CCI orders investigation into Star India Private Limited alleged of abuse of dominant market position
The Competition Commission of India (CCI) ordered the investigation into Star India Private Limited alleged of abuse of dominant market position.
Background
The present Information has been filed by Asianet Digital Network (P) Ltd. under Section 19(1)(a) of the Competition Act, 2002 against Star India (P) Ltd., Disney Broadcasting (India) Limited and Asianet Star Communications Private Limited alleging, inter alia, contravention of the provisions of Sections 4 of the Act.
Arguments
The informant stated that to circumvent the New Regulatory Framework and grant additional discriminatory discounts to KCCL, OP-1 has entered into marketing agreements with KCCL whereby OP-1 pays KCCL for advertising which apparently is an admitted fact by OP-1 in one of its communications.
It is also averred that it is claimed by OP-1 that the subscription agreement and marketing agreement are two independent transactions and that ADNPL is attempting to link two different transactions with malafide intentions.
The Informant contended that OP-1 is in a dominant position on account of its significant market share, size and economic resources since it is a part of the global media conglomerate, dependence of consumers and its countervailing power.
Decision
The coram of Chairperson Ashok Kumar Gupta, Member Sangeeta Verma, Member Bhagwant Singh Bishnoi, observed that the main thrust of the allegations levelled by the Informant is that by offering additional discounts to select MSOs and the main competitor of ADNPL in Kerala viz. KCCL, OP-1 has placed the MSOs like ADNPL at a huge disadvantage which is detrimental to the competition and competitors in the market. Such conduct by a dominant player is alleged to be violative of the provisions of Section 4 of the Act as it not only amounts to imposition of unfair/ discriminatory prices but also denies market access to the Informant, besides distorting the level playing field in the market place and hindering the ability of the players to compete in an effective manner.
The Commission prima facie noted that the relevant product market is “market for provision of broadcasting services” as OP-1 is engaged in providing the services of broadcasting satellite-based TV channels in India. Furthermore, since the very premise of the Informant is price discrimination between its various distributors in the State of Kerala and also keeping in mind factors such as language and consumer preferences, the relevant geographical market is ‘State of Kerala’. Hence, the relevant market prima facie appears to be ‘market for provision of broadcasting services in the State of Kerala’.
The Commission directed the Director General (DG) to cause an investigation to be made into the matter and submit an investigation report within a period of 60 days from the date of receipt of this order.
Case title: Asianet Digital Network (P) Ltd. v/s Star India Private Limited and Ors.
Citation: Case No. 09 of 2022
