The Competition Commission has elected not to refer complaints against pay-television operator MultiChoice and its SuperSport subsidiary to the Competition Tribunal, saying there are “no reasonable prospects of success and a regulatory intervention would be more effective”.

However, the commission warned that there is “potential market failure” in subscription television in South Africa due to several factors, including a lack of credible alternative buyers to SuperSport for premium sports rights.

Between 2012 and 2017, the commission received several complaints about abuse of dominance by MultiChoice and SuperSport. “While the commission is concerned of the likely market failure, it is of the view that there can be more targeted regulatory interventions to foster competition and make this market competitive,” it said in a statement.

Other factors that could result in market failure include the highly concentrated nature of subscription television; high barriers to effectively enter the market and the inability of other existing firms to expand in the market; overly long and exclusive contracts between MultiChoice and some content suppliers; and a lack of credible alternatives to which individual consumers can turn to should they wish to switch away from MultiChoice, it said.

The commission said it hopes an inquiry by communications regulator Icasa into subscription broadcasting services, currently taking place, will help address these concerns. It said Icasa’s investigation covers a “greater scope” than the complaints the commission received.

It said it will contribute to the Icasa inquiry and support its work in line with the memorandum of understanding between the two regulators.  — © 2019 NewsCentral Media