Portugal: ERC names 12 risks in Meo-Media Capital deal
October 20, 2017
From Branislav Pekic in Rome
Portugal’s Media Regulatory Authority (ERC) has been unable to reach a consensus on the proposed acquisition of Media Capital by Meo, referring the case to the Competition Authority.
The ERC said that its three members could not define a unanimous stance on the risks to pluralism in the media sector in Portugal. In its ruling, the media regulator also indicated 13 possible risks to the operation if it should go ahead as proposed.
The first risk is the strengthening of the position of content producer Plural Entertainment, limiting the growth capacity of competitors.
The second is the risk of sharing sensitive information, such as habits and preferences of TV consumption, from rival broadcasters to TVI.
There is also the risk of damage to the autonomy and editorial independence of the media in the new group resulting from optimisation of resources and staff.
A fourth risk is the reduction of advertising revenue for competing programmes, as Meo is the second largest advertiser.
Also possible is a reduction of investments in content for TVI and the possible transfer of content to Meo’s new thematic channels.
Another risk could be the “imposing of abusive and discriminatory conditions” on competitors NOS, Nowo and Vodafone Portugal for access to Media Capital’s channels and services.
Risk number seven is the possibility of “blocking or negatively discriminating” the distribution of rival channels, such as RTP and SIC, on the Meo platform.
As Meo is also the national DTT network operator, the ERC also expressed concern of a possible conflict of interest and the risk of an increase in the distribution fees for TV channels.
Risk number nine regards the “disproportionate concentration of premium sports content”.
As Meo is the leading fixed and mobile internet provider, there is also a risk of conditioning access to third-party content on the internet in favour of its own.
Risk number eleven is “reducing the plurality and diversity of Portuguese online content” as a result of consolidation of portals/domains owned by Media Capital and Altice.
The regulator also warned that the merger could lead to the imposition of “abusive and discriminatory” conditions on rival distribution platforms in order to access Meo events.
Last but not least, the ERC questions the fact that one subject would have such a dominant position in the Portuguese media and telecom markets.
The merged company would, in fact, be the largest owner of internet portals, the biggest content producer, the second largest advertiser, the only DTT network operator, it would have a 39.7 per cent share of the multi-play subscribers, a 24 per cent share of the advertising revenue and 22.5 per cent of the radio market.