The Competition Commission alleges that MultiChoice colluded with its former decoder supplier Altech to prevent it from competing directly with DStv in pay TV.
MultiChoice influenced Altech to strip down its Node decoder, cutting competition with DStv, the commission says. The Competition Commission says it has an agreement supporting its allegation that MultiChoice colluded with its former decoder supplier Altech .
The commission alleges MultiChoice used its position as a major customer to pressure Altech into launching a stripped-down version of the platform, preventing it from competing directly with DStv in pay TV. Altron, Altech’s parent at the time, argued that the platform operated in a different market from MultiChoice’s DStv.
At the time, MultiChoice sourced its decoders from Altech.that MultiChoice had influenced Altech not to compete in pay TV after it discovered the Node was meant to have this capability.against MultiChoice South Africa and Altech to the Competition Tribunal for prosecution. The body is seeking an order declaring that MultiChoice, now a unit of French broadcaster Canal+, and Altech contravened the Competition Act.
The referral, filed on April 15, suggests the parties conspired to divide markets, which is a contravention of the law.
“We have the agreement, and that agreement has been in place for quite some time… formalised in 2014,” Mohlala said in an interview. “That agreement effectively prevented Altech from entering the pay-TV market. Altech developed the decoder that they the Node, which they intended to launch, and that decoder was going to give the offerings that MultiChoice decoders… were able to offer in the market.
“When MultiChoice discovered that — at the tail end of Altech’s launching programme — they objected to Altech launching that decoder. And because of their bigger size as a customer, they managed to get Altech to agree, as their supplier, that they are not going to enter the pay TV market and compete with them.
“ agreement of that nature that prevents a potential competitor from entering the market and competing divides the market and contravenes section 4 of the Competition Act. ” If the commission wins the case, the two companies would be liable for an administrative penalty of up to 10% of their respective annual turnover. The commission has put the ball in the companies’ court to resolve the matter because any large sums have to be handed over.
“We always say that our doors are open for anyone who wants to negotiate settlement of a contravention of this nature,” Mohlala said. “We are saying the same to MultiChoice . They can approach us and tell us what is it that they can offer us in order to resolve this matter and we are prepared to listen to their proposals. ” The commission investigates competition matters, while the tribunal makes legally binding rulings on cases referred to it.
Multichoice Altech Node Decoder Dstv Competition Commission Collusion Pay TV Competition Act Market Division
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