Report clears RTÉ of being anti-competitive
An independent report commissioned by the Government, which was published yesterday, has found no evidence to suggest the national broadcaster has used revenue from licence fees to behave in an anti-competitive manner.
The latest review was carried out as a condition of the Government’s decision to award RTÉ a €2 increase in licence fee to €152 in December 2003. Such revenue accounts for around 50% of RTÉ’s total income, which amounted to €312 million last year.
The findings will represent a blow for TV3 which has long argued that the State broadcaster has abused its dominant position and engaged in below-cost selling due to its access to licence fee revenue.
However, Communications Minister Noel Dempsey said yesterday that the Government intended taking no further action.
Mr Dempsey is engaged in the process of determining whether to grant RTÉ another licence fee increase for 2005. Under a formula agreed by his predecessor, Dermot Ahern, the Government is obliged to award an increase linked to inflation provided RTÉ delivers on a “statement of commitments”.
The report, which focused mainly on the TV sector, examined the potential impact of licence fee income on both the acquisition of programming rights and on advertising rates.
However, it found no evidence that RTÉ systematically outbids commercial broadcasters in the acquisition of foreign programmes. It noted that the station and its main rival, TV3 rarely competed head-to-head for the same TV rights.
The report rejected claims by TV3 that RTÉ’s dual sources of income enabled it to drive advertising rates down to the detriment of other broadcasters.
The conclusions of the report, which were carried out by a team led by the London-based firm, Europe Economics, largely match those of a similar earlier investigation carried by the Competition Authority.
Welcoming the latest findings, RTÉ said they vindicated the funding of public service broadcasting through the licence fee.
“The allegations, which prompted these two reports, made in relation to how RTÉ uses public money and conducts its business have been unfounded,” said RTÉ in a statement.
TV3 expressed disappointment at the report which it described as “fundamentally flawed”. TV3 disagreed with the report’s use of RTÉ’s definition of public service programming which is being challenged at EU level.
It “utterly refuted” the finding that broadcasters do not generally compete head-to-head. “In regard to sports rights, in particular, competition is intense,” said a spokesperson for TV3.
