present report in detail, refer the decision to the Federal Administrative Court and, if necessary, to the Federal Supreme Court. As the chances are considered to be intact, no provisions are being made. (hae)
 

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