European Commission Seeks to Regulate Collection Societies

COMPETITION/COPYRIGHT Record Labels, Music Publishers The European Commission has launched consultations with a view to regulate collection societies which manage the marketing of copyrighted products such as CDs and DVDs. Collection societies act as trustees for rights holders, but the way they function may vary considerably within the EU and is an obstacle for businesses, the Commission said. This view is supported by the European ICT industry association (EICTA) which says many collection societies are actually slowing down businesses that distribute content online because they have to negotiate with one or more collecting societies in each country to obtain the rights to use content in that territory. EICTA is advocating official recognition and large-scale adoption of Digital Rights Management (DRM) systems. DRMs are used to protect and secure payments of online material such as music. They are based on direct licensing agreements which means that collecting houses could end up being bypassed because the products’ copyright would be managed directly by software. But the Commission paper says that those technologies have not yet been developed to a satisfactory level. It states that “a necessary pre-condition for their development is their interoperability and acceptance by all stakeholders, including consumers”. The EICTA…

Microsoft To Settle Class Actions, Record Labels Face Scrutiny
Competition , Record Labels / December 2003

COMPETITION Computer Software, Telecommunications, Record Labels Microsoft has agreed to settle class action lawsuits from a number of US states which alleged that the software giant abused its dominant market position. Microsoft are handing out discounts worth approximately USD $200 million to consumers and schools in several US states including Kansas, North Dakota, South Dakota and Tennessee. The Times(29/10/03) estimate that Microsoft has paid out more than $1.5 billion over the last ten years in anti-trust and competition payments. Microsoft is now facing further actions from the US Government and state justice departments who have raised concerns the world’s largest software maker is trying to use its dominant Windows operating system to influence where customers buy their music online. If action is brought, it will be the first test of Microsoft’s unique and federal Court approved anti-trust settlement. The Justice Department and 19 state attorneys general have formally complained to a federal judge about a design feature of Windows that compels consumers who buy music online to use only Microsoft’s Internet Explorer browser and steers them to a web site operated by the company. Microsoft is also now facing competition investigations from the European Commission. In another anti-trust action, the five…

Granada and Carlton Free to merge
Competition / November 2003

COMPETITION LAW Television In a move which surprised many industry commentators, ITV giants Granada and Carlton are to merge to form a single ITV in England and Wales. The companies were given outline permission by the Trade and Industry Secretary, Patricia Hewitt, with only limited restrictions. The Competition Commission had advised the minister that the merger would not breach competition laws provided there are conditions attached to the way advertising is sold. At one point it seemed likely that the merged group would not be able to sell its own advertising as the new entity would control 52% of all UK television advertising as the new entity would control 52% of all UK television advertising (worth more than £3 billion). The Competition Commission have recommended a series of rules to prevent market abuse. As well as restrictions on advertising sales, the merged ITV group must agree to a package of safeguards to protect the protect the remaining three independent channel 3 broadcasters – The Scottish Media Group (Scotland), Ulster (Northern Ireland) and Channel TV (Channel Islands). In response ITV’s main commercial rivals in the UK (Channel 4, Five, BSkyB and Flextech’s ‘UK’ channels) are considering a joint advertising sales house….

Competition , Live Events / February 2003

COMPETITION Radio, Live Concert Industry Democrat Senator Russ Feingold has reintroduced his Competition in Radio and Concert Industries Act on January 28th 2003 which he says will help consumers, small and independent radio station owners, and independent concert promoters by prohibiting anti-competitive practices in the radio and concert industries. The Bill’s introduction comes as the Senate Commerce Committee holds a hearing on the problems of radio consolidation. Insiders say committee chairman, Republican Senator John McCain, is expected to sign on as a co-sponsor of the bill soon. The Committee expects to hear from representatives of leading radio station owner and concert promoter Clear Channel Communications, the National Association of Broadcasters, the Recording Artists Coalition and the Future of Music Coalition. Says Feingold: “Since originally introducing this legislation in June 2002, I have seen a groundswell of interest both in Congress and among artists, consumers, independent radio stations, and local promoters in restoring fairness to radio. My legislation will reduce concentration and crack down on anti-competitive practices, such as the new ‘pay to play’ system.” Feingold says the latter practice allows radio giants to “shake down the music industry.” See See