The Government has decided not to take any action against RTÉ on how it uses the licence fee after a report cleared the station of abusing its dominant position. Emmet Oliver reports.
Private broadcasters, especially TV3, have long maintained that RTÉ uses its licence fee revenue to artificially suppress advertising rates. The State-owned broadcaster has also been accused of paying "excessive" prices to purchase programmes in a bid to deprive competitors of the same material.
However, a report by consultants has not provided support for these allegations, despite TV3 providing a detailed dossier of what it calls evidence of predatory pricing. The consultants who prepared the report were Europe Economics, Curtin Dorgan Associates and PricewaterhouseCoopers.
The report was submitted in recent days to the Minister for Communications, Mr Dempsey. He said yesterday that he had brought the report to the attention of the Government and, in view of the conclusions, "it is not intended to take any further action".
He said the report made it clear there was no evidence that RTÉ was using the licence fee "to act in an anti-competitive manner in relation to the purchase of programming rights or in relation to the selling of advertising".
Earlier this year, the Competition Authority also rejected TV3 claims that RTÉ was abusing its position in the market. However, attention now turns to a State-aid investigation by the EU Commission, which is expected to issue sometime in the spring.
RTÉ said it welcomed the vindication contained in the report. A statement said the report complemented the findings of a Competition Authority investigation from earlier this year.
"The allegations, which prompted these two reports, made in relation to how RTÉ uses public money and conducts its business have been unfounded. RTÉ is committed to continuing to operate in an open and transparent manner, and configures its annual report to maximise the information made available," said a statement.
The report does not find RTÉ holds a serious advantage in buying programmes, and also points to advantages TV3 has via its links with ITV, which owns 45 per cent of the station. The report says that TV3 holds the rights to the highly popular soap Coronation Street, which once aired on RTÉ, because of its link with ITV.
However, TV3 said the report would be a major setback to attempts to increase the level of competition in the broadcasting sector in the Republic.
TV3 expressed particular frustration with some of the assumptions made by the authors of the report. In the opening section, the authors suggest "the whole RTÉ schedule may be thought of as public service broadcasting". TV3 said this made the report "fundamentally flawed". It argued that such a definition had been challenged at European level.
The report claims that, overall, TV3 and RTÉ do not compete "head to head" for programming. TV3 disagreed with this finding and said competition, particularly for sports programming, was intense.
