The EU accused six top Hollywood studios and Sky TV on Thursday of breaching antitrust laws by using movie licenses to block access to pay TV content in other countries in Europe.
In the latest salvo in Brussels’ bid to break down digital barriers in the European Union, it issued formal complaints against Disney, NBCUniversal, Paramount Pictures, Sony, Twentieth Century Fox and Warner Bros, as well as Britain and Ireland’s Sky TV.
The charges, made after an 18-month investigation, were announced by the EU’s steely new Competition Commissioner Margrethe Vestager and follow similar moves against Internet giant Google and Russian energy behemoth Gazprom.
“European consumers want to watch the pay-TV channels of their choice regardless of where they live or travel in the EU. Our EU economy Internet antitrust investigation shows that they cannot do this today,” Vestager said in a statement.
“We believe that this may be in breach of EU competition rules,” she said.
“The studios and Sky UK now have the chance to respond to our concerns.”
A Warner Bros spokesperson told AFP the studio is “cooperating fully” with the probe, while NBCUniversal said it was “communicating constructively with the European Commission”.
The parent company of Twentieth Century Fox, 21st Century Fox, declined comment.
In May Brussels unveiled an ambitious project to build a digital single market across the union of 28 countries and 500 million people, which as a bloc is the world’s biggest economy but sharply divided in digital terms.
European Commission chief Jean-Claude Juncker also hopes to help build cross-national media champions to take on not only Hollywood but digital giants such as Google and Facebook as well.
As part of that project, former Danish minister Vestager launched an investigation into the way e-commerce in general works across the bloc.
– High-profile investigations –
The new probe specifically calls into question copyright laws which currently allow Hollywood studios to sell their content individually to national markets, creating a divided European market in defiance of EU rules, according to the commission.
Filmmakers and actors in France furiously defend this status quo, which also helps fund the national film industry against what is seen in Paris as Hollywood’s domination of European culture.
The Commission “takes the preliminary view that each of the six studios and Sky UK have bilaterally agreed to put in place contractual restrictions that prevent Sky UK from allowing EU consumers located elsewhere to access pay-TV services available in the UK and Ireland.”
Specifically, subscribers to the Sky TV’s network of channels are blocked from accessing its offerings of films and TV series once outside Britain and Ireland.
The Commission also said it was still examining similar cases involving Canal Plus of France, Sky Italia of Italy, Sky Deutschland of Germany and DTS of Spain.
Since taking office in November Vestager has made a name for herself with a series of high-profile investigations.
US-based firms, in particular tech companies, have been a particular target for Vestager amid concerns that companies across the Atlantic are distorting the EU’s single market.
But the investigations have raised deep suspicions in Washington over EU trade regulation.
They have also raised alarm in Moscow after the EU in April charged Gazprom with abusing its dominant market position in Europe, risking a new battle with Russia amid tensions over Ukraine.