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Sky Italia is seeking €100 million in damages from Italian public broadcaster RAI in an appeal filed on January 27th to the Regional Administrative Court (TAR) of Lazio.
The pay-TV operator accuses RAI of encrypting, over several years, some flagship programmes of the public service to the detriment of Sky Italia subscribers.
The practice, which began in July 2009 and is still ongoing, is considered by the pay-TV operator as “illegitimate” because it violates the obligations foreseen under the public service contract for the period 2007-2009 (which remained in force until 2011). According to the contract, RAI was obliged to provide free of charge “its entire programming on the various platforms, compatible with the rights of third parties”. Sky considers that the conduct of RAI has led to lower growth in subscriptions and a decline in audiences, with a net loss of over €100 million.
Back in July 2009, RAI began encrypting some of its TV channels and programmes on the Sky Italia platform. At the same time, the pubcaster, Mediaset and Telecom Italia Broadcasting launched TivuSat, a new DTH platform officially targeting the 500,000 Italian households not served by the terrestrial signals.
Italy’s Communications Authority intervened in 2009, opening an investigation that ended with a commitment of RAI “to provide users who regularly pay the TV license fee and who make the request with the TivuSat smart card by the end of February 2010”. At that point, Sky Italia instigated legal proceedings, with both the TAR and State Council establishing that the behaviour of RAI was unlawful and that commitment made by RAI to the Authority constitutes “illegal state aid”.