Why DStv was allowed to drop four E-tv channels

The Competition Tribunal has released its reasons for dismissing eMedia’s application to force MultiChoice to keep four of its channels on DStv.

In early March 2022, DStv first announced it would stop airing the E-tv Extra, eToonz, eMovies, and eMovies Extra channels from the next month.

It halted the move after eMedia brought an application for interim relief with the Tribunal.

eMedia sought an order to stop MultiChoice from dropping the channels for six months or until the outcome of its main application to have the channels restored.

The E-tv owner argued that MultiChoice’s actions amounted to a refusal to supply a scarce service and claimed it would suffer significant financial harm due to a loss of advertising revenue.

DStv refuted these claims and said the decision was based on commercial considerations.

The Tribunal ruled against eMedia and DStv cut the channels without further warning to viewers at the start of June 2022.

According to the Tribunal, eMedia had not demonstrated the financial harm it would suffer was sufficient to establish competitive harm.

The Tribunal has now explained the following three conditions had to be met to constitute exclusionary conduct on the part of MultiChoice:

  • There must be a refusal to supply goods or services to a customer or competitor.
  • The refusal to supply must be in respect of scarce goods or services.
  • It must be economically feasible for MulitChoice to supply.

Based on the elements above, the Tribunal said eMedia had not established that MultiChoice’s behaviour amounted to a refusal to supply an input to a downstream competitor or customer since MultiChoice was not a supplier of inputs to eMedia.

It also failed to demonstrate that MultiChoice’s behaviour was refusal to supply a competitor access to the DStv platform since MultiChoice argues that it does not provide access to the technical platform services and is only obligated to carry the public broadcasting services channels.

Furthermore, eMedia could not show that “basic satellite television services” were scarce, the Tribunal stated.

Because eMedia could not establish there was a refusal to supply a service or that the service was scarce, its claims that it was economically feasible for MultiChoice to carry the channels were redundant.

“The Tribunal concluded that granting interim relief may unduly alter the state of competition in the market in favour of eMedia to the exclusion of other competitors in the market,” the Tribunal said.

“This would not be consistent with the Tribunal’s role to intervene to prevent damage to competition in the market as a whole, rather than damage to a competitor.”

The Commission added that a full investigation and oral evidence may or may not confirm evidence of harm against eMedia.

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Why DStv was allowed to drop four E-tv channels