Case Presentation on

Shri Yogesh Ganeshlaji

Somani
Vs.
Zee Turner Ltd.(OP I)
&
Star Den Media Services
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SECTIONS INVOLVED
Section 26(6) of the Competition Act, 2002:Procedure for inquiry on complaints under
section 19.
Section 19 of the Competition Act, 2002:Inquiry into certain agreements and dominant
position of enterprise.
Section 3 of the Competition Act, 2002:Anti-competitive agreements.
Section 4 of the Competition Act, 2002:Abuse of dominant position.
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PARTIES
Shri Yogesh Ganeshlaji SomaniInformant
Vs.
Zee Turner Ltd(OP I)
Star Den Media Services Pvt. Ltd(OP II)
(OPI + OPII = Mediapro)
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FACTS
Informant is a subscriber.
Opposite Party No. 1 is a joint venture between Zee
Entertainment Enterprises Ltd and Turner International India
Pvt. Ltd. (74:26).
Opposite Party No. 2 is also a JV of STAR and DEN. (50:50).
Note:- came to know from the newspapers and other news

items that Opposite Parties No. 1 & 2 were forming a 50:50

joint venture company, namely, Media Pro Enterprise India
Pvt. Ltd. (JV).
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Relevant market
In the instant case is whole of India as both
Opposite Parties No. 1 & 2 are leaders in
distribution of channels in India.

It has been alleged by

Informant that both
Offers channels in 17 genres. Opposite Parties are
being market leaders and
also being pioneers in
OP I : OP II :: 29 : 34
India have better
Total = 63
bargaining power due to
acceptability of content
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by viewers across India

Facts Cont..
The channel distribution industries was worth Rs.2500
crore of which share of Opposite Party No.1 was about Rs.
800 crore and share of Opposite Party No. 2 was about Rs.
1000 crore which is 70% of the market in total.
The Informant has alleged: creation of JV would strengthen their position
by adversely affecting the competition in the
market.
would force the small players to shut down or
to join hands with each other.
would adversely affect the interests of
distributors which will directly or indirectly
affect consumers.
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Alleged that
the said JV would be much stronger intermediary in the
market which would be able to kill the competition as
after subscribing channels out of 63 channels offered.
The MSOs, LCOs, DTHOs & IPTVOs would not be
having enough financial capacity to subscribe channels
of other broadcaster.
Other channels not in JV will lag behind.
The holdings and their related LCOs would be getting
preferential rates for the channels of JV and packaging
treatment in comparison to other distributors in the
market.
Consumers would not be able to get competitive rate
and there will exist undue advantage by JV.
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DG Report
For the purpose of relevant market
DG has assessed the broadcasting industry and
reported that the supply chain of the Indian
broadcasting industry.
DG has also examined the structure of the Industry in
India.
Market Increased i.e. no. of channels.
Levy of carriage fee.
MSOs have devised carriage fees as essentially a
strategy, where such scarce frequency for carrying
the channel is sold at a premium by the MSO/LCO to
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the broadcaster/intermediary.

DG Report Cont..

Levy of Placement Fee.

MSOs also charge placement fees from the
broadcasters/distribution alliances for placing
their channels in a particular frequency.
Note :- That MSOs earn more from placement
fees rather than subscription revenue.
Service provided by aggregators and no. of
aggregators present in market.
Total aggregators = 24
Existence of alternative i.e. cable TV and DTH
is interchangeable/ substitutable from the
consumer side.
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Findings
Fixing of price in the market or controlling the supply is
not possible.
JV < Market
As JV compromises less than 40% of the Market
Preferential treatment to their subsidiaries :- Governed
by RIO regime(broadcasters are under obligation to file
Reference Inter Connect Offer (RIO) under Clause 13.2 of
TRAI Regulation)
Any person aggrieved on account of discrimination by
the broadcaster or its agent can get its grievances
redressed by approaching appropriate forum i.e. TDSAT
for redressal of his grievances.
In Clause 3.2, 3.3, 3.4 and 3.5, specific directives have
been issued with regard to distribution of channels on
Non-discriminatory terms.
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Findings

Must provide :as there is an obligation on the part of

JV to must provide all the channels to
MSOs/ DTHOs, however, there is no
must carry obligation for downstream
players.
Cannot be said less choice provided
to
consumers
as
bouquet
composition because of JV has
increased from 9 to 16.
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Held
Relying on proviso 3(3) of the Competition Act 2002
that provides an exemption to agreements entered into
by way of joint ventures, in the event that such joint
ventures increase efficiency in production, supply,
distribution, storage, acquisition or control of goods or
provision of services.
The Commission came to the conclusion that based on
the nature of the market structure and the circumstances
under which the joint venture was formed, efficiency
reasons justify it in the facts of the case.
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Held cont.
Accordingly, the Commission notes
that since, the JV formed by the
Opposite Parties is not dominant in
terms of section 19(4) of the Act in the
relevant market; it cannot abuse its
position.

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