Swiss competition authority WEKO has imposed a CHF71.8 million (€64.6 million) fine against telco Swisscom for anti-competitive behaviour in the pay-TV sports rights business.
With its subsidiaries Cinetrade and Teleclub, Swisscom would dominate the market in particular in the area of live transmissions of games of the Swiss football and ice-hockey leagues and international football competitions on pay-TV as it holds long-term and comprehensive exclusive rights for sports content, according to WEKO.
The competition body accuses Swisscom of having misused its market-dominating position in several aspects. For example, the company had denied several competitors any offer for the distribution of live sports on their platforms. Other competitors like UPC Cablecom were only granted access to a limited sports portfolio by Swisscom. Furthermore, competitors – in contrast to Swisscom itself – were only allowed to offer their customers sports content bundled with the Teleclub basic package.
With these practises, Swisscom gained an advantage in the competition among TV platforms in an illegal way, ruled WEKO.
Swisscom and Cinetrade rejected the accusations, arguing that they are convinced that they have acted rightfully in the marketing of sports rights and that the fine is unjustified.
TV sports rights were, like in other countries, allocated periodically in an open procedure in which further interested parties such as cable operators could participate, according to the companies. The high investments by Swisscom and Cinetrade in the past years in order to offer previously neglected sports transmissions in Switzerland as attractive content on pay-TV would justify an extended sports offering on the Swisscom TV platform. This was the only way for the investments to be sufficiently protected, argue the companies.
Only through Swisscom’s entry into the TV business in 2006, consumers had obtained an alternative “in the environment of the Swiss TV market monopolised by cable operators” leading to intense competition, according to the statement. As part of this competition, Swisscom and Cinetrade/Teleclub have gradually built up comprehensive live coverage of the Swiss football and ice-hockey leagues. Sports fans would therefore benefit today from a broader offering of live transmissions both on free-to-air TV and pay-TV, both on the Swisscom TV platform and on cable networks.
Swisscom announced that it would take action against the WEKO ruling at the Federal Administrative Court and, if necessary, the Federal Supreme Court.
UPC Cablecom welcomed the competition authority’s decision, but added that it was unfortunate and incomprehensible that Swisscom has not been forced to instantly start negotiations to make the sports content available to the customers of other platforms.