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Germany: Leading TV Sales houses face anti-competition fines
Date: 02/12/2007
The German Cartel Office's investigation involving Germany's two leading TV sales houses has concluded, with official confirmation of fines of 96€ million for IP Deutschland GmbH (RTL) and 120€ million for SevenOne Media GmbH (Pro7Sat.1).
According to the Cartel Office, sufficient evidence was gathered confirming that IP Deutschland and SevenOne Media effectively formed a cartel. The two media sales houses had agreed share deals with media agencies and were rebating them on 100% of their clients' investment with them. This unfairly drove media agencies away from spending with smaller media owners and effectively shut out new entrants into the market. This went against anti-competitive compliance policy in Germany and Europe as a whole.
WFA's local member, the German National Advertiser Association (OWM) was instrumental in voicing marketers' concerns to the Cartel Office, who earlier this year investigated the claims of anti-competitive behaviour.
Last month the two media owners accepted these fines and, in response, said they would no longer agree to ‘share deals' and made changes to their approaches to remuneration.
OWM has called for these responses to be more ambitious, flexible and consistent and that some basic requirements be achieved, i.e. full transparency for advertisers, no agency remuneration from media owners. If calls for additional changes are successful, these will likely be brought into effect next year in time for 2009's contract negotiations.
The significance of these changes in Germany may have ramifications for remuneration models and approaches to negotiations in other markets, particularly those with a similar media landscape to that in Germany.
WFA will continue to keep members informed of relevant developments in Germany and other markets via the Media Committee. For more information on how the Cartel Office's ruling will impact this market, please contact [email protected]
