Competition opens file against Atresmedia and Mediaset for advertising concentration

The CNMC opens a file against Atresmedia and Mediaset for alleged concentration of the advertising market and non-compliance with article 1 of the Competition Defense Law (LDC).

The National Markets and Competition Commission (CNMC) has opened a file against Atresmedia and Mediaset for concentration of the advertising market and alleged non-compliance with article 1 of the Law on the Defense of Competition (LDC).

According to the terms of the investigation announced by the CNMC, there would be conditions that “could unjustifiably hinder the entry and expansion of third-party operators in the television advertising market in Spain, unduly restricting effective competition in said market.”

According to the CNMC, these practices would consist of "requiring advertisers and media agencies to comply with relative advertising investment quotas on their respective television networks and the joint contracting of television advertising on different channels of each of the two television operators, through the simulcast broadcast of the majority of the advertising campaigns, as well as the linking of packages."

The two television groups monopolize the bulk of advertising investment in Spain, which is why both the television operators with a lower market share and the regional channels had put on the table the dominant position of the two audiovisual giants.

Precisely, a few months ago the regional television stations grouped in FORTA sent a decalogue of measures to the Ministry of Energy, Tourism and Digital Agenda in which they exposed what, in their opinion, is a de facto duopoly that has caused an almost unsustainable situation. For their part, smaller operators such as 13 TV, Kiss FM, Vocento, Real Madrid TV and Unidad Editorial have also expressed on numerous occasions the unviability of the sector with an advertising pie dominated by the two large groups.

In 2017, the advertising investment of national free-to-air television stations controlled by InfoAdex stood at 1,931.4 million euros, which represents a growth of 1.0% compared to 2016. This group of television stations accounts for 90.1% of the total investment received by the medium.

Mediaset España, leader by its absolute figure, has reached an investment of 927.0 million in 2017, registering a growth of 0.9% compared to the same period of the previous year and reaching a share of 43.3% of investment in television.

As for the Atresmedia group, it obtained an advertising turnover of 887.0 million compared to 893.0 million in 2016, achieving a market share of 41.4% in 2017, which has meant a decrease in investment volume of -0.7%.

For its part, according to Infoadex, the regional governments registered 114.2 million in 2017, which translates into a share of the total investment in TV of 5.3%.

In 2017, pay channels recorded an advertising investment of 94.6 million euros compared to 81.4 million the previous year, reaching 4.4% of the medium's total advertising turnover.

From Mediaset España they have assured in a statement that "the structure of the advertising market does not differ in essence from that existing in the main European markets, with the Spanish market being a strongly competitive market."

The group also highlights "the manipulation that exists in such accusations, since today no one is unaware that the advertising investment in the Spanish audiovisual market is distributed not only in the first two free-to-air television groups, but also in international operators such as Facebook or Google, in an amount valued by different studies at around 1,000 million euros annually."

On the other hand, they emphasize that "none of the new DTT operators should be surprised by market conditions that should be well known to address a business plan. Not in vain, the operators that launched two channels such as Cuatro and LaSexta were forced a few years later to sell their licenses due to the impossibility of making them profitable."

Mediaset España considers that these accusations are absolutely unfounded, since it has no dominant position in the advertising market and, therefore, does not have the capacity to impose abusive conditions of any kind on its clients.

Finally, they recall that in February 2016, "once the advertising restrictions imposed by the CNMC after the merger of Cuatro ended, Publiespaña continues to maintain the separate sale of the Telecinco and Cuatro modules, and also markets each of the seven channels separately, even though said restrictions are no longer in force today."

Now a maximum period of 18 months will be opened for the investigation of the file and for its resolution by the CNMC