ITWire

The ACCC has been mulling over the proposed deal for almost a year - far longer than Foxtel anticipated - and in early March Foxtel submitted a draft undertaking to the ACCC in which it proposed not to enter into exclusive content agreements to acquire IPTV rights for a range of attractive content so as to allow that content to be made available to existing and future competitors of Foxtel and Telstra.

However the proposal did not apply to premium domestic sports content and Foxtel would have retained the ability to acquire exclusive rights for the distribution of content to mobile devices over cable, satellite and mobile networks.

The ACCC's initial response to the undertaking was that it "considers that the package of content that will be made available will be sufficient to address the competitive harm that is likely to arise as a result of the proposed acquisition."

However after receiving submissions on the draft undertaking the ACCC has decided to extend the ban on exclusivity to include any movie delivered on a transactional video on demand (TVOD) basis and exclusivity of delivery to mobile devices of content otherwise covered the non-exclusivity provisions "where those rights are sought by competitors to combine with IPTV rights."

The ACCC said: "This means that those competitors will have the opportunity to deliver a seamless and integrated package of programming across a number of devices."

However the undertaking does not prevent Foxtel from acquiring exclusive rights in relation to individual sports. The ACCC said it considered the possible anti-competitive effects of such exclusivity to be a separate issue.

ACCC chairman, Rod Sims said: "The ACCC remains alive to competition concerns in existing and emerging media markets...[and] continue to consider whether there is a need to advocate for regulatory intervention in these markets."

The ACCC said it had two main concerns with the Austar deal: that it would stifle competition in the market for the retail supply of subscription television services, particularly in relation to the developing IPTV field, and competition in the market for fixed broadband and fixed voice telephony products by enabling Telstra to offer a superior 'triple play' of fixed voice, broadband and IPTV services.

Sims, said: "By reducing content exclusivity, the undertakings will lower barriers to entry and promote new and effective competition in metropolitan and regional telecommunications and subscription television markets. Taking into account the undertaking which has been offered by Foxtel, the ACCC is satisfied that the proposed acquisition is unlikely to substantially lessen competition."