Commission Announces New Digital TV, Public Financing Investigations

BRUSSELS, July 20: The European Commission has announced
investigations into the digital terrestrial rollouts in Italy and the German
states of Bavaria and North Rhine-Westphalia, as well as an inquiry into the
financing of Belgian pubcaster VRT.

Regulators have given the Italian government two months to
respond their concerns over legislation implemented by former PM Silvio
Berlusconi regarding access to the digital TV market. The commission, concerned
that RAI and Mediaset may have an unfair advantage, noted that the legislation
"may indeed preclude operators which are not active in analogue
transmissions from experimenting with digital transmissions and from creating
their own digital networks."

Digital terrestrial TV is also under investigation in the
German states of Bavaria and North Rhine-Westphalia, with the Commission
looking into government subsidies to commercial broadcasters for their DTT
rollouts. The media authorities of Bavaria and North Rhine-Westphalia plan to
grant subsidies (2.4 million euros in the former and €6.8 million euros in the
latter) to commercial broadcasters to meet part of their transmission costs via
the DTT network. Competition Commissioner Neelie Kroes commented: “The
Commission is firmly committed to encouraging the transition to digital TV,
which has many advantages for consumers and innovation. However, it needs to
make sure that any state support does not distort competition, in particular
between terrestrial, cable and satellite platforms.”

The EC has also called on the Belgian government to provide
a clarification regarding the public-service mission and financing of VRT. In a
statement, the regulator noted, “Having examined allegations from several
complainants, the Commission’s preliminary view is that the current financing
system is no longer in line with EC Treaty state aid rules requiring Member
States not to grant subsidies liable to distort competition.”

Similar investigations concerning public broadcasters in
Germany, the Netherlands and Ireland are still pending.