Commission européenne, DG COMP MERGER REGISTRY, 1049 Bruxelles, BELGIQUE  
Europese Commissie, DG COMP MERGER REGISTRY, 1049 Brussel,   BELGIË  
 
Tel: +32 229 -91111. Fax: +32 229 -64301. E -mail: COMP -MERGER -REGISTRY@ec.europa.eu . 
 EUROPEAN COMMISSION  
 
 
 
 
 
Brussels , 15.6.2018  
C(2018 ) 3923 final  
  
 
 
 
To the notifying party  
 
 
 
Subject : Case M. 8861 - Comcast/  Sky 
Commission decision pursuant to Article 6(1)(b) of Council 
Regulation No  139/20041 and Article 57 of the Agreement on the 
European Economic Area2 
Dear Sir or Madam,  
(1) On 7 May 2018 , the European Commission received notification of a proposed 
concentration pursuant to Article 4 of the Merger Regulation by which Comcast 
Corporation ("Comcast" or the "Notifying Party", United States)  proposes to 
acquire within the meaning of Article 3(1)( b) of the Merger Regulation  sole 
control of the whole of Sky plc  ("Sky", United Kingdom  and the "Proposed 
Transaction" ). Comcast and Sky are collectively referred to as the "Parties".3  
1. THE OPERATION  
(2) Comcast is a US listed global media, technology and ente rtainment company, 
with two primary businesses: Comcast Cable and NBCUniversal ("NBCU"). 
Comcast is present in Europe almost entirely through NBCU, which is active in 
Europe in: (i) production, sales and distribution of film and television content; (ii) 
wholesale supply of TV channels and on -demand services; (iii) CNBC, a business 
news service, as well as NBC News; (iv) the provision of television content to 
end users through NBCU’s video on demand service; (v) the licensing of its 
                                                 
1  OJ L 24, 29.1.2004, p. 1 (the 'Merger Regulation '). With effect from 1 December 2009,  the Treaty 
on the Functioning of the European Union ( 'TFEU ') has introd uced certain changes, such as the 
replacement of  'Community ' by 'Union ' and 'common market ' by 'internal market '. The terminology 
of the TFEU will be used throughout this decision.  
2  OJ L 1, 3.1.1994, p. 3 (the 'EEA Agreement').  
3  Publication in the Official Journal of the European Union No C 170, 17.05.2018 , p. 9. PUBLIC VERSION  In the published version of this decision, some 
information has been omitted pursuant to Article 
17(2) of Council Regulation (EC) No 139/2004  
concerning non -disclosure of business secrets and 
other confidential information. The omissions are 
shown thus […]. Where possible the information 
omitted has been replaced by ranges of figures or a 
general description.  
 
2 intellectual property to manufacturers and distributors of consumer products; (vi) 
minor golf -related digital businesses; and (vii) minor direct to consumer DVD , 
Blu-ray and music disk sales.4 
(3) Sky is a UK public company whose shares are listed on the London Stock 
Exchange. Sky is the holding company of a number of subsidiaries carrying on 
business in a variety of sectors predominantly in the UK, Ireland, Germany, 
Austria and Italy, including: (i) licensing/acquisition of audiovisual programming; 
(ii) TV channel wholesale supply in the UK and Ireland; (iii) retailing of 
audiovisual programming to subscribers; (iv) provision of technical platform 
services to broadcasters on Sky’s DTH platforms in the UK, Ireland, Germany 
and Austria; (v) sale of TV advertising; (vi) in the UK and Irel and, the provision 
of fixed -line retail telephony and broadband services; (vii) in the UK, the 
provision of mobile communications services; and (viii) in the UK, provision of 
access to public Wi -Fi hotspots. Sky also recently launched its over -the-top 
("OT T") subscription service ("Now TV") in Spain.  
2. THE CONCENTRATION   
(4) On 25 April 2018, Comcast published its announcement for a pre -conditional 
cash offer for the entire issued and to be issued share capital of Sky, under Rule 
2.7 of the UK City Code on Takeovers and Mergers. This constitutes the 
announcement of the intention to launch a public bid in terms of Article 4(1) of 
the EUMR.  
(5) Comcast intends to implement its offer to acquire the entire issued and to be 
issued share capital of Sky by way of a tak eover offer pursuant to the relevant 
provisions of Part 28 of the UK Companies Act 2006. Whilst Comcast’s  objective 
is to achieve 100% ownership in Sky, under these circumstances, the  offer will be 
conditional upon the receipt of valid acceptances in respe ct of Sky shares which, 
together with Sky shares that Comcast has acquired or may  agree to acquire 
(pursuant to the offer or otherwise), carry in aggregate more  than 50% of the 
voting rights normally exercisable at a general meeting of  Sky. The offer will thus 
be conditional on a minimum acceptance condition of  50 per cent, plus one share. 
The Proposed Transaction therefore constitutes a concentration pursuant to 
Article 3(1)(b) of the Merger Regulation.  
(6) The Commission notes that, b y decision of 7 April 201 7 in case M.8354 – 
Fox/Sky , it unconditionally approved the proposed acquisition by Twenty -First 
Century Fox, Inc. of the remaining shares that it does not currently own in Sky. 
                                                 
4  In the US, Comcast is also active as a broadband and cable TV provider. In the course of the market 
investigation, the Commission received third party submissions alle ging that the as a result of the 
Proposed Transaction, Comcast would engage in anticompetitive foreclosure of third party content 
over Sky's broadband network. First, the Commission notes that there is no overlap between the 
Parties for the provision of br oadband anywhere in the EEA and as a result, the Parties' market 
power will not change as a result of the Transaction. Second, Sky's market share for the provision of 
broadband services in the UK and Ireland is significantly below 30% and a number of other  
providers will continue to be active post -transaction. As a result, the Commission has not 
considered these submissions further.  
   
 
3 That transaction has not been completed yet. The current transaction in case 
M.8861 - Comcast/ Sky  constitutes a competing bid for Sky.  
3. EU DIMENSION  
(7) The undertakings concerned have a combined aggregate world -wide turnover of 
more than EUR 5 000 m illion5 (Comcast: EUR 74 437 million; Sky: EUR 15 186 
million) . Each of them ha s an EU-wide turnover in excess of EUR 250 million  
(Comcast: EUR [turnover ]; Sky: EUR [turnover ]), but they do not achieve more 
than two -thirds of their aggregate EU-wide turnover within one and the same 
Member State. The notified operation therefore has a n EU dimension  pursuant to 
Article 1(2) of the Merger Regulation . 
4. RELEVANT MARKETS  
(8) The Proposed Transaction relates to all the levels o f the TV value chain. Section 
4.1 first provides an overview of the TV value chain and the Parties activities at 
each level o f the chain. Section 4.2 onward then discusses the product and 
geographic market definition for each level of the TV value chain.  
4.1. Introduction : the TV value chain and the Parties’ activities  
(9) Audio visual (" AV") content for television (TV content) comprises all products 
(films, sports, series, shows, live events, documentaries, et c.) that are broadcast 
via TV.6 In previous decisions, the Commission has identified different activities 
in the TV value chain, namely : (i) the production and supply of TV content 
(including the supply of pre -produced  TV content and c ommissioned TV 
content); (ii) the wholesale supply of TV channels; and (iii) the retail provision of  
TV services to end customers.7 As a part of its analysi s of the Parties' activities, 
the Commission also considers the Parties’ activities in the area  of advertising  
(section 4.1.4) . 
(10) Sections 4.1.1 to 4.1.3  further describe  these levels of the TV value chain as well 
as provide  an overview of the Parties' activities at each level in the UK, Ireland, 
Germany, Austria , Italy and Spain .  
4.1.1.  Production , supply and acquisition  of TV content  
(11) This upstream level of the value chain concerns the production of new TV 
content. TV production c ompanies produce TV content for either: (i) internal use 
on their own TV channels or retail TV services if they are vertically integrated in 
the wholesale supply of TV channels and/or in the retail provision of TV services 
(that is to say, captive TV produ ction); or (ii) supply to third -party customers (that 
is to say, non -captive TV production).  
                                                 
5  Turnover calculated in accordance with Article 5 of the Merger Regulation and the Commission  
Consolidated Jurisdictional  Notice (OJ C  95, 16.4.2008 , p. 1).  
6  Commission decision of 25 June 2008 in case M.5121 News Corp/Premiere , recital 28.   
7  Commission decision of 25 June 2008 in case M.5121 News Corp/Premiere , recital 28; Commission 
decision of 7 April 2017 in case M.8354 – Fox/Sky , recital 29 .   
 
4 (12) Third -party customers are typically: (i) TV channel suppliers (TV broadcasters), 
which then incorporate the TV content into linear TV channels, or (ii) content 
platform operators, which then retail the TV content to end users on a non -linear 
basis (that is to say, Pay -Per-View ("PPV") or video on demand ("VOD")), 
including non -traditional platforms, that is to say internet or so -called Over -The-
Top ("OTT") platforms .  
(13) TV broadcasters and TV distributors who source TV content for their TV 
channels or retail TV services generally have a choice between a number of 
sourcing models, which can be broadly categorised as follows:  
a. Obtaining TV content produced on an ‘ad hoc’  basis (that is to say tailor -
made), by:  
i.  Commissioning TV content from a TV production company (which 
owns the relevant TV format);  
ii.  Hiring a TV production company to provide the technical means and 
deliver the finished TV content based on a form at owned by the 
broadcaster; or  
iii.  Producing the content themselves by relying on their in -house 
facilities (captive TV production); or  
b. Acquiring broadcasting rights from TV production companies for pre -
produced TV content (pre -produced TV content, so metimes referred to as 
off-the-shelf or tape sales).  
(14) As regards  commissioned TV content , in most cases, TV production companies 
produce TV content tailored to the needs of their customers on th e basis of 
original TV formats8 that they develop themselves o r that they acquire from right 
holders (commissioned production). However, in some instances, TV production 
companies are hired by TV broadcasters or content platform operators to simply 
provide the technical production means and deliver the finished progr amme based 
on a TV format owned or acquired by the hiring company (production -for-hire or 
supply of TV production services).  
(15) The production costs are usually borne entirely or almost entirely by the TV 
broadcasters or content platform operators. As regards  ownership of the various 
rights relating to the TV content (for example, primary TV broadcast rights, 
‘catch -up’, VOD, etc.), the extent to which those rights are retained by the 
production company – as opposed to the acquirer of TV content – may vary bas ed 
on a number of factors, such as national regulation in the country concerned, the 
type of broadcasting, the outcome of the commercial negotiations between the 
parties, etc. Producers or the acquirers of TV content may then achieve secondary 
revenues by further licensing/distributing the TV content or the TV format to 
third parties.  
(16) As regards pre-produced TV content , this upstream level of the value chain 
concerns the licensing of broadcasting rights relating to pre -existing TV content – 
                                                 
8   Commission decision of 25 June 2008 in case M.5121 News Corp/Premiere , recital 28.   
 
5 that is to say T V content that has been previously produced and is subsequently 
made available ‘off -the-shelf’ by the rights holder (so -called pre -produced TV 
content) – and broadcasting rights relating to sports events.  
(17) The broadcasting rights relating to TV content can belong to one or more of the 
following: (i) the holder of the rights to the TV format; (ii) the production 
company that produced the TV content; and (iii) the company that commissioned 
the production of the TV content. In addition, the broadcasting rights can belong 
to a third -party distributor, to which they were licensed by the original owner, 
with a right to sub -license.  
(18) As regards the supply -side of the market:  
a. Sky licenses small amounts of both commissioned and pre-produced TV 
content through its dist ribution arm, Sky Vision. It has also minimal activities 
through its Vision Distribution joint venture9 and Sky Cinema Original Films 
initiative10. 
b. Comcast  licenses both commissioned and pre-produced TV content via 
several NBCU companies (e.g. Universal Studios, Carnival Films and 
others).  
(19) As regards the demand -side of the market:  
a. Sky acquires some TV content from third party content owners and 
distributors to include in its own channels and for its content platforms;  
b. Comcast  has a minor presence in acq uisition of TV content in the EEA  to 
include in its own channels.  
4.1.2.  Wholesale supply and acquisition  of TV channels  
(20) TV broadcasters use the TV content that they have acquired or produced in -house 
in order to package it into linear TV channels. (Linear) TV channels are broadcast 
to end users either on a free -to-air ("FTA") basis or on a pay -TV basis.  
(21) At a very general level, FTA channels are TV channels that are available to 
viewers free of charge.  Pay-TV channels are channels for which the viewer must 
pay a subscription fee in order to watch. Traditionally, FTA channels finance their 
operations via advertising revenues (with the exception of the publicly -owned TV 
channels in a number of Member States which are subject to  advertising 
limitations ), while pay -TV channels generate revenues through subscription fees.  
(22) The Commission notes that TV broadcasters are increasingly complementing 
their traditional linear TV channel offering with non -linear services such as VOD  
services.11 
                                                 
9  Vision Distribution is a joint venture with five Italian independent producers (Cattleya , Wildside, 
Lucisano, Palomar, and Indian Production), focused on Italian films.  
10  The initiative was launched in 2018.  
11  VOD services can be further differentiated into three types. First, Subscription VOD ("SVOD") 
designates a service whereby the end u ser obtains the right to watch multiple titles during a 
 
 
6 (23) Some TV broadcasters are vertical ly integrated as they are also active as retail TV 
operators (TV distributors) in the market for the retail provision of TV services to 
end users. Other TV broadcasters are not vertically integrated and rely on third 
party TV distributors to distribute the ir TV channels at the retail level.  
(24) As regards the supply -side of the market:  
a. Sky supplies channels to TV distributors and also holds a 50% stake in 
channel provider A&E Networks UK, a joint venture with A&E Networks. 
Sky does not supply channels on a who lesale basis in Italy  and Austria, and 
only to very limited extent in Germany ; 
b. NBCU  supplies a range of basic pay -TV channels on a wholesale basis, 
including 13th Street, Universal Channel, Sy Fy, E!, CNBC and Movies24 . 
(25) As regards the demand -side of the mar ket:  
a. Sky enters into agreements with TV broadcasters for the distribution of TV 
channels in the UK, Ireland, Germany, Austria and Italy ; 
b. Comcast  does not acquire TV channels.  
4.1.3.  Retail provision of TV services to end users  
(26) TV distributors either limit themselves to carrying TV channels and making them 
available to end users, or also act as channel aggregators, which ‘package’ TV 
channels. The TV services supplied by TV distributors to end users consist of: (i) 
packages of linear TV channels (which they have either acquired or produced 
themselves); and (ii) content aggregated in non -linear services, such as VOD, 
SVOD, TVOD and PPV. TV content can be delivered to end users through a 
number of technical means includ ing cable, satellite and IPTV.12 OTT players 
deliver channels and content in both a linear and non -linear fashion through the 
use of the internet.  
(27) The content offered by the TV distributor is presented in an electronic programme 
guide ("EPG"), which is an application used on television s ets to list current and 
scheduled programmes that are or will be available on each channel and a short 
summary or commentary for each programme. Each channel broadcast on the TV 
platform receives an EPG position, which is usually agreed between the TV 
broadcaster and the TV distributor. Traditional EPGs are not always used with 
                                                                                                                                                 
designated time period, for instance one month, through a single payment. Second, Transactional 
VOD ("TVOD") designates a service whereby the end user obtains the right to watch a single 
selected titl e within a designated time frame, for instance within 24 hours, through a single 
payment. Third, pay per view ("PPV") designates a service whereby the end user makes a payment 
to watch a single title that is being broadcast at a specific time, which is the  same for all viewers. In 
the case of TVOD and SVOD, viewers can select, purchase and view the titles at times of their own 
preference, whereas in the case of a title available for PPV, viewers purchase the right to watch that 
title at the given time it is  broadcast, which is the same for everyone (for instance, the right to watch 
the live broadcast of a football match can be purchased for PPV).   
12  IPTV is the abbreviation for Internet Protocol TV; it is a system through which television services 
are deli vered using the Internet protocol over a packet -switched network such as the internet, 
instead of being delivered through traditional terrestrial, satellite signal and cable television formats.   
 
7 regard to online content platforms and other non -linear methods of supplying 
content, or may form only part of a TV distributor's customer interface.  
(28) In the retail provision of TV se rvices to end users:  
(a) Sky offers retail services in the UK, Irel and, Germany, Austria and Italy,  
retailing its own and third party linear pay -TV channels and VOD programming 
via DTH satellite, OTT and mobile technologies to end customers. Sky also 
broadcasts a limited number of FTA channels: Sky News International (available 
across much of Europe); in the UK and Ireland, Sky News, Sky News Arabia, 
Challenge, Pick and the Sky Intro channel; and in Italy, Cielo and TV8. Sky’s TV 
services on an OTT basis i nclude NowTV in the UK, Ireland13 and Italy, “Sky 
Ticket” in Germany and Austria, Sky Go (which is an OTT service available to 
DTH subscribers) and services operated under the Sky brand in Spain, which 
enable the end user to access Sky TV content in a linea r and/or non -linear manner 
on big screen and small screen mobile devices without requiring a cable or 
satellite connection with Sky.  
(b) NBCU  supplies on demand service  hayu  in the UK and Ireland . It also offers 
limited direct sales to clients from licensi ng the CNBC linear channel  in the UK, 
Ireland, Germany, Austria and Italy . 
4.1.4.  Advertising  
(29) Advertising space can be provided through various media, including newspapers, 
TV airtime, radio or online advertising.  
(30) When it comes to online advertising , the online a dvertising value chain has, on 
the supply side, ad publishers (including broadcasters and website owners); and 
on the demand side, advertisers, media buyers and advertising agencies. The ad 
publishers have advertising inventory available (i.e. “spaces” on their websites, 
videos or other digital assets) that they seek to monetise. The demand -side players 
seek these spaces on which to display their advertisements. Intermediaries, ad 
networks and ad exchanges sometimes operate in between those two markets.  
(31) Once advertising space has been sold by a publisher to an advertiser, either 
directly or through an intermediary, both parties need to ensure that the correct ad 
actually appears (i.e. is served) onto the publisher website space at the right place 
at the righ t time. This step is undertaken by the ad serving tools.  
(32) Both Parties are active in the supply of TV advertising airtime. Sky is also active 
in selling online advertising space, including targeted advertising (through Sky 
AdSmart) and multiplatform adverti sing (through Sky Advance). Apart from that, 
Comcast provides online display ad serving technology (through FreeWheel).  
                                                 
13  A difference between standard Sky retail TV services and NowTV is the method of distribution. 
NowTV customers also have more limited access to content compared to regular Sky TV customers. 
NowTV customers gain access to content via subscriptions to “passes” which allows them to view 
pre-defined blocks of linear TV channels and on -demand content.  
 
8 4.2. Production , supply and acquisition of TV content  
4.2.1.  Product market definition  
4.2.1.1.  Commission precedent s 
(33) With regard to the market for the suppl y of TV content, in previous decisions the 
Commission has concluded that there are separate markets for the: (i) production 
and supply of commissioned TV content; and (ii) licencing of broadcasting rights 
for pre -produced TV content.14  
(34) With regard to the m arket for licencing of broadcasting rights for TV content, the 
Commission has considered that it could be subdivided by content type, in 
particular: (i) films; (ii) sports; and (iii) other TV content (i.e. all non -sport, non -
film content); and potential su b-segments within these content types. Ultimately, 
the Commission left the exact scope of the product market open.15 
(35) The Commission has also considered further sub -dividing the market for the 
licensing of broadcasting rights for TV content by exhibition window: (i) 
subscription video on demand ("SVOD"); (ii) transactional video on demand 
("TVOD"); (iii) pay -per-view ("PPV"); (iv) first pay -TV window; (v) second pay -
TV window; and (vi) FTA; but left the market definition open.16  
4.2.1.2.  Notifying Party’s view  
(36) The Notifying party submits that , notwithstanding potential sub -divisions  of TV 
content , if a company  is only active in the production of one type of content (in 
particular, film  content) it would be able to start producing sports content and/or 
other TV  conte nt within a short timeframe and without incurring significant 
additional  costs. Moreover, there is no material difference from a demand -side 
perspective between US films and non -US films since both types compete to  
attract the same viewing audience in the EEA.  Accordingly, it is the Notifying 
Party’s view that the distinction in the Commission’s decisional practice by 
                                                 
14  Commission decision of 24 February 2015 in case M.7194 Liberty Global / Corelio / W&W / De 
Vijver Media, recital 69. See also Commission decision of 16 September 2014 in case M.7282 
Liberty Global/Discovery/All3Media , recital 41 and Commission decision of 9 October 2014 in case 
M.7360 21st Century Fox/Apollo/JV , recital 40.   
15  Commission decision of 7 April 2017 in case M.8354 – Fox/Sky,  recital 67 ; Commission decision of 
21 December 2011 in case M.6369 HBO/Ziggo/HBO Nederland and Commission decision of 24 
February 2015 in case M.7194 Liberty Global / Corelio / W&W / De Vijver Media, recital 69; 
Commission decision of 21 December 2011 in case M.6369 HBO/Ziggo/HBO Nederland , recitals 
18–20; Commission deci sion of 15 April 2013 in case M.6880 Liberty Global/Virgin Media , recital 
19. Moreover, as regards sports, the Commission has also previously considered a distinction 
between football and other sports and further distinctions within football, for example b etween 
regular football events and football events that are played more intermittently (Commission decision 
of 18 January 2007 in case M.4519 Lagardère/Sportfive , recital 10). As regards films, the 
Commission has considered distinguishing between US -produc ed films and other films 
(Commission decision of 2 April 2003 in case M.2876 News Corp/Telepiù , recitals 58 and 61).   
16  Commission decision of 24 February 2015 in case M.7194 Liberty Global / Corelio / W&W / De 
Vijver Media, recital 69; Commission decisi on of 21 December 2011 in case M.6369 
HBO/Ziggo/HBO Nederland , recital 18; Commission decision of 16 September 2014 in case 
M.7282 Liberty Global/Discovery/All3Media , recitals 46 –48; Commission decision of 9 October 
2014 in  case M.7360 21st Century Fox/Ap ollo/JV , recitals 45 –47, Commission decision of 10 
October 2014 in case M.7000 Liberty Global/Ziggo , recitals 38 –44.   
 
9 content type may not necessarily reflect conditions of competition from a supply 
or demand side perspective.  
(37) Moreover,  the Notifying Party  does not believe that it is necessary formally to 
distinguish the licensing of broadcasting rights by exhibition window (SVOD, 
TVOD, PPV, first pay -TV window, second pay -TV window or FTA) for the 
purpose of market definition since suppliers of TV content do not produce 
different types of TV content designed for different exhibition windows, and the 
content licensed in each window is broadly substitutable from a demand side 
perspective.  
4.2.1.3.  The Commission’s assessment  
(38) The results of the market investigation indica te that , although content providers 
did not provide definitive views,  most broadcasters and retail providers of 
audiovisual services consider the segmentations adopted in prior Commission 
decisions  (by content type and exhibition window  as indicate d above ) still 
relevant.17  
(39) In any event , for the purpose of this decision, the exact product market definition 
for the production and supply of TV content can be left open, as the Proposed 
Transaction does not raise serious doubts as to its compatibility with the internal 
market regardless of whether the market is segmented on the basis of content type 
or exhibition window.  
4.2.2.  Geographic market definition  
4.2.2.1.  Commission precedent s  
(40) In past decisions, the Commission has defined the market for the production and 
supply of TV content, including production of TV content and the licensing of 
broadcasting rights for TV content to be either national or regional, based on 
linguistically homogeneous areas.18  
4.2.2.2.  Notifying Party’s view   
(41) Comcast submits that the relevant geographic mark et for the production and 
supply of TV content, including any narrower segmentation thereof, is national in 
scope. This delineation reflects the nature of the typical licensing relationship 
between the supplier of the TV content and the licensee. In partic ular, Comcast 
considers that the majority of licensing relationships are concluded at the national 
level, with some exceptions in which the licensee obtains broadcasting rights to 
multiple countries/regions with a common language. Moreover, in many cases, 
supranational considerations are not relevant given many broadcasters 
(particularly FTA broadcasters) are only active in one Member State. 
                                                 
17  Replies to Questionnaire Q 2 to TV broadcasters of 7 May 2018, part B; Replies to Questionnaire Q 3 
to TV distributors of 7 May 2018, pa rt B. 
18  Commission decision of 7 April 2017 in case M.8354 – Fox/Sky , recital 74 ; Commission decision of 
21 December 2010 in case M.5932 News Corp/BSkyB , recitals. 73 –75; Commission decision of 15 
April 2013 in case M.6880 Liberty Global/Virgin Media , rec ital 24. Commission decision of 24 
February 2015 in case M.7194 Liberty Global / Corelio / W&W / De Vijver Media , recitals 73 -76.   
 
10 Accordingly, it is more appropriate to delineate the geographic scope of the 
market based on national, rather than li nguistic, boundaries.  
4.2.2.3.  The Commission’s assessment  
(42) The results of the market investigation show  that most of the respondents among 
TV broadcasters and distributors purchase content nationally or for certain 
linguistic regions. Broadcasters sometimes also pu rchase content on an EEA or 
worldwide basis.19  
(43) In any event, for the purpose of this decision, the exact geographic market 
definition for the production and  supply of TV content can be left open, as the 
Proposed Transaction does not raise serious doubts as  to its compatibility with the 
internal market regardless of whether the market is considered to be national or 
by linguistic region.  
4.3. Wholesale supply and acquisition  of TV channels  
(44) TV broadcasters package the TV content that they have acquired or produced in -
house into linear TV channels. Linear TV channels are broadcast to end users 
either on a FTA basis or on a pay -TV basis. This wholesale level is an 
intermediate activity between upstream production and licensing of content, and 
the downstream retail provision of TV services to customers.  
4.3.1.  Product market definition  
4.3.1.1.  Commission precedent s 
(45) In previous decisions, the Commission has identified a wholesale market for the 
supply of TV cha nnels. Within that market, the Commission has further identified 
two separate product markets for: (i) FTA TV channels; and (ii) pay -TV 
channels.20 The Commission has further concluded that within the pay -TV 
channel market, there are separate markets for: ( i) premium pay -TV channels; and 
(ii) basic pay -TV channels . For  the purposes of its assessment , the Commission 
has considered  FTA channels to be in  the mar ket for basic pay -TV channels.21 
(46) In previous decisions, the Commission also examined a number of other  potential 
segmentations, including: (i) genre or thematic content (such as films, sports, 
general entertainment, news, youth, and others);22 (ii) linear channels vs non -
                                                 
19  Replies to Questionnaire Q 2 to TV broadcasters of 7 May 2018, question B4.  
20  Commission decision of 24 February 2015 in case M.7194 Liberty Global / Corelio / W&W / De 
Vijver Media, recital 91. Commission decision of 18 July 2007 in case M.4504 SFR/Télé 2 France, 
recitals 37 –40; Commission decision of 18 July 2007 in case M.4504 SFR/Télé 2 France, recital 40; 
Commission dec ision of 21 December 2010 in case M.5932 News Corp/BskyB, recitals 80, 83 and 
85; Commission decision of 21 December 2011 in case M.6369 HBO/Ziggo/HBO Nederland, 
recital 24; Commission decision of 15 April 2013 in case M.6880 Liberty Global/Virgin Media, 
recital 37.   
21  Commission decision of 24 February 2015 in case M.7194 Liberty Global / Corelio / W&W / De 
Vijver Media , recital 101.   
22  Commission decision of 24 February 2015 in case M.7194 Liberty Global / Corelio / W& W / De 
Vijver Media, recital 92. Commission decision of 2 April 2003 in case M.2876 Newscorp/Telepiù, 2 
April 2003, recital 76; Commission decision of 18 July 2007 in case M.4504 SFR/Télé 2 France, 
recitals 41 –42; Commission decision of 26 august 2008 in c ase M.5121 News Corp/Premiere, 
 
 
11 linear services (VOD, PPV);23 and (iii) the different means of infrastructure used 
for the delivery to the viewer (cable, satellite, terrestrial TV and IPTV).24 It has 
ultimately left the market definition open in all these regards.  
4.3.1.2.  Notifying Party’s view  
(47) The Notifying Party  considers  that basic pay -TV channels and FTA TV channels 
are broadly substitutable, since any differences in terms of content, pricing and 
licensing rights are insufficient to create a meaningful distinction. In this respect, 
Comcast notes that a programme produced  for pay -TV could just as easily play 
on a FTA platform, and is not inherently of a different type. Within basic pay -TV 
channels, as mentioned above, Comcast considers that it is not necessary to 
distinguish between channels on the basis of genres for the purposes of product 
market definition, since each of the above mentioned genres are broadly 
substitutable with one another from the consumer’s perspective.  
(48) In particular, the Notifying Party  considers that a distinction between FTA and 
pay-TV does not mak e sense with respect to news channels. Several channels 
providing news content, for example the BBC and Sky News in the UK and 
Ireland, are available on both a FTA basis and through the EPG for retail pay -TV 
services in the five Member States where Sky is primarily active. Further, within 
these Member States, the majority of news viewing tends to be undertaken on 
channels available on a FTA basis, even on pay -TV platforms. Consequently, 
FTA news channels (such as the BBC and Sky News in the UK) are in direc t 
competition with the (generally much smaller) news channels which are only 
available on a pay -TV basis (e.g. Euronews in the UK). The lack of any practical 
distinction between FTA and pay -TV news channels is also demonstrated by the 
fact that many news c hannels – including CNBC in the UK, Ireland and Italy – 
are available both FTA and via pay -TV platforms. The lack of relevance of a 
distinction between FTA and pay -TV in the news genre is further illustrated 
through the choice of several media regulatory a gencies to analyse news 
consumption at the level of “all TV” when reporting on news consumption and 
competitive dynamics within their Member State.  
4.3.1.3.  The Commission’s assessment  
(49) According to broadcasters, the distinctions drawn  between FTA and pay-TV 
channe ls as well as between basic and premium pay-TV are still relevant in the 
UK, Ireland, Germany, Austria and Italy. However, the market investigation did 
not provide definitive views on whether thematic channels are only substitutable 
with other channels that broadcast  the same specific content .25 
                                                                                                                                                 
recital 35; Commission decision of 21 December 2010 in case M.5932 News Corp/BskyB, recital 
81; Commission decision of 10 October 2014 in case M.7000 Liberty Global/Ziggo , recital 89.   
23  Commission decision of 24 February 2 015 in case M.7194 Liberty Global / Corelio / W&W / De 
Vijver Media, recital 94. Commission decision of 18 July 2007 in case M.4504 SFR/Télé 2 France , 
recital 43; Commission decision of 26 August 2008 in case M.5121 News Corp/Premiere, recital 21.   
24  Com mission decision of 24 February 2015 in case M.7194 Liberty Global / Corelio / W&W / De 
Vijver Media , recital 98 . Commission decision of 18 July 2007 in case M.4504 SFR/Télé 2 France , 
recital 44; Commission decision of 26 August 2008  in case M.5121 News Co rp/Premiere , recital 22 . 
25  Replies to Questionnaire Q 2 to TV broadcasters of 7 May 2018, part B.  
 
12 (50) In any event, for the purpose of this decision, the exact product  market definition 
in relation of the wholesale supply of TV c hannels  can be left open, as the 
Proposed Transaction does not raise serious doubts as to  its compatibility with the 
internal market regardless of whether the market is segmented on the basis of 
channel  type or exhibition window.  
4.3.2.  Geographic market definition  
4.3.2.1.  Commission precedent s  
(51) In previous decisions, the Commission found the market for the wholesale supply 
of TV channels t o be either national in scope,26 sub-national,27 or by linguistic 
region encompassi ng more than one Member State.28 
4.3.2.2.  Notifying Party’s view  
(52) Comcast considers that the appropriate geographic market is national in scope, 
given that the majority of wholesale supply relationships are concluded at the 
national level, with some exceptions in which the retailer obtains broadcasting 
rights to multiple  countries/regions with a common language.  
4.3.2.3.  The Commission’s assessment  
(53) The results of the  market investigation  show that  the majority of agreements 
between TV broadcasters and retail TV distributors for the wholesale supply of 
TV channels are negotiated o n either a national basis , although they are also 
sometimes negotiated on a linguistic basis . Exceptionally, agreements are also 
made on a sub -national or worldwide  basis .29  
(54) In any event, for the purpose of this decision, the exact geographic market 
defini tion for wholesale supply of TV channels can be left open, as the Proposed 
Transaction does not raise serious doubts as to its compatibility with the internal 
market regardless of whether the market is considered as national, sub -national or 
by linguistic region.  
4.4. Retail provision of TV services  
4.4.1.  Product market definition  
4.4.1.1.  Commission precedent s  
(55) In previous cases the Commission has split the retail supply of television services 
in two separate markets: (i) FTA and pay -TV.30 The Commission also considered 
                                                 
26  Commission decision of 21 December 2011 in case M.6369 HBO/Ziggo/HBO Nederland, recital 39; 
Commission decision of 15 April 2013 in case M.6880 Liberty Glo bal/Virgin Media , recital 41; 
Commission decision of 10 October 2014 in case M.7000 Liberty Global/Ziggo , recital 98.   
27  Commission decision of 24 February 2015 in case M.7194 Liberty Global / Corelio / W&W / De 
Vijver Media .   
28  Commission decision of 21 December 2010 in case M.5932 News Corp/BskyB, recitals 86 –88; 
Commission decision of 15 April 2013 in case M.6880 Liberty Global/Virgin Media .   
29  Replies to Questionnaire Q 2 to TV broadcasters of 7 May 2018, question B4.  
30  See for instance the Commis sion decisions of 18 July 2007 in case M.4504 SFR/Télé 2 France , 
recital 40, and of 25 June 2008 in case M.5121 News Corp / Premiere , recital 20. In other cases this 
 
 
13 wheth er pay -TV can be segmented further according to: (ii) linear vs non -linear 
pay-TV services;31 (iii) according to distribution technologies (e.g. cable, satellite, 
or terrestrial);32 and (iv) premium vs basic pay -TV services.33 In recent cases, the 
Commission has left open the market definition with regard to each of these 
potential sub -segments.34  
4.4.1.2.  Notifying Party’s view  
(56) Sky considers that there is a single, albeit differentiated, market for the provision 
of all audiovisual services (comprising pay and FTA, bas ic and premium) to end 
users.  
4.4.1.3.  The Commission’s assessment  
(57) A number  of respondents to the market investigation doubted the relevance of the 
distinction between basic and premium pay -TV. In addition, respondents were 
divided as to whether the provision of retail services could be segmented by 
genre.35 
(58) The results of the market  investigation indicated that most distributors provide 
both linear and non -linear services. However,  they did not provide definitive 
views as to whether the broadcasting rights for linear and non -linear services are 
always acquired separately or together. A majority of distributors did not consider 
VOD services offered by OTT providers substitutable to pay -TV services.36  
(59) In any event, for the purpose of this decision, the exact product market definition 
in relation of the retail supply of TV services can be left open, as the Proposed 
Transaction does not raise serious doubts as to its compatibility with the internal 
market regardless of whether the market is further segmented or not.  
                                                                                                                                                 
question has instead been left open (see for instance the Commission decisions of 24 February 2015 
in case M.7194 Liberty Global / Corelio / W&W / De Vijver Medi a, recital 119 -120, of 25 June 2008 
in case M.5121 News Corp/ Premiere, recitals 15 and 21, and of 10 October 2014 in case M.7000 
Liberty Global/Ziggo , recital 108).   
31  Commission decision of 24 February 2015 in case M.7194 Liberty Global / Corelio / W&W / De 
Vijver Media , reictal 124. Commission decision of 25 Jun e 2008 in case M.5121 News 
Corp/Premiere, recital 21. Commission decision of 10 October 2014 in case M.7000 Liberty 
Global/Ziggo, recitals 109 –110.   
32  Commission decision of 24 February 2015 in case M.7194 Liberty Global / Corelio / W&W / De 
Vijver Media , recital 127. Commission decision of 25 June 2008 in case M.5121 News 
Corp/Premiere , recital 22; Commission decision of 21 December 2010 in case M.5932 News 
Corp/BskyB, recital 105. Commission decision of 10 October 2014 in case M.7000 Liberty 
Global/Zigg o, recital 113.   
33  Commission decision of 24 February 2015 in case M.7194 Liberty Global / Corelio / W&W / De 
Vijver Media , recital 119.   
34  Commission decision of 7 April 2017 in case M.8354 – Fox/Sky.  
35  Replies to Questionnaire Q 3 to TV distributors of 7 May 2018, part B.  
36  Replies to Questionnaire Q 3 to TV distributors of 7 May 2018, part B.  
 
14 4.4.2.  Geographic market definition  
4.4.2.1.  Commission precedent s  
(60) The Commission has previously considered that the market for the retail 
provision of TV services is either national, or limited to the geographic coverage 
of a supplier's cable network.37  
4.4.2.2.  Notifying Party’s v iew 
(61) Comcast considers that the geographic scope of the market for the retail provision 
of TV services is national, but submits that the analysis would not be materially 
different if the markets were combined into linguistic regions (or considered on a 
sub-national basis).  
4.4.2.3.  The Commission’s assessment  
(62) Nothing in the market investigation contradicts  the Commission's previous 
findings that the market is either national, or limited to the geographic coverage 
of a supplier's cable network.  
(63) In any event, t he Comm ission considers the exact geographic market definition 
for the retail provision of TV services can be left open, as the Proposed 
Transaction does not raise serious doubts as to its compatibility with the internal 
market on any geographic basis.  
4.5. Advertising  
4.5.1.  Product market definition  
4.5.1.1.  Commission precedent s 
(64) The Commission has previously defined separate product markets for the sale of 
advertising space in national newspapers and TV broadcasting.38 The 
Commission has also drawn a distinction between on line and offline advertising, 
due to each channel’s specificity and different pricing mechanisms.39 
(65) With respect to TV advertising, the Commission has not previously distinguished 
between advertising space on FTA  channels and pay -TV channels.40 
(66) With respect to online advertising , the Commission has previously distinguished 
between the market from the provision of advertising space and the market for the 
provision of online display ad technology.41 Within the market for the provision 
of advertising space, the C ommission has considered that: (i) there may be 
                                                 
37  Commission decision of 24 February 2015 in case M.7194 Liberty Global / Corelio / W&W / De 
Vijver Media .   
38  Commission decision of 21 December 2010 in case  M.5932 News Corp/BskyB , recital 267.   
39  Commission decision of 9 September 2014 in case M.7288 Viacom/Channel 5 Broadcasting , recital 
35. 
40  News Corp/BskyB , recital 267, Viacom/Channel 5 Broadcasting , recital 38.  
41  Commission decision of 11 March 200 8 in case M.4731 Google/DoubleClick , recital 56.  
 
15 different markets for search  and non-search advertising but left the market open ;42 
and (ii) intermediation is likely part of the market.43   
4.5.1.2.  Notifying Party’s view  
(67) The Notifying Party notes that advertisers ty pically use TV advertising airtime to 
reach a mass audience, while also seeking to reach particular audience 
demographics that might be delivered by advertising on particular channels or 
programmes. Moreover, in view of the increasing consumption of TV ser vices 
(particularly non -linear services) online, online advertising exercises an 
increasing competitive constraint on TV advertising. Comcast considers that the 
precise definition of the relevant market can be left open, as the Proposed 
Transaction does no t raise any competition concerns under any plausible product 
market definition.  
(68) The Notifying Party considers that  the relevant  market comprises the supply of  
online display ad serving technology , in line with previous Commission 
precedent . 
4.5.1.3.  The Commission’s assessment  
(69) Nothing in the market investigation contradicts the Commission's previous 
findings regarding the advertising markets.  
(70) In any event, t he Commission considers that the precise definition of the relevant 
market can be left open, as the  Proposed Transaction does not raise any 
competition concerns under any plausible product market definition.  
4.5.2.  Geographic market definition  
4.5.2.1.  Commission precedent s 
(71) Previous Commission decisions have taken the view that the markets for TV 
advertising are national in scope.44 
(72) As regards the geographic market definition for online display ad serving 
technology services, the Commission has previously considered the geographic 
market for these services to be at least EEA -wide in scope.45 
4.5.2.2.  Notifying Party’s view  
(73) The Notifying Party considers that there is no need to precisely delineate the 
scope of these markets as the Proposed Transaction does not raise concerns under 
any approach to geographic market definition.  It does not offer a position on the 
geographic scop e of online display ad serving technology services market.  
                                                 
42  Commission decision of 11 March 2008 in case M.4731 Google/DoubleClick , recital 73.  
43  Commission decision of 11 March 2008 in case M.4731 Google/DoubleClick , recital 81.  
44  Commission decision of 7 March  2008 in the case M.5051 - APW/GMG/EMAP ; Commission 
decision of 21 December 2010 in case M.5932 News Corp/BskyB; and Commission decision date 9 
September 2014 in case M.7288 Viacom/Channel 5 Broadcasting .   
45  Google/DoubleClick , recital 91.  
 
16 4.5.2.3.  The Commission’s assessment  
(74) Nothing in the market investigation contradicts the Commission's previous 
findings that the markets for TV advertising are national in scope and that the 
market for online display  ad serving technology services is at least EEA in scope.  
(75) Accordingly, i n line with previous decisions, the Commission takes the view that 
the markets for advertising TV space and newspaper advertising are national in 
scope.  The Commission  also considers the geographic market for online display 
ad serving technology services  to be at least EEA -wide but leaves the precise 
geographic market definition open.  
5. COMPETITIVE ASSESSMEN T – HORIZONTALLY  AFFECTED MARKETS  
(76) The Proposed Transaction results in a number of horizontal overlaps at different 
levels of the distribution chain.  
(77) Upstream, the Parties ' activities  overlap with regard to the supply of TV content. 
Comcast is active with regard to the production and suppl y of commissioned TV 
content, as  well a s licensing pre -produced film and other TV content.46 While Sky 
has some marginal activ ities with regard to licensing pre -produced and 
commissioned TV content and sports content , its presence upst ream is negligible, 
leading to n o horizontally affected markets in relation to the production or supply 
of TV content.  
(78) The Parties ' activities  also overlap with regard to the acquisition of TV content 
which: (i) Sky includes in its TV channels (which are incorporated into its retail 
TV offering and/or wholesale s to third parties) as well as for supply via its 
PPV/TVOD services; and (ii) Comcast  includes in its TV channels which are 
wholesaled to third parties. This overlap results in a number of horizontally 
affected markets in the UK, Ireland , Germany, Austria and Italy, which are 
discussed further below  in Sections 5.1, 5.2 and 5.3. 
(79) Both Parties supply TV channels on a wholesale basis to third parties in a number 
of Member States. Sky supplies  a range of channels including sports, movie and 
other channels to third parties, in particular those under the Sky brand. Comcast  
has a more limited number of TV channels, including  13th Street, Universal 
Channel, Sy fy, E!, CNBC and Movies24 . Horizontally  affected markets arise in 
the UK  and Ireland which are discussed further below  in Section s 5.4 and 5.5 
respectively .  
(80) In Germany, Austria and It aly, Sky’s has a “self -retail” business model: in 
addition to retailing TV channels on its own platform, Sky's service is available 
on the platform of cable network and IPTV providers who transmit the programs' 
signal to end customers and perform certain marketing and di stribution services 
for Sky. Sky, however, enters into direct contractual relationships with 
subscribers, controls subscriber data, deploys its own subscriber management 
system and retains the rights to determine the service packaging and pricing. Sky 
                                                 
46   NBCU also has limited licencing activities for sports content.  
 
17 is therefore not active with regard to the wholesale distribution of TV channels in 
Germany, Austria and Italy and no affected markets arise.  
(81) Sky is active as a retail supplier of TV services in the UK, Ireland, Germany, 
Austria and Italy. Comcast is also active in those Member States with the overlap 
resulting in an affected market in United Kingdom , Ireland , and Italy  which is 
discussed further below  in Section  5.6. 
(82) For the sake of completeness, the Commission notes that  Sky also expanded its 
OTT offering by launching a retail TV service in Spain on 11 September 2017 
under the Sky brand via NOW TV.47 Sky’s retail offering in Spain does not 
currently include any of Sky’s own TV channels, but rather broadcasts third party 
TV channels supplied by wholesale TV channel suppliers such as Twenty First 
Century Fox ("21CF") , Turner, NBCU and Viacom. However, no ho rizontally 
affected markets arise.  
(83) Finally, the Parties ' activities  also overlap with regard to the supply of TV 
advertising airtime on their TV channels . However no horizontally affected 
markets arise  on any plausible market definition .  
(84) In the course of the market investigation the Commission received a third party 
submission  alleging possible adverse effects on competition arising  from the 
Proposed Transaction in the market for premium video advertising technology 
services. Comcast is active in the provi sion of online display ad serving 
technology  services (FreeWheel) , while Sky provides targeted and multi -platform 
advertising service s (Sky AdSmart and Sky AdVance) .   
(85) While reserving an opinion on the precise delineation of the product market, the 
Commiss ion considers that the Proposed T ransaction does not raise serious 
doubts as to its compatibility with the internal market in relation to video 
advertising technology services.  Sky’s services are not an online ad serving 
technology,48 and Sky require s ad serving technology from third -party providers 
for its on demand adverts . The Transaction therefore does not lead to any overlap 
in this respect. In addition,  Comcast's position in the relevant market is limited 
(even on the narrowest market definition,  Comcast 's market share will amount to 
[5-10] – [10-20]%) and there are other competitors present, for example Google 
DoubleClick, Ooyala, AppNexus or SpotX .  
5.1. Acquisition of TV content - UK & Ireland  
(86) In the UK and Ireland , both NBCU and Sky a cquire distrib ution rights for T V 
content for inclusion in their TV channels and in their non -linear service 
                                                 
47  The Service comprises 16 non -exclusive, non -premium linear channels and over 3,000 hours of 
video -on-demand programming priced at EUR 10 a month with no contract. The linear channels 
available on Sky’ s OTT service include (inter alia): FOX, FOX Life, TNT, Historia, Syfy, Disney 
Junior, Nickelodeon, TCM, Comedy Central, Calle 13, Disney XD and National Geographic. On 
demand content accessible via the OTT service includes boxset TV series and movies such  as How I 
Met Your Mother, Grey’s Anatomy, and Guardians of the Galaxy. Catch -up content from the 
available linear channels is also made available to subscribers on -demand.  
48  The online ad serving technology market has been considered in Google/Doubleclic k; Ad serving 
tools ensure that the correct ad actually appears (i.e. is served) onto the publisher website space at 
the right place at the right time.  
 
18 offerings. Table 1 below shows the segments where the Parties’ overlapping 
activities result in horizontally affected markets, namely: (i) acquisition of all TV 
content, and (ii) acquisition of all film content.  There are no affected markets 
when considering a segment of all other TV content, or when considering only 
pre-produced content.  
Table 1 - Market shares for the acquisition of TV co ntent – UK & Ireland -2017  
 All TV content (%)  All film content (%)  
NBCU  [0-5] [0-5] 
Sky [40-50] [50-60] 
Combined  [40-50] [50-60] 
Source: Form CO, table 7.  
(87) Table 1 shows that when considering the market for the acquisition for all TV 
content, the Par ties combined market share is [ 40-50]%. However, the increment 
brought about by the Proposed Transaction is limited as wh ile Sky has a market 
share of [ 40-50]%, Comcast's share is less than [ 0-5]%. When considering the 
segment for the acquisition of film c ontent, the position is similar. The Parties 
have a combined market share of [ 50-60]% with an increment of just [ 0-5]%. The 
market shares do not materially change when considering the UK and Ireland 
separately although for the acquisition of film content i n Ireland, there would not 
be an overlap as Comcast [business secret regarding business strategy of 
Notifying Party ] film content in Ireland.  
(88) Whilst Sky has a material  share for the acquisition of all TV content and film 
content in the UK and Ireland, the Proposed Transaction does not materially 
change the competitive landscape in those segments  and is unlikely to 
significantly increase Sky's market power  because of the limited increment.  
(89) Moreover, in each of the UK a nd Ireland there are also a number of other players 
present in the segment for the acquisition of film content , including the BBC, ITV 
and Channel 4 , as well as OTT players such as Netflix and Amazon.  
(90)  Consequently , the Commission considers that the Propos ed Transaction does not 
raise serious doubts as to its compatibility with the internal market  with regard to 
the acquisition of TV content in the UK and Ireland , whether the Member States 
are considered together or separately .  
5.2. Acquisition of TV content – Germany & Austria  
(91) In Germany and Austria both NBCU and Sky acquire distribution rights for TV 
content for inclusion in their TV channels. Table 2 shows t he Parties’ market 
share for the segment for all film content . No affected market arises when 
considering the market for the acquisition of all film content.   
 
19 Table 2 - Market shares for the acquisition of TV content – Germany and Austria  - 
2017  
 All film content (%)  
NBCU  [0-5] 
Sky [20-30] 
Combined  [20-30] 
Source: Form CO, table 7.  
(92) Table 2 shows that the Parties combined share is [ 20-30]% (Sky: [ 20-30]%; 
Comcast: [ 0-5]%). The market shares do not materially change when considering 
Germany and Austria separately.  
(93) Given the minim al NBCU’s acquisition activities in Germany and Austria, the 
increment share arising from the Proposed Transaction would be negligible. With 
limited increment, the Proposed Transaction could not be expected to materially 
increase Sky’s market  power in this  regard.  
(94) Moreover, in each of Germany and Austria there are also a number of other 
players present in the segment for the acquisition of film content, including ARD, 
ZDF, PS71 and RTL as well as OTT players such as Netflix and Amazon.  
(95) Consequently, the Co mmission considers that the Proposed T ransaction does not 
raise serious doubts as to its compatibility with the internal market  with regard to 
the acquisition of TV content in Germany and Austria , whether the Member 
States are considered separately or toge ther. 
5.3. Acquisition of TV content – Italy  
(96) In Italy both NBCU and Sky acquire distribution rights for TV content for 
inclusion in their TV channels. Table 3  below shows the segments where the 
Parties’ overlapping activities result in horizontally affected markets, namely: (i) 
acquisition of all TV content, and (ii) acquisition of all film content.  
Table 3 - Market shares for the acquisition of TV content – Italy  - 2017  
 All TV content (%)  All film content (%)  
NBCU  [0-5] [0-5] 
Sky [20-30] [30-40] 
Combined  [20-30] [30-40] 
Source: Form CO, table 7.  
(97) Table 3 shows that when considering the market for the acquisition for all TV 
content, the Parties combined mark et share is [ 20-30]% however, the increment 
brought about by the Proposed Transaction i s limited as wh ile Sky has a market 
share of [ 20-30]%, Comcast's share is less than [ 0-5]%. When considering the 
 
20 segment for the acquisition of film content, the position is similar. The Parties 
have a combined market share of [ 30-40]% with an increment of  [0-5]%.  
(98) As in the case of other markets on which the Parties’ are both active, the 
increment brought about by the Proposed Transaction is minimal.  The Proposed 
Transaction could not be expected to materially increase Sky’s market  power in 
this regard.  
(99) Moreover, t here are also a number of other players in the Italian market  that are 
active with regard to the acquisition of TV content, including film content. With 
regard to the acquisition of film rights RAI and Mediaset occupy a similar 
position as the b iggest competit ors of the merged entity with [ 20-30]% and [ 20-
30]% market share respectively  and OTT players such as Netflix and Amazon are 
also active . 
(100)  Consequently, the Commission considers that the Proposed Transaction does not 
raise serious doubts as t o its compatibility with the internal market  with regard to 
the acquisition of TV content in Italy.  
5.4. Wholesale supply of TV channels – UK  
(101)  Both Sky and  Comcast  are active in the wholesale supply of TV channels in the 
UK. Comcast wholesales five channels to distributors : Universal Channel, SyFy, 
E! Entertainment Television, CNBC and Movies24. Sky licenses a wide range of 
channels including sports, movie and “other” TV channels.49 The Parties’ 
activities give rise to affected markets in the  overall market for t he whole sale 
supply of TV channels  and its possible segmentations of news channels, pay-TV 
channels, basic p ay-TV channels and the basic general entertainment channels  
segment . No overlap arises in respect of premium pay-TV channels category, 
since Comcast is not active in that area.  
(102)  The Parties’ market shares on the basis of revenue and audience shares in the 
affected markets (or market segments)  can be seen below in Table 4. The Parties’ 
combined market share in the pay-TV basic channel market is the same by 
revenue a nd by audience and amounts to [ 20-30]%.  
Table 4 - Market shares for the wholesale supply of basic pay -TV channels – UK 
2017 
 By revenue  (%) By audience  (%) 
NBCU  [5-10] [5-10] 
Sky (including AETN ) [20-30] [20-30] 
Combined  [30-40] [30-40] 
Source: Form CO, Table 9 and 10, response to RFI 5.  
                                                 
49  Sky’s channels include : Challenge, Pick, Sky 1, Sky 2, Sky Living, Sky Atlantic, Sky Arts, Sky 
Intro , Sky Cinema channels, Sky News, Sky Sports channels (1 -5, Box Office, F1, Mix, Sports 
News HQ).  
 
21 (103)  The Commission considers that the Proposed Transaction does not raise serious 
doubts as to its compatibility with the internal market in this market in for the 
following reasons : (i) the limited increment brought about by the Proposed 
Transaction; (ii) the  presence of multiple competing TV channel providers that 
will continue to constrain the merged entity post -transaction ; and (iii) the fact that 
generally the Parties are not close competitors.  
(104)  First,  the overall  increment brought about by the Proposed  Transaction is limited  
or does not lead to significant market shares . When looking at the segment of 
news channels, Comcast’s presence on that market is minimal, so the increment 
brought about by the transaction is negligible.  On the basic pay -TV channels 
market,  Sky has a wide range of pay-TV channels  but Comcast only wholesales 
five channels in the UK and does not license any sports channels. While Sky may 
already have a material market position, given the limited extent of NBCU’s 
offering, the Commission  does not consider that the Proposed Transaction will 
have a significant effect on the competitive landscape in the UK or materially 
increase Sky’s existing market power with regard to the wholesale supply of TV 
channels.  
(105)  Second, a large  number of TV chan nel suppliers will continue to compete with 
the merged entity post -Transaction, in particular UKTV  ([10-20]% by revenue 
and [10-20]% by audience) , Discovery  ([5-10]% by revenue, [ 5-10]% by 
audience) , Fox  ([5-10]% by revenue and [5-10]% by audience) , Viacom  ([10-
20]% by revenue, [ 10-20]% by audience) , Disney  ([5-10]% by revenue, [5-10]% 
by audience)  and Time Warner  ([0-5]% by revenue, [ 0-5]% by audience) . These 
broadcasters each supply a range of basic  pay-TV channels to third parties  and 
will continu e to place a competitive constraint on the merged entity .  
(106)  Third, the results of the market investigation indicate that Sky and Comcast 's 
channels  do not closely compete . The majority of  respondents to the market 
investigation noted the wide range of channe ls offered by the Parties and the 
limited overlapping content  of the channels , considering each of the Parties' 
portfolios to be complementary given Sky's focus on sports and premium 
channels and Comcast's more limited portfolio focussed on general enterta inment 
non-premium movie content .  
(107)  There were however  a number of respondents to the market investigation that 
indicated that certain channels offered by the Parties’ do compete closely in the 
general entertainment segment , in particular Sky 1, Sky Atlantic and Sky Living 
were identified by some respondents as close competitors to Comcast's Universal 
and SyFy channels .  
(108)  When considering the narrower general entertainment segment of basic pay -TV 
channels, the Parties ha ve a combined market share of [ 50-60]% by revenue and 
[30-40]% by audience share (Sky, including AETN : [40-50]% by revenue, and 
[20-30]% by audience; Comcast: [ 5-10]% by revenue, and [10-20]% by 
audience). By channel,  Comcast's Universal channel has a [5-10]% share by 
revenue and [5-10]% by au dience and SyFy has a share of [ 0-5]% by revenue and 
by audience.  
(109)  The Commission notes that Sky Atlantic is exclusive to Sky and not currently 
wholesaled to third  parties.  It therefore does not contribute to Sky's position on 
the wholesale market. With regard to the reported closeness between Sky One and 
 
22 Sky Living on the one hand and Universal and  SyFy  on the other , the 
Commission considers  that there are a sufficient number of other closely 
competing channels, some of which are larger than the Comcast channels, that 
will remain post -Transaction and continue to place a constraint on the merged 
entity. In particular, UKTV 's GOLD ([5-10]% by revenue and [ 5-10]% by 
audience) and Alibi  ([0-5]% by revenue an d [5-10]% audience)  channels and 
Fox's FOX  channel ([ 5-10]% by revenue  and [ 5-10]% by audience) were all also 
identified as  being close competitors to the Comcast channels.  Furthermore, 
several distributors have indicated that the entry of new channels cou ld not be 
excluded.  
(110)  The Commission therefore considers that the Proposed Transaction does not raise 
serious doubts as to its compatibility with the internal market with respect to the 
wholesale  provision of TV channels  in the UK .  
5.5. Wholesale supply of TV c hannels – Ireland  
(111)  Both Sky and Comcast are active in the wholesale supply of TV channels in 
Ireland. Comcast  wholesales five channels to downstream customers: Universal 
Channel, SyFy, E! Entertainment Television, CNBC and Movies24. Sky licenses 
a wide rang e of channels including sports, movie and “other” TV channels.50 The 
Parties’ activities give rise to affected markets in the  overall market for the  
whole sale supply of TV channels and its possible segmentations of news 
channels, pay-TV channels, and within that basic pay-TV channels and basic pay-
TV general entertainment channels. No overlap arises in respect of the premium 
pay-TV channels category, since Comcast is not active in that area.  
(112)  The Parties’ market shares on the basis of revenue and audience shares in the 
affected market are shown  below in Table 5. By revenues, the Parties have  a 
combined mar ket share of [ 10-20]% (Sky: [ 10-20]%; Comcast : [0-5]%); the 
audience based market shares are higher: [20-30]% (Sky: [10-20]%; Comcast:  [5-
10]%). An affected market only arises when considering the market on the basis 
of audience shares.  
Table 5 - Market shares for the wholesale supply of basic pay -TV channels – 
Ireland 2017  
 By revenue  By audience  
NBCU  [0-5]% [5-10]% 
Sky (including AETN)  [10-20]% [10-20]% 
Combined  [10-20]% [20-30]% 
Source: Form CO, Table 11, response to RFI 5.  
                                                 
50  Challenge, Pick, Sky 1, Sky 2, Sky Living, Real Lives, Sky Arts, Sky Cinema channels, Sky News, 
Sky Sports channels (Main Event, Premier League, Football, C ricket, Golf, Action, Arena F1, Mix, 
Sports News).  
 
23 (113)  The Commission considers that the Proposed Transaction does not raise serious 
doubts as to its compatibility with the internal market in this market for the 
following reasons : (i) the limited increment brought about by the Proposed 
Trans action; (ii) the presence of multiple competing TV channel providers that 
will continue to constrain the merged entity post -transaction ; and (ii i) the fact that 
generally the P arties are not close competitors.  
(114)  First, the  overall  increment brought about by the Proposed Transaction is limited. 
When looking at the segment of news channels, Comcast’s presence on that 
market is minimal , so the increment brought about by the transact ion is 
negligible. On the basic pay-TV channels market, the Parties'  combined market 
share ([ 20-30]%) do es not give rise to competition concerns.   
(115)  Second, a  large  number of TV channel suppliers will continue to compete with 
the merged entity post -Transaction, in particular Viacom  ([10-20]% by revenue, 
[20-30]% by audience) , Discovery  ([5-10]% by revenue, [ 10-20]% by audience) , 
UKTV  ([10-20]% by revenue, [ 5-10]% by audience) , Disney  ([5-10]% by 
revenue and by audience),  and Fox  ([5-10]% by revenue, [ 5-10]% by audience) . 
These broadcaste rs each supply a range of basic pay-TV channels to third parties  
and will continu e to place a competitive constraint on the merged entity .  
(116)  Third, as described above  in paragraph  (106)  in relation to  the UK, the results of 
the market investigation indicate  that Sky and Comcast 's channels  do not closely 
compete  in the UK and Ireland . The majority of respondents to the market  
investigation noted the wide range of channels offered by the Parties and the 
limited overlapping content  of the channels, considering each of the Parties' 
portfolios to be complementary given Sky's focus on sports and premium 
channels and Comcast's more limited portfolio focussed on general entertainment 
non-premium movie content .  
(117)  There were however  a number of respondents to the market investigation that 
indicated that certain channels offered by the Parties’ do compete closely in the 
general entertainm ent segment , in particular Sky 1, Sky Atlantic and Sky Living 
were identified by some respondents as close competitors to Comcast's Universal 
and SyFy channels .  
(118)  When considering the narrower general entertainment segment of basic pay -TV 
channels  in Irelan d, the Parties ha ve a combined market share of [ 20-30]% by 
revenue and [ 40-50]% by audience share (Sky, including AETN : [20-30]% by 
revenue, and [30-40]% by audience; Comcast: [ 0-5]% by revenue, and [10-20]% 
by audience). By channel, Comcast's Universal channel has  a [0-5]% share by 
revenue and [ 5-10]% by au dience and SyFy has a share of [ 0-5]% by revenue and 
[0-5]% by audience.  
(119)  The Commission notes that Sky Atlantic is exclusive to Sky and not currently 
wholesaled to third parties. With regard to the rep orted closeness between Sky 
One and Sky Living on the one hand and Universal and SyFy on the other , the 
Commission considers that there are a sufficient number of other closely 
competing channels, some of which are larger than the Comcast channels, that 
will remain post -Transaction and continue to place a constraint on the merged 
entity.  In particular, UKTV 's GOLD ([ 5-10]% by revenue and [ 5-10]% by 
audience) and Alibi ([ 5-10]% by revenue and [0-5]% audience) channels and 
Fox's FOX channel ( [5-10]% by reven ue and [5-10]% by audience) were all also 
 
24 identified as  being close competitors to the Comcast channels.  Furthermore, 
several distributors have indicated that the entry of new channels could not be 
excluded.  
(120)  The Commission therefore considers that the Pro posed Transaction does not raise 
serious doubts as to its compatibility with the internal market with respect to the 
wholesale  provision of TV channels in Ireland.   
5.6. Retail provision of TV services  
(121)  In the UK  and Ireland, Comcast offers one non -linear service, hayu , direct to end -
users, and licenses the CNBC linear channel to hotels and financial services firms . 
In Italy, Comcast's retail activities are limited to licensing the CNBC linear 
channel to hotels an d financial services firms . In these countries, the overlap with 
Sky's own retail TV services leads to technically affected markets given Sky's 
retail market shares.51  
(122)  However, Comcast's retail activities are de minimis . As of 5 April 2018, hayu  has 
[redac ted] direct subscribers in the UK and [redacted ] direct subscribers in 
Ireland and Comcast's share does not ex ceed [ 0-5]% of the potential sub -segment 
for the ret ail provision of non -linear pay TV services. Similarly, Comcast's 
position resulting from dire ct sales of CNBC account for a negligible share of the 
retail market for pay TV services or potential linear pay TV sub -segment.  
(123)  Accordingly, the Proposed Transaction will not lead to a material increment in the 
merged entity's market share in the retail provision of pay TV services.  
(124)  The Commission therefore considers that the Proposed Transaction does not raise 
serious doubts as to its compatibility with the internal market with respect to the 
retail provision of TV services in the UK, Ireland and Italy given the negligible 
overlap and Comcast’s minimal presence on these markets.   
6. COMPETITIVE ASSESSMEN T – VERTICALLY AFFECTED MARKETS . 
(125)  As noted above: (i) both Parties are active with regard to the supply of TV 
content; (ii) both Parties supply TV channels o n a wholesale basis to third parties  
in the UK and Ireland ; and (iii) Sky is active as a TV distributor for retail TV 
services in the UK, Ireland, Germany, Austria and Italy and Comcast is active in 
the UK, Ireland and Italy . The Proposed Transaction there fore results in a number 
of vertical relationships.  
(126)  These activities at various levels of the value chain give rise to the following 
vertically affected markets in various Member States:  
(a) Comcast’s and Sky’s upstream activities as suppliers of TV conten t and their 
respective downstream activities in the wholesale supply of TV channels ; and, 
                                                 
51  Sky's share of retail pay TV services by revenue amounts to [ 60-70]% in the UK, [ 60-70]% in 
Ireland and [ 70-80]% in Italy. These market shares will not be materially increased as a result of the 
Propose d Transaction.  
 
25 (b) Comcast’s and Sky’s upstream activities as wholesale suppliers of TV 
channels and Sky’s downstream activities as a TV retailer . 
(127)  Where there are vertically affecte d markets, two possible forms of foreclosure 
arise. The first is where the merger is likely to raise the costs of downstream 
rivals by restricting their access to an important input (input foreclosure). The 
second is where the merger is likely to foreclose  upstream rivals by restricting 
their access to a sufficient customer base (customer foreclosure).  
(128)  Section 6.1 discusses the possible input foreclosure concerns arising from the 
Proposed Transaction with regard to TV markets; Section 6.2 discusses the 
possible customer foreclosure concerns arising from the Proposed Transaction 
with regard to TV markets.  
(129)  For the sake of completeness, the Commission notes that it found no vertically 
affected markets in relation to advertising markets.  
6.1. Input foreclosure – TV markets  
6.1.1.  Introduction  
(130)  The Proposed Transaction will bring about a vertical relationship with regard to 
the licensing of broadcasting rights. Sky operates as a purchaser of broadcasting 
rights  (to assemble TV channels to be provided to TV retailers or to use in a self -
retail model ) and TV channels  (which it integrates in its TV retail offers) while 
Comcast is active at the wholesale level as a licensor of TV content (such as films 
and TV series) and provider of TV channels (such as 13th Street or SyFy).  
(131)  In a merger between companies which operate at different levels of the supply 
chain, anti -competitive effects may arise when the merged entity’s behaviour 
could limit or eliminate competitor’s access to supplies – input foreclosure.  
(132)  In assessing the likelih ood of an anticompetitive input foreclosure scenario, the 
Commission examines : (i) whether the merged entity would have post -merger the 
ability to substantially foreclose access to input; (ii) whether the merged entity 
would have the incentive to do so; an d (iii) whether a foreclosure strategy would 
have a significant detrimental impact on effective competition downstream.52 
(133)  In the course of the market investigation the Commission received a third party 
submission with regards to a possible input foreclosure  strategy in relation to 
video a d technology  services.53 The Commission does not consider that the 
Proposed  Transaction  gives rise to serious doubts with regard to its compatibility 
with the internal market as a result of input foreclosure effects in relati on to 
online display/ video ad technology services for lack of ability to foreclose access 
to input. Even on the narrowest  market  definition, Comcast 's limited market 
shares  ([5-10] – [10-20]%) do not give rise to a significant degree of market 
power . The merged entity's share in the acquisition of online display ad serving 
technology services is estimated well below 30%, such that there are not 
                                                 
52  See Guidelines on the assessment of non -horizontal mergers under the Council Regulation on the 
control of concentrations between undertakings ("Non -Horizontal Merger Guidelines"), OJ C 265, 
18.10.2008, p. 11, paragraph 32.   
53  See also p aragraph (84) in relation to horizontal concerns.  
 
26 vertically affected markets in relation to these services. Regardless, on  both the  
advertiser -side and publisher -side there exist other significant competitors, 
including Google, Ooyala, AppNexus, and SpotX. In addition, video ad serving 
technology services are not a necessary input into the supply of digital 
advertising, either for publishers or advertising sales ho uses.  
(134)  The following sections examine any possible input foreclosure with respect to the 
supply of TV content and TV channels in the UK, Ireland, Germany, Austria and 
Italy.  
6.1.2.  Supply of TV content  
6.1.2.1.  Notifying Party’s view  
(135)  The Notifying Party submits that it would not have the ability to engage in input 
foreclosure post -merger as: (i) it does not have market power in any product or 
geographic segment of the upstream market for licensing of TV content; (ii) 
multi -year contractual relationships with downstream c ustomers  would hamper 
the merged entity’s ability to restrict the supply of TV content or otherwise 
degrade the terms on which it supplies  content to third parties ; (iii) Sky already 
licenses content from NBCU on an exclusive basis.   
(136)  The Notifying Party su bmits that it would equally have no incentive to engage in 
input foreclosure given: (i) its strategy to license its content [Business Secrets 
redacted regarding sales strategy ], (ii) that using NBCU content exclusively or 
otherwise to degrade the condition s on which it provides access to NBCU content 
would result in significant lost licensing revenues that the merged entity would 
have no prospect of recovering downstream.  
(137)  Finally, it submits that in any event, such strategy would not have any impact on 
competition as there would be no change in the current position with regard to 
access to NBCU content for third parties ( [Confidential information redacted 
regarding Comcast’s current licensing arrangements ]), and the existence of 
several other providers o f film content which would continue to be accessible by 
competing channel suppliers.  
6.1.2.2.  Commission’s assessment  
(a) Ability to engage in input foreclosure  
(138)  In the UK and Ireland, the merged entity’s share in the upstream market is 
between [ 10-20]% and [20-30]% in all market segments , except for the narrower 
segment of licensing of US film content in the first pay -TV window in which 
NBCU has a [ 20-30]% market share  in 2017 . Post-transaction  the other major  
Hollywood studios  will also have  significant  market shar es licensing of US film 
content in the first pay -TV window : Disney  ([20-30]%), Fox ([ 10-20]%), Warner 
([10-20]%), Sony ( [10-20]%), Paramount ( [0-5]%) and will continue to place a 
competitive constraint on the merged entity.  
 
27 (139)  In Germany and Austria,  the merg ed entity’s market shares are below 20% in all 
vertically affected segments.54  
(140)  In Italy,  merged entity’s market shares in the upstream market are below [ 10-
20]% in the TVOD/PPV and first pay -TV window segment s and [20-30]% in the 
overall all film content category. In the US  film first pay -TV window Comcast 
held a [20-30]% market share in 2016, but its share fell to [ 10-20]% in 2017. 
Post-transaction the other major Hollywood studios will have superior to similar 
market shares : Warner ([ 30-40]%), Disney ([ 20-30]%), Fox ([10-20]%) and will 
continue to place a competitive constraint on the merged entity.  
(141)  Given the merged entity’s limited market position with regard to the  licensing of 
content, the Comm ission considers that it would not have the ability to fore close 
its downstream rivals . 
(b) Incentive to engage in input foreclosure  
(142)  Several  respondents to the market investigation consider that the merged entity 
may have the incentive to exclusively supply some of its TV content to Sky and 
not to other TV channel  suppliers/TV services retailers, or to otherwise degrade 
the terms and conditions on which it provides access.55 
(143)  On the other hand, the Commission notes that [redacted ] of Comcast ’s licensing 
revenue is accounted for acquirers other than Sky. Existing contractual 
arrangements for the provision of content could also disincentive the merged 
entity from foreclosing its input s. Furthermore, given the significant position of 
alternative content suppliers, foreclosing access to Comcast's content would not 
significantly impact the merged entity's downstream revenues.  
(144)  In any event, given the lack of ability to foreclose, it is not necessary to conclude 
as to whether t he merged entity will have the incentive to foreclose competing TV 
channel suppliers and/or TV s ervices retailers from its content in the relevant 
Member States . 
(c) Impact on effective competition  
(145)  Regardless of whether the merged entity has either the ability or the incentive to 
foreclose competing downstream rivals with regard to the supply of TV c ontent, 
the Commission does not consider that such strategy would have an impact on 
competition.  
(146)  The market shares presented above indicate that several providers of TV content 
would remain active in the market in each of the UK, Ireland, Germany, Austria 
and Italy  and so competing TV channel suppliers and providers of TV retail 
services would continue to have access to TV content that competes with the 
content supplied by Comcast today.  
  
                                                 
54  Data for 2017, response to RFI4 Table 10.1. In 2016, NBCU’s market shares in the licensing of US 
film first pa y-TV window was [ 20-30]%. 
55  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question C5; Replies to 
Questionnaire Q 3 to TV distributors of 7 May 2018, question D7.  
 
28 (d) Conclusion  
(147)  In light of the above, the Commission considers that the Proposed Transaction 
does not give rise to serious doubts with regard to its compatibility with the 
internal market as a result of input foreclosure effects to the detriment of either 
competing TV broadcasters or providers of TV retail  services in the UK, Ireland, 
Germany, Austria or Italy.  
6.1.3.  Wholesale supply of TV channels  
6.1.3.1.  Introduction  
(148)  The Proposed T ransaction increases Sky’s pre -existing vertical integration by 
adding Comcast’s channels to Sky’s existing portfolio. The Commission has 
therefore assessed the risk of input foreclosure with regard to TV channels as a 
result of the transaction. The Commis sion notes, in this regard, that Comcast 
broadcasts general entertainment channels and CNBC, a business news channel. 
CNBC is available on an FTA  basis  in the UK, Ireland and Italy. In Germany and 
Austria, CNBC's  audience share is negligible56, such that input foreclosure can be 
excluded  at the outset . The below analysis will therefore  focus on  input  
foreclosure in relation to general entertainment channels.  
6.1.3.2.  The Notifying Party's view  
(149)  The Notifying Party submits that the merged entity would lack the abilit y to 
engage in input foreclosure. It argues that the Parties’ combined share is limited 
in all Member States  where Sky is active  and considers that none of Comcast's 
channels can be  considered to constitute important inputs to downstream 
competitors.  The N otifying Party also indicates that there will remain a sufficient 
number of wholesale competitors for downstream rivals to have access to 
alternative inputs, especially in the general entertainment segment where major 
broadcasters like Fox, Time Warner, UK TV, Viacom ad Discovery will continue 
to compete after the Transaction.  
(150)  In addition, the Notifying Party indicates that the merged entity would lack the 
incentive to cease making Comcast’s channels available to downstream 
competitors. It argues that the li mited increment brought about by the Transaction 
would not suffice to modify the merged entity's incentives. The Notifying Party 
indicates that Comcast's current incentive to [Business secret redacted regarding 
Comcast’s sales policy ] will remain unchanged  by the Transaction. Moreover, it 
notes that, despite already being vertically integrated, Sky has not foreclosed its 
downstream rivals' access to its wholesale TV channels in the UK and Ireland, 
and its incentive in that regard  will not change as a result  of the Proposed 
Transaction . 
(151)  Finally, the Notifying Party considers that Comcast's channels do not just 
compete with other general entertainment channels, but also with channels 
broadcasting different thematic content. Because the merged entity's position  in 
                                                 
56  The Notifying Party has only provided market share estimates for all pay -TV channels and were 
unable to provide market share estimates limited to pay TV -only news channels, due to the limited 
size of this market in Germany and Austria. However, no respondent to the market investigation 
identified any input foreclosure risk in re lation to CNBC.  
 
29 other genres would remain unaffected by the Transaction, the Notifying Party 
argues that any hypothetical customer diversion as a result of input foreclosure 
can be expected to be very limited. As a result, according to the Notifying Party, 
the merged entity's incentives would not be changed by the Transaction and any 
putative impact on competition would be immaterial.  
6.1.3.3.  The Commission's assessment - UK and Ireland  
(a) Ability to engage in input foreclosure  
(152)  As set out above in Tables 4 and 5, with regard to the wholesale supply of basic 
pay TV channels:  
(a) in the UK, the Parties have a combined market share of [30-40]% by 
revenue (Sky: [20-30]%; Comcast : [5-10]%) and [30-40]% by audience 
share (Sky: [20-30]%; Comcast: [5-10]%); 
(b) in Ireland, the Parties have a com bined market share of [10-20]% by 
revenue (Sky: [10-20]%; Comcast : [0-5]%) and [20-30]% by audience 
share (Sky: [10-20]%; Comcast: [5-10]%). 
(153)  As Comcast  does not wholesale any premium pay -TV channels there is no 
overlap in this regard.   
(154)  In respect of the me rged entity's ability to engage in input foreclosure, 
respondents to the market investigation consider that Sky holds a leading market 
position and " must have " channels. As concerns the Notifying Party , although a 
number of respondents consider that Comcas t does have bargaining power, there 
is no indication that there would remain insufficient substitutes to its channels in 
the market after the Transaction.  
(155)  When considering a potential sub -segment for general entertainment pay -TV 
channels, the Parties market shares are higher, as indicated in Tables 4 and 5 
above. However, close competitors with audience shares higher or similar to 
Comcast's channels would remain active in the market  in both the UK and Ireland  
(UKTV , with  [20-30]% in the UK and [ 10-20]% in Ireland , Fox with [ 10-20]% in 
the UK and [ 5-10]% in Ireland).  
(156)  The availability of alternatives is further  supported by the market investigation 
which showed that several TV channels , which will remain available post -
transaction,  are close competitors to Comcast's main channels, Universal Channel 
and SyFy. Close competitors to Universal Channel and SyFy include Fox (21CF), 
W and Alibi (both UKTV). This result confirms the Parties' own assessment of 
closeness of competition and singles out ch annels whose audience is either higher 
or on par with Comcast's.  
(157)  Based on  the above, the Commission considers that the merged entity is unlikely 
to have  the ability to foreclose competing TV distributors in the UK and Ireland  
post-transaction .  
 
30 (b) Incentive  to engage in input foreclosure  
(158)  Several  respondents to the market investigation consider that post -transaction the 
merged entity would have the incentive to exclusively supply its channels to Sky 
and not to other provider s of TV retail services, or to degr ade the terms and 
conditions to which it provides access.57  
(159)  However , Sky is already vertically integrated with regard to the upstream supply 
of TV channels and the downstream supply of retail TV services; the increment 
brought about by the Transaction is t herefore limited to Comcast's channels. As 
noted above, Comcast's market share in the wholesale supply of TV channels is 
limited and the merged entity's incentives will therefore not be significantly 
changed as a result of the Transaction.  
(160)  Moreover , despit e being vertically integrated, Sk y currently licenses basic general 
entertainment channels to competing distributors. There is no evidence on file to 
suggest that the change brought about by the Transaction would modify  its overall 
incentive in this respec t. 
(161)  In any event, given the lack of ability to foreclose, it is not necessary to conclude 
as to whether the merged entity will have the incentive to foreclose competing TV 
distributors in the UK and Ireland post -transaction.  
(c) Impact on effective competition  
(162)  Regardless of whether the merged entity has either the ability or the incentive to 
foreclose competing downstream rivals with regard to the wholesale supply of 
basic pay -TV channels, the Commission does not consider that such a strategy 
would have an impac t on competition.  
(163)  As detailed above in paragraph  (156)  there are several  providers of  basic pay -TV 
channels  that closely compete with Comcast's channels and will remain active 
post-transaction. Therefore even if the merged entity were to adopt a foreclosure 
strategy, downstream rivals would continue to have access to sufficient 
alternative inputs.  
(d) Conclusion  
(164)  In light of the above, the Commission considers that  the Proposed Transaction 
does not give rise to serious doubts with regard to its compatibility with the 
internal market as a result of input foreclosure effects of TV channels to the 
detriment of competing retail providers of TV retail services in the UK or Ireland.  
6.1.3.4.  Germany and Austria  
(a) Ability to engage in input foreclosure  
(165)  As noted above in paragraph  (80), Sky does not supply channels on a wholesale 
basis to retai l TV  distributors  in Germany and Austria as it has adopted a self -
retail model. Therefore, Sky’s channels do not generate wholesale carriage 
                                                 
57  Replies to Questionnaire Q3 to TV distributors of 7 May 2018 , questions C8 and C9. 
 
31 revenues and revenue -based market share estimates are unavailable. The present 
assessment will thus rely on  audience shares. However, due to Sky’s lack of 
wholesale activity , the audience of Sky’s channels has been excluded from 
wholesale market share calculations. Finally, the Notifying Party has been unable 
to provide market share estimates for Austria alone,  but considers that its position 
in that country is not materially different than its position in Germany, such that 
market share data provided for Germany provide an adequate proxy for its market 
share in Austria. On this basis, Comcast holds a [ 10-20]% audience share in  basic 
pay-TV channels, and [ 20-30]% of the general entertainment segment in 
Germany and Austria.  
(166)  Several respondents to the market investigation indicate that Comcast’s channels 
are important input s to compete. This is particularly true wi th respect to 13th 
Street, the channel generating the most audience out of  Comcast’s portfolio, with 
an [ 10-20]% audience share among all basic pay -TV channels.  Several 
respondents thus claim that Comcast's channels constitute important inputs and 
indicate  that their thematic content (general entertainment) is among the most 
popular in basic pay TV.  
(167)  According to respondents to the market investigation, 13th Street and SyFy, which 
make up the bulk of Comcast's market share, compete most closely with Fo x 
(21C F), RTL Crime (RTL), TNT S erie and TNT Film (both Time Warner ). This 
assessment is consistent with the Notifying Party's views. According to the 
Notifying Party's analysis in terms of content and on the basis of customer 
surveys, in both Germany and Austri a [channel names ] are 13th Street closest 
competing channels and [channel names ] are SyFy's closest competitors.  
(168)  On the wholesale basic pay TV market, Fox Serie 's audience share amounts to [ 5-
10]%, TNT Serie [ 0-5]% and RTL Crime [ 5-10]%. Taken individually, t hese 
channels  have lower audience shares than 13th Street  ([10-20]%) but have higher 
to equivalent audience shares as SyFy  ([5-10]%). However, t he combined 
audience share of Fox Serie, TNT Serie and RTL Crime ( [10-20]%) is slightly 
higher th an the combined audience share of 13th Street and SyFy ( [10-20]%). 
Other TV channels providing access to general entertainment content and TV 
series include : TNT Film, Romance TV and RTL Crime.  
(169)  In order to assess whether 13th Street and SyFy  should be cons idered as 
particularly important for TV distributors, more than their audience share could 
suggest, the Commission requested the Parties to provide viewer shares based on 
different parameters.58 Table 8 summarizes such information in relation to the 
total viewing, continuous viewing and prime time viewing of Comcast's channels 
and their closest competitors in Germany and Austria . 
                                                 
58  In line with M.7194 - Liberty Global/Corelio/W&W/De Vijver Media , the Commission requested 
viewership data based on (i) total viewing time per month, (ii) continuous viewing time per month 
and (iii) prime time viewing time per month. For each (i), (ii) and (iii), the Parties submitted data for 
(a) 6 minutes, (b) 30 minutes, (c) 60 minutes, (d) 180 minutes. Table 8 presents a summary of the 
data provided . 
 
32 Table 8 - Viewership data of basic pay -TV general entertainment channels in 
Germany  
Channel  total 
time 
30 
min N. total 
time 
180 
min N. continuo
us time 
30 min  N. Viewers 
continuo
us time 
180 min  N. pri
me 
time 
30 
min N. prime 
time 
180 
min N. 
TLC  […] […] […] […] […] […] […] […] […] […] […] […] 
13th Street  […] […] […] […] […] […] […] […] […] […] […] […] 
Fox Serie  […] […] […] […] […] […] […] […] […] […] […] […] 
RTL 
Crime  […] […] […] […] […] […] […] […] […] […] […] […] 
SyFy  […] […] […] […] […] […] […] […] […] […] […] […] 
TNT Serie  […] […] […] […] […] […] […] […] […] […] […] […] 
Source: Notifying Party  using third parties reports  
(170)  Although Table 8 above  only lists Comcast's channels and the closest competing 
channels, the ranking provided is out of all basic general entertainment  channels, 
including Sky -branded channels that are so lely self -distributed on Sky's platform. 
As indicated, within its competitor group, 13th Street systematically ranks 
[redacted ], when considering several viewership data: (i) total time viewed within 
a month, (ii) continuous time viewed within a month, and  (iii) prime time viewed 
within a month. For each of these three measures, the Notifying Party provided 
data that rank the channels in terms of viewers who watched the channel for 6 
min or longer, 30 min or longer, 60 min or longer and 180 or longer within  a 
month.  SyFy has a significantly lower ranking.  
(171)  Among  general entertainment channels, the [redacted ] TLC, a channel 
broadcasted by Discovery. TLC's content, which mainly consists of reality shows, 
differs from Comcast's channels. TLC is therefore not a c lose competitor to 
Comcast, as confirmed by both the Notifying Party and the results of the market 
investigation.   
(172)  Among 13th Street 's close  competitors  within general entertainment , Fox Serie is 
systematically  the [ redacted ] viewed channel, all categories of viewership 
included. The performance and ranking of RTL Crime and TNT Serie varies  
depending of the viewership category . However, these channels' ranking in 
relation to  both 13th Street and  SyFy's confirms  that there curr ently exists a close 
competing relationship between these channels.  
(173)  In addition, the Notifying Party has provided data indicating  that the [redacted ] 
content on its channels (representing [redacted ] of 13th Street and SyFy's total 
viewing) are not exclusi ve to Comcast and are also available to viewers on other 
TV channels. Therefore , Comcast's channels do not constitute crucial inputs to 
competing distributors.  
(174)  The Notifying Party has provided data according to which the top [redacted ] TV 
series broadcast ed on 13th Street and SyFy, which represent [redacted ] of these 
channels' viewing, is not exclusive against FTA channels. Furthermore, Comcast's 
channels [Confidential information redacted relating to content licensing rights ].  
 
33 (175)  Based on the above, despite their strong position in basic pay TV, the audience 
and viewership of Comcast's channels is at least matched by the combined 
audience and viewership of the three closest competitors. Given that these 
competitors will remain avai lable post -Transaction, the Commission considers 
that the merged entity  would not have the ability to foreclose its downstream 
rivals .  
(b) Incentive to engage in input foreclosure  
(176)  The Notifying Party argues that it would lack the  incentive to foreclose access  to 
its channels in Germany and Austria as this would adversely impact the revenues 
generated from Comcast's carriage agreements. In this regard, the Notifying Party 
notes that Sky accounts for only [redacted ]% of its carriage revenues in Germany 
and Austr ia and argues that input foreclosure would not result in material 
diversion from rivals to Sky at the downstream level . The Notifying Party 
concludes  that additional retail revenues would not outweigh wholesale losses  and 
that input  foreclosure would there fore be unprofitable . 
(177)  The Notifying Party provides no relevant data to support its arguments. In the 
absence of diversion and margin evidence and g iven the disproportionate 
importance of Sky's downstream revenues in relation to Comcast's carriage 
revenues,  it cannot be assumed that reserving Comcast's channels to Sky's 
platform would be unprofitable for the merged entity.  
(178)  In addition, although, as indicated above in paragraphs (165)  to (175)  the merged 
entity will lack the ability to foreclose downstream rivals given that significant 
competitors will remain active at the wholesale level, Comcast's market shares 
both in relation to all basic pay TV and in general entertainment are material. It  
therefore cannot be excluded that the Transaction will have an impact on the 
merged entity's incentives.  
(179)  The Noti fying Party also emphasize s that, as the Commission observed in its 
decision in case M.8354 – Fox/Sky , Sky Deutschland was previously controlled 
by 21CF which did not refuse to supply its TV channels to third parties despite 
being vertically integrated. The Notifying Party thus considers that, under the 
Commission's Non-Horizontal Merger Guidelines, 21CF' s prior strategy 
constitute evidence that  the merged entity's incentives would be no different.  
(180)  However, as explained in recital 45  (footnote 7 ) of the Commission's Non -
Horizontal Merger Guidelines, past strategies adopted by competitors in relation 
to inp ut foreclosure may be taken into account for the purpose of the competitive  
assessment in situations where these competitors held " a similar market position ". 
This is not the case in the present instance as the Notifying Party's market share is  
twice  as impor tant as 21CF's market share . 
(181)  In any event, given the lack of ability to foreclose, it is not necessary to conclude 
as to whether the merged entity will have the incentive to foreclose competing TV 
distributors in the Germany and Austria .  
(c) Impact on eff ective competition  
(182)  Regardless of whether the merged entity has either the ability or the incentive to 
foreclose competing downstream rivals with regard to the supply of TV channels, 
 
34 the Commission does not consider that such a strategy would have an impact  on 
competition.  
(183)  As detailed above in paragraphs (165)  to (175) , the nu mber of competing 
channels that will continue to be available to downstream competitors post -
Transaction is sufficient to enable them to compete. The combined audience and 
viewership of channels that compete most directly with Comcast's main channels, 
13th Street and SyFy, equate or exceed Comcast's audience and viewership.  
(184)  Given the continued availability of channels that compete closely with Comcast's 
and represent significant viewership within the narrow segment of basic general 
entertainment pay TV chan nels, even in the event of input foreclosure, it is 
unlikely that downstream rivals would be significantly impacted and unable to 
compete effectively post -merger.  
(d) Conclusion  
(185)  In light of the above, the Commission considers that the Proposed Transaction 
does not give rise to serious doubts with regard to its compatibility with the 
internal market as a result of input foreclosure effects of TV channels to the 
detriment of competing retail providers of TV retail services in Germany or 
Austria . 
6.1.3.5.  Italy 
(186)  In respect of the merged entity's ability to engage in input foreclosure, as 
explained above in paragraph  (80), Sky does not supply channels on a wholesale 
basis to retail TV  distributors  in Italy whereas Comcast supplies Studio Universal 
and CNBC. With respect to Studio Universal, the Notifying Party estimates that it 
has a negligible market share in Italy, both out of all basic pay TV channels and 
within the general entertainment segment.  
(187)  As a result of Comcast's negligible market share, the Transaction will bring no 
material change to the merged entity's incentives. In any event, for the same 
reason, were the merged entity  to distribute Studio Universal exclu sively on Sky's 
platform, this would have no appreciable impact on competition.  
(188)  In light of the above, the Commission considers that the Transaction does not give 
rise to serious doubts with regard to its compatibility with the internal market as a 
result of input foreclosure effects of TV channels to the detriment of competing 
retail providers of TV retail services in Italy.  
6.2. Customer foreclosure – TV markets  
6.2.1.  Introduction  
(189)  The Proposed Transaction combines Comcast’s and Sky’s content  with their 
respective do wnstream activities as acquirer s of content for their TV channels and 
Sky’s downstream activities as a pay -TV retailer.  
(190)  According to the Non -Horizontal Merger Guidelines a downstream firm being 
part of a vertical merger may refuse to buy inputs from its rivals input suppliers as 
a result of the Proposed Transaction. This incentive to foreclose access to 
 
35 customers downstream  may result from the vertical integration of an upstream 
supplier with an important customer downstream. Due to their downstream 
presence, the merged entity may foreclose its upstream rivals ' access to a n 
important customer base. In turn this can inhibit u pstream rivals to effectively 
compete.59 
(191)  In television markets, different forms of customer foreclosure may occur. First: (i) 
intermediate TV channel wholesalers; or (ii) downstream TV distributors; cease 
purchasing TV content from upstream rivals. Second, downstream TV 
distributors cease buying TV channels from their rivals at the intermediate level 
for the wholesale supply of TV channels.  
6.2.2.  Supply of TV content  
6.2.2.1.  Introduction  
(192)  The following section assesses whether post -transaction, the merged entity would 
have the ability and incentive to cease acquiring TV content from its upstream 
rivals either: (i) for incorporation into TV channels to be wholesaled to third 
parties; or (ii)  to be sold by the merged entity directly to end users. It then 
assesses what the overall likely effect on competition would be.  
6.2.2.2.  Notifying Party's views  
(193)  The Notifying Party argues that post -Transaction, it would not have the ability  to 
foreclose its upstre am rivals  for the fo llowing reasons: (i) there are multiple other 
downstream outlets to which upstream rivals could licence their content, 
including TV channels and OTT platforms such as Netflix and Amazon; (ii) Sky's 
multi -year output and other licencing agreements with suppliers would prevent 
the merged entity from ceasing to acquire content from its upstream rivals . 
Specifically as regards the downstream markets for the acquisition of sports 
content, the Notifying Party argues that there can be no prospe ct of customer 
foreclosure : although Sky is a significant  acquirer of sports content in each of the 
vertically affected markets,  it would not be possible for Sky to pursue a strategy 
of exclusively sourcing  its sports content from NBCU, given NBCU’s activi ty as 
a licensor in the EEA  is negligible and only includes [Business secret redacted 
relating to scope of Comcast’s sports content licensing activities ]. 
(194)  The Notifying Party further submits that the merged entity would not have the 
incentive to stop acqui ring content from other suppliers of TV content as its 
commercial success is based on the richness of the bundle of content and channels 
broadcast through its platform . In addition, while Sky could be considered as an 
important acquirer of film content, Comcast acquires very limited amounts of 
content.  
(195)  It submits that such a customer foreclosure strategy would have a limited impact 
on competition given: (i) the existence of multi -year output agreements ; (ii) the 
existence of a sufficient number of credible  alternative content acquirers which 
will remain post -merger; and (iii) the fact that the  impact of the hypothetical loss 
                                                 
59  Non-Horizontal Merger Guidelines, paragraph 58.  
 
36 of revenues from Sky and NBCU’s  European operations would no t be sufficiently 
severe so as to render rival suppliers of content ineffective as competitors.  
6.2.2.3.  The Commission’s assessment - UK and Ireland  
(196)  As noted above in paragraph (43), the Commission has left open whether the 
relevant market for the supply and acquisition of TV content should be considered 
as national or on the basis o f linguistic region.  
(197)  Regardless  of this question , the Commission considers that the conclus ion of the 
competitive analysis does not differ depending on whether the UK and Ireland are 
considered separately or together.  
(a) Ability  to engage in customer foreclosure  
(198)  When considering whether the merged entity would have the ability to foreclose 
access t o downstream markets, the Commission examines whether there are 
sufficient economic alternatives in the downstream market for upstream rivals to 
sell their output.  
(199)  In the first instance, the market shares indicate that Sky is an important purchaser 
of TV content, in particular for sports and films, as shown in Table 9 below.  
Table 9 - Market shares for acquisition of TV content in share - by total spend - UK 
and Irel and - 2017  
 All TV content 
(%) All sports 
(%)60 All film (%)  Other TV 
content 
(%)61 
NBCU  [0-5] [0-5] [0-5] [0-5] 
Sky [40-50] [50-60] [50-60] [10-20] 
Combined  [40-50] [50-60] [50-60] [10-20] 
Source: Annex 7.4, Form CO.  
(200)  Sky's market share for the acquisition of films further increases when segmented 
according to release wi ndow: (i) first pay -TV window: [ 70-80]%; and (ii) 
TVOD/PPV rights: [70-80]%. In addition, Sky has a [70-80]% market share for 
US films  and [ 90-100]% for US films in the first pay -TV window . The other 
purchasers of film rights in the UK and Ireland overall are BBC: [5-10]%; ITV: 
[10-20]%; Channel 4: [ 10-20]%. With regard to the first pay -TV window, the 
OTT players are the other purchasers (Netflix: [5-10]%; Amazon: [ 10-20]%). 
(201)  Despite the importance of Sky as a purchaser of TV content , the Commission 
considers  that it would have a limited  ability to foreclose rivals by ceasing to 
                                                 
60  In the sub -segment of acquisition of all other sports content in the UK and Ireland, Sky has a market 
share of [ 30-40]%.  
61  This concerns all licenced other TV content. The Parties' market shares for the segment of licenced 
pre-produced other TV content are not materially different.   
 
37 purchase from them and exclusively relying on the content of NBCU  post-
transaction , for the followin g reasons.  
(202)  First, NBCU  has an extremely limited market position in the UK and Ireland with 
regard to the supply of sports rights ( less than [ 0-5]% share by revenue in 2017  
and the Parties together do not have more than [0-5]% under any other sub -
segment co nsidered). It is therefore not possible for Sky to exclusively rely on the 
sports rights licenced by NBCU  in the UK and Ireland.   
(203)  Second , the results of the market investigation indicate that a majority of rights 
holders consider that there are other playe rs to which they could licence their 
content as an alternative to the merged entity in the event that the merged entity 
ceased acquiring their TV content or otherwise  degraded the terms on which it 
acquires their TV content.62 Therefore, the merged entity would have no ability to 
restrict the access of rival upstream licensors to downstream purchasers of those 
rights given the multiple other outlets available to TV content licensors. A broad 
range of other TV broadcasters and content platform operators comp ete to acquire 
TV content, each of which will continue to be credible purchasers of TV content 
post-Transaction , thus allowing rival upstream licensors to continue to operate 
efficiently .  
(204)  Third , Sky has multi -year output agreements and other licensing agr eements in 
place with a wide range of rights holders . Accordingly, Sky cannot unilaterally 
cease to licence such content from these third parties or otherwise degrade the 
terms of supply until their expiry  without being in breach of these agreements.  
(b) Incen tive to engage in customer foreclosure  
(205)  The Commission does not consider that the merged entity would have the 
incentive to foreclose access to downstream markets by reducing purchases from 
upstream competing rivals for the following reasons.  
(206)  The attractive ness of a pay -TV operator's offer to consumers is based on the 
richness of the bundle of content and channels broadcast through its platform.63 
On this basis, the merged entity would not have the incentive to cease purchasing 
content from upstream competito rs. Sky does not limit its offering to NBCU film 
content, including its entire output of new films  but it purchases similar premium 
film content also from NBCU's competitors.  
(207)  A majority of the respondents to the market investigation stated either that they  
considered that the merged entity would not have the incentive to stop sourcing 
TV content from other producers/licensors and exclusively rely on content 
provided by NBCU  or stated that they considered it unlikely that the merged 
                                                 
62  Replies to Questionnaire Q1 to TV rights holders of 7 May 2018, question C.9. As to the comment 
made during the market investigation tha t there may not be actual demand from such alternatives in 
the first pay -TV window for movies, as claimed by a respondent to the market investigation, the 
Commission notes that when considering the ability to foreclose upstream rivals, the Commission 
may a lso take into account potential demand (see Non-Horizontal Merger Guidelines, paragraph 
61). 
63  See for example: Commission decision of 21 December 2010 in case M.5932 – NewsCorp/BskyB , 
paragraph 154; Commission decision  of 16 September 2014 in case M.7282  Liberty 
Global/Discovery/All3Media , paragraph 68.  
 
38 entity would ceas e licens ing content from third parties all together .64 Among the 
latter category of respondents, a major content supplier  noted that " consumers 
generally prefer a broad selection of content, so [we consider ] that a broadcaster 
is likely to maintain such a broad sel ection (including content of third parties) ".  
(208)  In this regard, the Commission  notes that over the past three years, Sky has had 
output agreements with [business secret re. sources of supply redacted ] major US 
film studios for the UK and Ireland. Therefore,  any strategy by the merged entity 
that reduced the number of licensor relationships would likely be detrimental to 
Sky’s downstream TV channel and TV retail business.  
(209)  A number of respondents to the market investigation noted that post -transaction, 
the mer ged entity may have an incentive to favour its own content above others 
but have not provided substantiated submissions explaining how the merged 
entity would implement such a potential partial foreclosure strategy.  
(210)  As noted above, the Commission considers  that the merged entity will continue to 
have a strong incentive to carry a broad range of the most attractive content on its 
platform therefore, as with the incentive to fully foreclose,  the merged entity 
would  not have the incentive to partially foreclo se its upstream rivals.  
(c) Impact on competition  
(211)  Given that there are multiple alternatives to the merged entity to which rights 
holders can supply their content, a large number of rights holders are protected 
from a foreclosure strategy : a broad range of ot her TV broadcasters and content 
platform operators compete to acquire TV content, each of which will continue to 
be credible purchasers of TV content post -Transaction  thus allowing rival 
upstream licensors to continue to operate efficiently . Moreover, due to the 
existing output agreements with Sky , Sky cannot unilaterally cease to licence 
content from these third parties or otherwise degrade the terms of supply. In light 
of this, the Commission does not consider that a potential customer foreclosure 
strateg y for content would have a material effect on competition in the UK or 
Ireland.  
(d) Conclusion  
(212)  In light of the above, the Commission concludes that the Proposed Transaction 
does not give rise to serious doubts with regard to its compatibility with the 
internal  market as a result of customer foreclosure for the supply of TV content in 
the United Kingdom or Ireland (or in relation to a linguistic region encompassing 
both the United Kingdom and Ireland).  
6.2.2.4.  The Commission’s assessment - Germany and Austria  
(213)  As noted above in paragraph (43), the Commission has left open whether the 
relevant market for the supply and acquisition of TV content should be considered 
as nati onal or on the basis on linguistic region.  
                                                 
64  Replies to Questionnaire Q1 to TV rights holders of 7 May 2018, question C.6.4 . 
 
39 (214)  Regardless, the Commission considers that conclusion of the competitive analysis 
does not differ depending on whether Germany and Austria are considered 
separately or together.  
(a) Ability  to engage in customer forec losure  
(215)  In the first instance, the market shares indicate that Sky is an important purchaser 
of sports and film TV content in Germany and Austria, as shown in Table 10 
below where Sky has a pre -transaction market share of [30-40]% for sports rights  
and a sh are of [ 20-30]% for films . 
Table 10 - Market shares for acquisition of TV content – by total spend – Germany 
and Austria - 2017  
 All sports (%)  All film (%)  
NBCU  [0-5] [0-5] 
Sky [30-40] [20-30] 
Combined  [30-40] [20-30] 
Source: Annex 7.4, Form CO.  
(216)  Sky's market share for the acquisition of films materially increases when 
segmented according to release window, in particular the first pay -TV window 
where Sky has a market share of [60-70]% by revenue.  Sky's market share is 
slightly lower than that in the  sub-segment of US film s in the first pay -TV 
window ([ 60-70]%).  
(217)  Despite the importance of Sk y as a purchaser of TV content for sports  and films, 
the Commission concludes that it would have a limited ab ility to foreclose rivals 
by ceasing to purchase from them and exclusively relying on the content of 
NBCU for the following reasons.  
(218)  The arguments articulated in relation to the UK and Ireland are also applicable in 
this market.  
(219)  First, with regard to sports rights, NBCU has an extremely limited market 
position in Germany and Austria ([0-5]%) and the Parties have a combined share 
for the licencing of sports of [0-5]%. It is therefore not possible for Sky to 
exclusively rely on the sports rights licenced by NBCU in Germany and Austria.  
(220)  Second, as noted above in with regard to the UK and Ireland, a broad range of 
other TV broadcasters and content platform operators compete to acquire TV 
content, each of which will continue to be credi ble purchasers of TV content post -
Transaction, thus allowing rival upstream licensors to continue to operate 
efficiently.  
(221)  Third, Sky currently has multi -year output agreements with a wide range of rights 
holders which prevent Sky from ceasing to purchase their content and the 
multitude of agreements with the other US studios renders content foreclosure 
strategy risky.  
 
40 (b) Incentive to engage in customer foreclosure  
(222)  As noted with regard to the UK and Ireland in paragraphs (205)  to (210)  above, 
the Commission does not consider that the merged entity would have the 
incentive to either fully or partially cease licencing content from third parties in 
relation to the markets in G ermany and Austria as it would reduce the quality of 
the Sky offering thereby risking the loss of customers.65 
(c) Impact on competition  
(223)  Given that there are multiple alternatives to the merged entity to which rights 
holders can supply their content, a large nu mber of rights holders are protected 
from a foreclosure strategy : a broad range of other TV broadcasters and content 
platform operators compete to acquire TV content, each of which will continue to 
be credible purchasers of TV content post -Transaction  thus allowing rival 
upstream licensors to continue to operate efficiently . Moreover, due to its existing 
output agreements , Sky cannot unilaterally cease to licence content from these 
third parties or otherwise degrade the terms of supply. In light of this, th e 
Commission does not consider that a potential customer foreclosure strategy for 
content would have a material effect on competition in the Germany or Austria.  
(d) Conclusion  
(224)  In light of the above, the Commission concludes that the Proposed Transaction 
does n ot give rise to serious doubts with regard to its compatibility with the 
internal market as a result of customer foreclosure for the supply of TV content in 
Germany or Austria (or on in linguistic region encompassing both Germany and 
Austria).  
6.2.2.5.  The Commissi on’s assessment - Italy 
(a) Ability  to engage in customer foreclosure  
(225)  In the first instance, the market shares indicate that Sky is an important pu rchaser 
of TV content in Italy  as shown in Table 11 below.66 
                                                 
65  With respect to the agreements with major US films studios for Germany and Austria, the 
Commission notes that Sky has h ad output agreements with [business secret re. sources of supply 
redacted ] major US film studios over the past three years.  
66  Vertically affected markets arise in Italy as regards the licensing/acquisition of all sports content 
and the licensing/acquisit ion of other sports content, due to NBCU’s presence as a licensor of other 
sports content in Italy ([ Business secret redacted relating to scope of Comcast’s sports content 
licensing activities in Italy ]). However, given the [ Business secret redacted relati ng to scope of 
Comcast’s sports content licensing activities in Italy ], customer foreclosure is not likely in these 
segments. Therefore these market segments are not further discussed in the present Section.  
 
41 Table 11 - Market shares for acquisition of TV content – by total spend – Italy - 
2017  
 All TV content (%)  All film (%)  
NBCU  [0-5] [0-5] 
Sky [20-30] [30-40] 
Combined  [20-30] [30-40] 
Source: Annex 7.4, Form CO  
(226)  Sky's market share for the acquisition of films materially increases when 
segmented according to release window, in particular the first pay -TV window 
where Sky has a market share of [60-70]%. Mediaset is the other purchaser of 
first pay -TV rights in Italy  with a share of [40-50]%. 
(227)  With regard to TVOD/PPV rights, Sky is an important player ( [40-50]%) with a 
number of other players purchasing a more limited amount of movies rights for 
this distribution platform (iTunes: [10-20]%; TimVision: [5-10]%). 
(228)  Despite the importance of Sky as a purchaser of film content, the Commission 
concludes that it would have a limited the ability to foreclose rivals by ceasing to 
purchase from them and exclusively relying on the content of NBCU . 
(229)  The arguments articulated i n relation to the UK and Ireland are also applicable in 
this market. There are many other potential purchasers of content that compete 
with NBCU's  content. Moreover, Sky currently has multi -year output agreements 
with a wide range of rights holders which p revent Sky from ceasing to purchase 
their content and the multitude of agreements with the other US studios renders 
content foreclosure strategy risky.  
(b) Incentive to engage in customer foreclosure  
(230)  As noted above with regard to the UK and Ireland in paragra phs (205)  to (210) , 
the Commission does not consider that the merged entity would have the 
incentive to either fully or partially cease licencing content from third parties as it 
would reduce the quality of the  Sky offering thereby risking the loss of 
customers.67 
(231)  In particular, as noted above in with regard to the UK , Ireland, Germany and 
Austria, a broad range of other TV broadcasters and content platform operators 
compete to acquire TV content in Italy, each o f which will continue to be credible 
purchasers of TV content post -Transaction, thus allowing rival upstream licensors 
to continue to operate efficiently.  
                                                 
67  With respect to the agreements with major US films studios Italy, the Commission notes that Sky 
has had output agreements with [business secret re. sources of supply redacted ] major US film 
studios over the past three years.  
 
42 (c) Impact on competition  
(232)  Given that there are multiple alternatives to the merged entity to which right s 
holders can supply their content, a large number of rights holders are protected 
from a foreclosure strategy : a broad range of other TV broadcasters and content 
platform operators compete to acquire TV content, each of which will continue to 
be credible purchasers of TV content post -Transaction  thus allowing rival 
upstream licensors to continue to operate efficiently .  
(233)  Moreover, due to the existing output agreements with Sky, Sky cannot 
unilaterally cease to licence content from these third parties or otherwise degrade 
the terms of supply. In light of this, the Commission does not consider that a 
potential customer foreclosure strategy for content would have a material effect 
on competition in Italy.  
(d) Conclusion  
(234)  In light of the above, the Commission conc ludes that the Proposed Transaction 
does not give rise to serious doubts with regard to its compatibility with the 
internal market as a result of customer foreclosure for the supply of TV content in 
Italy.  
6.2.3.  Wholesale supply of TV channels  
6.2.3.1.  Introduction  
(235)  At the wholesale level, Sky is already vertically integrated in that it already owns 
a portfolio of channels in addition to being present downstream as a distribution 
platform. T he merger specific aspect in this regard is the addition of Comcast 's 
TV chann els. 
(236)  The Commission has therefore assessed the risk of the following types of 
customer foreclosure strategies in the United Kingdom, Ireland, Austria, Germany 
and Italy: (i)  complete foreclosure of rival TV broadcaster s through the denial of 
access to Sky's downstream distribut ion platform; and (ii) partial customer 
foreclosure of rival TV broadcasters through for instance a  degrad ation of  the 
quality of the viewer experience for competing channel s on Sky's  platform or 
through a reduc tion in  carriage fees . 
(237)  Pay TV providers have to offer a diverse portfolio of channels in order to 
maximise their attractiveness for a large number of viewers. The risk of broad 
foreclosure strategy not targeting closely competing channels with Comcast's 
channels, but foreclosing  also channels that are not close competitors to 
Comcast's channels can therefore be excluded at the outset . In the following 
Section 6.2.3.2 , the Commission identifies those closely competing channels 
which could potentially be the target of customer foreclosure.   
6.2.3.2.  Potential  targets of customer foreclosure  
(238)  Comcast broadcasts gener al entertainment channels and CNBC, a business news 
channel. CNBC is available free -to-air (“FTA”) in the UK, Ireland and Italy. In 
Germany and Austria, its audience share is negligible  such that customer 
 
43 foreclosure can be excluded. The below analysis wil l thus focus on customer 
foreclosure in relation to general entertainment channels.  
(239)  In the general entertainment genre, Comcast broadcasts Universal Channel, Sy fy, 
E! in the UK , Ireland, Germany  and Austria ; as well as Movies 24 in the UK and 
Ireland ; 13th Street in Germany and Austria ; and Studio Universal in Italy.  
(240)  For the purposes of its assessment, the Commission has considered, in particular, 
as the more likely potential targets of a customer foreclosure strategy, the 
channels that compete closely with  Comcast's channels.  
(241)  As noted in paragraph s (156)  and (167)  above  in relation to the UK, Ireland, 
Germany and Austria , Comcast's channels  can be considered to closely compete 
with the following:  
(a) In the UK and Ireland: close competitors to Universal Channel and Syfy 
include Fox (21CF), W and Alibi (both UKTV) ; 
(b) In Germany  and Austria:  13th Street and Syfy can be considered to closely 
compete with Fox (21CF) , RTL Crime (RTL), TNT Serie and TNT Film 
(both Time Warner) . 
(242)  In addition, the Notifying Party submits that Universal Channel closely competes 
with TNT Serie ( in Germany ); E! closely competes with MTV (Viacom) and TLC  
(Discovery)  (both in the UK and Ireland) and Sixx (ProSieben Sat )(Germany and 
Austria) ; and Movies24  closely competes with TCM (Time Warner ) (UK and 
Ireland) .  
(243)  Finally, in Italy, the Notifying Party states t hat Studio Universal , the sole general 
entertainment channel wholesaled by Comcast, has  a negligible audience : while 
there are no close competitors to Studio Universal , channels with similar content 
include: FOX, Viacom A+E Crime and Investigation, Gambero  Rosso . 
6.2.3.3.  The Notifying Party’s views  
(244)  The Notifying Party submits that the merged entity would have no ability to  
totally  or partially foreclose rivals as there are other TV retailers competing to 
purchase broadcasting rights  in each of the relevant Member States.  In addition, 
because Sky has entered in multi -year carriage agreements, wholesale suppliers 
would be protected against any attempt by the merged entity to impede access to 
its retail platform. Furthermore, the merged entity would lack the ability t o 
partially foreclose competing channels due to regulatory and contractual 
protections in favour of wholesale suppliers.  
(245)  Furthermore, the Notifying Party argues that Sky’s product offering relies on 
content diversity, such that any degradation in its retai l line -up, especially in 
general entertainment, would only benefit its competitors. The Notifying Party 
notes that any benefits from total or partial customer foreclosure in the form of 
increased viewership of NBCU and Sky channels on Sky’s platform would be 
speculative and minimal in comparison to Sky’s much greater downstream 
subscription revenues. Accordingly, the Notifying Party submits that it would be 
commercially irrational for the merged entity to fully or partially foreclose 
competing TV channels.  
 
44 (246)  The Commission’s assessment of customer foreclosure risks in each of the 
relevant territories is set out below.  
6.2.3.4.  The Commission’s assessment - UK and Ireland  
(247)  From the outset, the Commission recalls that Sky is already vertically integrated 
in that it alread y owns a portfolio of channels in addition to being present 
downstream as a distribution platform. T he merger specific aspect in this regard is 
limited to  the addition of Comcast 's TV channels.  
(a) Ability to engage in customer foreclosure  
(i) Sky's importance as a distribution platform  
(248)  At the outset, f or customer foreclosure to be a concern, the transaction must 
involve a company with a significant degree of market power as a customer in the 
downstream market.  
(249)  Downstream, Sky has a market share of [30-40]% in the UK and [40-50]% in 
Ireland for the acquisition of TV channels.68 Sky is the leading pay -TV retailer in 
the UK and Ireland. Sky's share of all pay -TV services on the basis o f revenues is 
[60-70]% in the UK and [60-70]% in Ireland.69 Sky's platform al lows 
broadcasters to access [30-40]% of pay -TV subscribers in the UK and [40-50]% 
in Ireland. 70 
(250)  Several TV channel  suppliers consider that distribution on Sky is very important  
to them  given Sky's  position as a pay-TV platform with a  large customer base 
resulting in higher audiences and accompanying revenues.71 Several TV 
broadcasters also indicated that the majority of their revenues are derived from 
distribution on Sky’s platform.72  
(ii) Ability to engage in total foreclosure  
(251)  As to the ex tent of Sky's bargaining power, the results of the market investigation 
were mixed. While the majority of wholesale suppliers of TV channels in the UK 
and Ireland consider that Sky currently does not have  significant bargaining 
power , a small but significa nt minority of them considered that Sky has such 
bargaining power .73 Furthermore, market participants do not expect new entry at 
the retail level in the UK or Ireland offering a distribution scale comparable to 
Sky.74   
                                                 
68  Form CO, Table 25.  
69  Form CO, Annex 7.4, Tables 38.1 and 38.2.  
70  Form CO, Annex 7.4, Tables 38.6 and 38.7.  
71  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.4.1.  
72  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.3.  
73  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.4.  
74  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.10 and D.11.  
 
45 (252)  The market investigation did not provi de reasons to consider that s witching to 
FTA distribution and self -retailing on Sky’s platform would constitute viable 
alternative supply options for broadcasters.75 
(253)  In any event, the Commission considers that the following  factors militate against 
a finding of ability on the part of Sky to engage in full foreclosure of Comcast's 
closely competing channels Fox, W, Alibi, MTV, TLC  or TCM.  
(254)  First, Sky's carriage agreement with [company name ] will not expire until [term 
time] and termination by Sky is only possible in very specific and li mited 
circumstances; [company name ] carriage agreements will not expire until [term 
time] and termination by Sky is only possible in very specific and limited 
circumstances. Therefore,  an ability  on the part of Sky to foreclose [company 
names ] cannot be held to arise in light of the applicable contractual provisions . 
(255)  Second, despite limited retail market shares, alternative purchasers  in the UK  and 
Ireland represent a material  share of acquisition  of licensing rights : namely 
Liberty Global, BT and Talk Talk in the UK  (respectively [50-60]%, [5-10]% and 
[5-10]% of shares in the acquisition of TV channels ) and Liberty Global, Eir and 
Setanta  in Ireland (respectively [40-50]%, [10-20]% and [5-10]%). Therefore, a 
strategy of ceasing to purchase from competing wholesale TV channel  suppliers 
would still leave  broadcasters with the possibility to access  a material  portion of 
the market.  
(256)  In light of the above, the Commission considers that overall the m erged entity 
would lack the ability to engage in the total customer foreclosure strategies 
considered above.  
(iii) Ability to engage in partial foreclosure  
(257)  The market investigation indicated that a small majority of respondents in the UK 
and Ireland consider  that the merged entity will be able to degrade distribution 
terms  in particular by diminishing carriage fees .76 UK-based broadcasters are also 
concerned with EPG slot degradation and Sky pushing for its own content over 
the Sky Q interface although respondent s also emphasize that Sky’s UK EPG 
listing is subject to regulation and adheres to its published methodology.77 
(258)  As indicated above, however, the only merger specific element pertinent to the 
present assessment of partial foreclosure is the addition of Comcast's channels. 
Comcast's general entertainm ent channels comprised just [ redacted ]% of all 
                                                 
75  FTA distribution involves a different business model which essentially relies on advertising 
revenues where pay -TV channels generate revenues fr om carriage fees and advertising. Switching 
from a pay -TV to an FTA model would entail considerable uncertainty and may induce losses in 
revenues. Furthermore, in Fox / Sky  (paragraph 308), the Commission noted that i n the course of the 
market investigatio n, several market participants explained that self -retailing does not constitute a 
commercially viable alternative absent premium content capable of attracting clients to channels 
marketed outside of a Sky package . 
76  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.6.  
77  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.7.  
 
46 viewing on Sky’s plat form in 2015 to 2017, which is lower than the channels of 
UKTV, Viacom and Discovery .78  
(259)  The Commission considers that a number of elements exist which militate against 
a finding of the ability of the merged entity to engage in partial customer 
foreclosure in the present case.   
(260)  As regards potential partial foreclosure via a reduction of carriage fees, the 
Commission notes that [details of Sky carriage agreements including term ]. This 
therefore affords protection in relation to [supplier names ] carriage fees revenue 
until at least the expiry of those contracts.  
(261)  As regards a degradation of EPG ranking, the Commission notes that EPG 
regulations are applicable to Sky in the UK.  
(262)  The UK regulator, Ofcom , has a code of practice on EPGs (the EPG Code) which 
ensure s that any agreement with broadcasters for the provision of an EPG service 
is made on FRAND terms. Moreover, Sky is required to refrain from giving 
undue prominence in any listing or display to a channel connected to Sky. Sky 
also needs to carry out periodic  reviews of its listing policy and of channel listings 
made in accordance with that policy, in consultation with channel providers.79  
(263)  In addition, Sky is subject to Sky -specific regulation  (EPG Conditions)  that 
requires Sky (i) to provide EPG services upon  request and on a fair, reasonable 
and non -discriminatory basis, (ii) not to discriminate or show undue preference to 
any particular persons or class of persons, (iii) a requirement to publish a notice 
specifying, or specifying the method that is to be ado pted for determining, the 
charges and other terms and conditions.80 Consequently, Sky set out its EPG 
listing methodology in a public document ("Method of Allocating Listings in 
Sky's EPG").  A violation of those regulatory obligations would be easily detect ed 
by the interested party, which would likely complain with the competent 
regulatory authorities.  
(264)  The Commission considers that in light of these regulations in the UK, the 
merged entity  would not be able  to foreclose Comcast's closely competing 
channels  via EPG degradation in the UK  without infringing regulation which 
would expose it to significant penalties, as described below in paragraph (280) . 
(265)  The Commission notes that whereas no comparable regulation exists in Ireland, 
the information submitted by the Notifying Party indicates that Sky broadcasts the 
same EPG in the UK and Ireland and therefore the Irish EPG also reflects the UK 
regulatory constraints.  
(266)  The Commission has also considered partial foreclosure via the Sky Q set top  
boxes , which Sky has introduced in the UK and Ireland . The Sky Q set-top box 
provide s users with n ew services available on its interface, including "Home" 
(previously “My Q” ) an application listing content available to subscribers based 
on the type of content that they have been watching, u sing algorithms determined 
                                                 
78    Reply to RFI 4, page 57.  
79  See Form CO, paragraph 364.  
80  See Form CO, paragraph  365. 
 
47 by Sky to suggest  viewing recommenda tions. The criteria used to select content 
and channels through these algorithms are not subject to regulation.  
(267)  However, in this regard the Commission notes that Sky Q is currently only 
available to new subscribers or to customers who seek to upgrade to th at set -top 
box. Accordingly, only [number of Sky Q box subscribers ] subscribers in the UK, 
and [number of Sky Q box subscribers ] in Ireland  have Sky Q box. This amounts 
to c. [redacted ]% and [ redacted ]% of Sky subscribers  in respectively the UK and 
Ireland .81 Moreover, the Sky Q box does not present channels only via the Home 
application . On the contrary, the Sky EPG is positioned at the top of the list of 
options in the Sky Q box menu, above the  My Q application . Data submitted by 
the Parties regarding the Sky Q box also indicates that [Sky’s confidential internal 
analysis ]. These elements do not indicate neither an ability on the part of Sky to 
engage in a partial foreclosure strategy via the Home (previously My Q) function 
of Sky Q, nor a material likely impact on effective competition if the ability of 
Sky to partially foreclose  via the Home (previously My Q) function of Sky Q 
were to be assumed.  
(268)  Furthermore, the Commission notes that, based on the Notifying P arty's 
submission, [confidential information about the functioning of the “Home” 
section ]. On this basis, the Commission considers that a partial foreclosure via the 
Sky Q set top boxes  can be excluded.  
(269)  Finally, contractual commitments also restrict the wa y in which Sky makes 
available non -Sky VOD content on its on -demand platform in the UK and 
Ireland.82  
(270)  In light of all the above, the Commission considers that overall the merged entity 
would lack the ability to engage in the partial customer foreclosure st rategies 
considered above.  
(b) Incentive to engage in customer foreclosure  
(i) Incentive to engage in full foreclosure  
(271)  The Commission has assessed the likelihood of full foreclosure in the UK and in 
Ireland.  
(272)  First, the majority of the UK and Irish broadcasters ar e not concerned that the 
transaction would result in full customer foreclosure : they consider that the 
merged company would probably carry on licensing third party TV channels as 
the separate companies do today and would not stop sourcing TV channels from 
third parties, and exclusively rely on its own TV channels. 83 In this regard , a 
broadcaster noted that the merged entity was more likely to maintain a broad 
selection of channels (including of third parties) given that consumer s generally 
prefer a wide selection of channels.  
                                                 
81  Form CO, Table 28.  
82  According to the Notifying Party, Sky has provided guarantees in its carriage agreements with each 
of [company names ] with regard to [details of guarantees included in Sky’s carriage agreements ]. 
83  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2 018, question D.5.  
 
48 (273)  Second, a number of Sky’s internal documents indicate that [description of Sky’s 
internal documents ].84 The Notifying Party states that offering a wide variety of 
channels is particularly important for a premi um pay -TV operator such as Sky, 
which needs to justify its tariff structure to subscribers in order to ensure they do 
not switch away to more cost -effective alternatives. Notably, in this respect,  while 
UKTV (W and Alibi) is concerned about the merged enti ty's potential to engage 
in partial customer foreclosure, it believes that is unlikely that it would be fully 
foreclosed .  
(274)  Third , given NBCU’s limited presence as a wholesal e supplier of TV ch annels, 
representing less than [ redacted ]% of viewing share on S ky's retail platform85, the 
Proposed Transaction is unlikely to bring  about changes in the merged entity’s 
incentives in its purchasing of TV  channels from other wholesaler suppliers.  
(275)  Fourth , the closest competitors of NBCU in the general entertainment gen re are 
major TV broadcasters that typically supply a popular suite of channels to Sky’s 
retail platform, including in respect of channels outside of the general 
entertainment segment and in respect of content used by Sky on its own TV 
channels. The importa nce of Sky’s commercial relationships with broadcasters 
renders a hypothetical wholesale foreclosure strategy in the basic pay -TV general 
entertainment segment risky as the affected broadcasters could retaliate on the 
basis of commercial relationships in o ther markets.  
(a) For example, UKTV, which is a close competitor to Universal Channel 
and Syfy in the UK and Ireland, has an audience shar e in general 
entertainment of [ 20-30]% in the UK and [ 10-20]% in Ireland . Therefore, 
the Commission considers it unlikely  that Sky would be incentivised to 
foreclose UKTV’s channels to benefit the Universal and Syfy channels, 
which represent a less significant proportion of the genre in the UK and 
Ireland. Moreover, the Notifying Party submitted an internal document of 
Sky, indicating that “ [quote from Sky’s internal document ]”.86 
(b) Another example is Viacom, the owner of MTV, which is a close 
competitor to E! in the UK and Ireland. At group level, Viacom supplies a 
broad range of channels to Sky’s retail platform, including other key 
general entertainment channels like Comedy Central . Its share of audience 
is greater than that of all NBCU channels in aggregate in the UK and in 
Ireland, thereby demonstrating its importance to Sky.  
(c) Discovery, the owner of TLC which is a close competitor of E!, is an 
important  wholesale supplier of Sky in the UK and Ireland, particularly in 
the factual genre. In the UK, Discovery accounts for an au dience share of 
[5-10]% in the segmen t for all basic pay -TV and of [ 10-20]% by audience 
in Ireland. Its importance to Sky in the factual genre has been 
acknowl edged in the Fox/Sky  decision . 
(d) Time Warner, the owner of TCM , which competes closely with NBCU’s 
Movies 24 in the UK and Ireland, is an important input across the 
                                                 
84  Response to RFI 4, page 56.  
85  Form CO, Table 26.  
86  Response to RFI 4 of 4 June 2018, question 17, Annex 17.2.  
 
49 spectrum of Sky’s retail offering and particularly in film content licensing. 
The Notifying P arty submits that [details about Sky’s negotiating power ].  
(276)  Fifth , given Sky's subscription revenues largely outweigh Comcast's wholesale 
revenues, the adoption of a customer foreclosure strategy which would risk 
deteriorating Sky's offering in the hope of improving Comcast's upstream 
revenues does not appear to be profit able. Although the Notifying Party did not 
provide an assessment of the amount of customer diversion that would result from 
foreclosing competing channels nor quantifies the resulting gains for Comcast, 
the difference between NBCU's 2017 revenue from its w holesale operations  (UK: 
EUR [redacted ]; Ireland: EUR [redacted ]) and total subscription revenues for Sky 
(UK: EUR [redacted ]; Ireland: EUR [ redacted ]) appears significant.  
(277)  Furthermore, if a foreclosure strategy were to focus on certain but not all of 
Com cast's competitors, any resulting diversion of audience would also benefit 
Comcast's competitors that would remain on Sky's platform, reducing the 
prospective benefit of such a strategy.  
(278)  In light of the above, the Commission considers that overall the mer ged entity 
would lack the incentive  to engage in the total customer foreclosure strategies 
considered above.  
(ii) Incentive to engage in partial foreclosure  
(279)  The majority of broadcasters responding to the market investigation were 
concerned about possible incentives of the merged entity to degrade the terms and 
conditions of acquisition of rival TV channel s.87 One respondent mentioned that 
as Sky already has an incentive to favour its own channels and content over those 
of third  parties and, as the Proposed Transaction will increase the merged entity's 
own channel portfolio, it will also increase this incentive.88 
(280)  In the UK, as explained above, there are strict restrictions on Sky’s (and therefore 
the merged entity’s) ability to d egrade the way in which wholesalers’ TV 
channels appear on its platforms. The regulatory regime preventing Sky from 
degrading other wholesalers’ TV channels acts as a deterrent to its incentives, not 
least given the potential remedies that the relevant com munications authorities 
can impose are stringent, including, the revocation of Sky’s licence. Such 
sanctions are significant potential costs that reduce the merged entity’s incentive 
to degrade the way in which it partners with third party wholesalers. The 
information submitted by the Notifying Party indicates that Sky has never been 
found in breach of this regulation.89 
(281)  As regards degradation via My Q on Sky's "Sky Q," as indicated above  in 
paragraph (267) , viewing data for Sky Q subscribers from March 2018 show that 
[Sky confidential internal analysis ]. Therefore, the role that alternative program 
recommendation tools play remains [redacted ] to dat e, thus providing l ittle 
incentive for Sky to use this tool to divert viewing to Comcast's channels . 
                                                 
87  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.6.  
88  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.6.2.  
89  See Form CO, paragraph 363. 
 
50 (282)  As regards EPG degradation in  Ireland, whilst  the British EPG regulations are not 
mandatory, the information submitted by the Notifying Party indicates that Sky 
broadcasts th e same EPG in the UK and Ireland and therefore the Irish EPG also 
reflects the UK regulatory constraints.  This may be considered to constrain Sky's 
incentives to engage in partial foreclosure by way of EPG degradation.  
(283)  In light of the above, the Commission considers that overall the merged entity 
would lack the incentive  to engage in the partial customer foreclosure strategies 
considered above.  
(c) Impact on effective competition of full/partial foreclosure  
(284)  In Fox / Sky , the Commission noted that g iven Sky's importance as a distributor of 
pay-TV services, Sky  appears to be an important source of advertising and 
carriage revenues .90 The market investigation did not provide indications that this 
would no longer be the case.  UK b roadcasters have stated  that being foreclosed 
from Sky's platform would have a significant adverse impact on their revenues .91 
(285)  However, as indicated above, the agreement s in place between Sky and wholesale 
TV channel suppliers afford protection in relation to carriage fees. The regulation 
in place in the United Kingdom in relation to EPG also affords protection against 
impact on wholesale TV channel suppliers which may result from partial 
foreclosure via EPG degradation for wholesale TV channel suppliers ' channels. 
Similarly, the information on file from the Notifying Party indicates that Sky 
broadcasts the same EPG in the UK and Ireland and therefore the Irish EPG also 
reflects the UK regulatory constraints. As regards degradation via My Q on Sky 
Q, the Comm ission considers that the effect on wholesale TV channel suppliers , 
which may result from such a foreclosure strategy, is, in light of information on 
file and referred to above in paragraph  (267) , unlikely to be significant . 
(286)  In addition, Sky’s retail platform is no t the only purchaser of general  
entertainment TV channels in the UK and Ireland, where Sky’s downstream share  
of TV channel acquisitions is in the range of [30-40]% ([30-40]% in the UK and 
[40-50]% in Ireland) . In the event  that Sky sought to cease carrying third party 
channels on its platform, a large  proportion of the retail market would remain for 
third party w holesalers to  access.  
(287)  As a consequence, it is unlikely that the customer foreclosure strategies 
considered above would have a significant negative impact on consumers.  
Consequently, the adoption of a foreclosure strategy would not appear to have a 
material  effect on competition in the UK and Ireland.  
(d) Conclusion  
(288)  On the basis of the foregoing, the Commission therefore concludes that the 
Proposed Transaction does not raise serious doubts as to its compatibility with the 
internal market resulting from partial o r total customer foreclosure in the United 
Kingdom and Ireland.  
                                                 
90   Fox / Sky , paragraph 338.  
91  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.9.  
 
51 6.2.3.5.  The Commission's assessment - Germany and Austria  
(289)  From the outset, the Commission recalls that Sky is already vertically integrated 
in that it already owns a portfolio of channels in addition to being present 
downstream as a distribution platform. T he merger specific aspect in this regard is 
only the addition of Comcast 's TV channels.  
(a) Ability to engage in customer foreclosure  
(i) Sky's importance as a distribution platform  
(290)  Downstream , Sky has a market share of [ 30-40]% in Germany and [40-50]% in 
Austria for the acquisition of TV channels.92 The Notifying Party estimates that 
Sky’s share of all retail pay -TV services amounts to [20-30]% by revenue  in each 
of Germany  and Austria93 (which makes Sky th e leading pay -TV retailer in 
Germany by revenue and the second largest in Austria ) and [ 10-20]% by 
subscribers in Germany and [ 10-20]% in Austria.   
(291)  However, as the Commission noted in its decision in case M.8354, Fox/Sky , other 
sources credit Sky with higher market shares by revenue, in the range of  50 to 
60%.94 While t he Notifying Part y disputes these estimates, it  admits  that Sky’s 
position in the retail market in Germany and Austria has not changed significantly 
in the last two years.  
(292)  The results of the market investigation confirm that Sky's retail platform is 
significant to channel broadcasters, respondents to the market investigation 
having indicated that Sky is the biggest pay -TV platform in the German speaking 
territories.95 
(ii) Ability to engage in total foreclosure  
(293)  The market investigation revealed that the majority of wholesale suppliers of TV 
channels consider that Sky currently has significant bargaining power and is able 
to impose unfavourable contract term s.96 Furth ermore, a respondent  noted that the 
revenues it derive s from Sky exceed s the revenues of all other pay -TV platforms 
combined.  
(294)  As indicated above, t he only merger specific element pertinent to the present 
assessment of full customer foreclosure is the addition of  13th Street and Syfy , 
Universal Channel  and E!.  
(295)  13th Street and Syfy can be considered to closely compete with Fox (21CF), RTL 
Crime (RTL), TNT Serie and TNT Film (both Time Warner); Universal Channel 
also with TNT Serie ; and,  E! with Sixx (ProSieben Sat ). Comcast's general 
entertainment channel s comprised just [ redacted ]% of all viewing on Sky’s 
                                                 
92  Form CO, Table 25.  
93  Form CO, Annex 7.4, Tables 38.3 and 38.4.  
94  Commission decision of 7 April 2017 in case M.8354 – Fox/Sky , recital 342. 
95  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.4.1 . 
96  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.4.  
 
52 platform in 2015 to 2017, which is lower than the channels TLC, TNT Serie and 
RTL Crime.97 
(296)  Sky's offering relies on a wide range of high quality conten t in order to satisfy 
customers' expectations. Accordingly, no respondent to the market investigation 
expressed a concern that Sky would cease licensing all third party channels. 
Therefore, customer foreclosure, if any, could not concern more than a few of  
Sky's current suppliers.  
(297)  In this context, Sky's carriage agreements with third party channel providers are 
typically [duration of Sky’s carriage agreements ]. In this respect, Sky currently 
has carriage agreements with providers  [names of suppliers and ter m of carriage 
agreements ], such that t he merged entity's ability to foreclose these suppliers can 
be excluded . 
(298)  However, Sky' carriage agreement with [supplier names ], which broadcast 
channels that closely compete with Comcast's channels, will terminate [term of 
Sky’s carriage agreements ]. 
(299)  On this basis, while several elements will constrain the merged entity's ability to 
engage in total foreclosure, the Commission cannot rule out that the merged entity 
will have the ability to cease carrying a number of c hannels that compete closely 
with Comcast's in Germany and Austria.  
(iii) Ability to engage in partial foreclosure  
(300)  A small majority of respondents fear that the merged entity will be able to 
degrade distribution terms, in particular by diminishing carriage fees or the 
granting of unfavourable EPG slots.98 
(301)  As indicated above, the only merger specific element pertinent to the present 
assessment of partial  customer foreclosure is the addition of Comcast's channel s 
to Sky's portfolio .  
(302)  The Commission considers that a number of other elements exist which militate 
against a finding of the ability of the merged entity to engage in partial customer 
foreclosure in the present case.   
(303)  As regards partial foreclosure via lowering carriage fees, the Commission notes 
that Sky's a bility to foreclose channels competing with Comcast's channels is 
strictly constrained by applicable contractual provisions. In this regard, the 
merged entity's ability to reduce carriage fees can be excluded in relation to 
broadcasters currently protected  by multi -year agreements, as noted above in 
relation to total foreclosure.  
(304)  As regards EPG ranking, i n Germany, Sky is subject to regulation requiring it to 
(i) allocate listings based on an objective metric (audience viewing figures) and 
(ii) refrain from  unduly discriminating between  channels. Any changes to Sky’s 
                                                 
97  Reply to RFI 4, pa ge 57.  
98  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, questions D.6 and D.6.1.  
 
53 EPG methodology in Germany are subject to mandatory prior notification to the 
State Media Authority. 99 
(305)  In Austria, Sky employs an EPG listing methodology similar to the one 
implemented in German y in order to comply with the Austrian EPG Regulation. 
The Austrian EPG Regulation removes any ability for the merged entity to 
deteriorate the EPG listings of third party wholesale channels. The regime is 
founded on the principle of non -discrimination. Th e Austrian Communications 
Authority (KommAustria) has significant powers to sanction Sky were any 
discriminatory behaviour substantiated (including the revocation of its licence to 
operate its Sky Sport Austria channel in the country).100 
(306)  A violation of thos e regulatory obligation s would be easily detected by the 
interested party, which would likely complain with the competent regulatory 
authorities.   
(307)  In light of all the above, the Commission considers that overall the merged entity 
would not be able  to engage in the partial customer foreclosure strategies in the 
form of EPG degradation without infringing regulation which would expose it to 
significant consequences, as described below in paragraph  (318) . 
(b) Incentive to engage in customer foreclosure  
(i) Incentive to engage in full foreclosure  
(308)  The Commission has assessed the likeli hood of full foreclosure in Germany and 
in Austria . 
(309)  While a number of German broadcasters are concerned that the merged entity 
might reduce its reliance on third party channels, albeit not for the totality of its 
line-up,101 other broadcaster s consider that the merged entity 's incentives in 
relation to third party channels will  not change as a result of the Proposed 
Transaction.102 Therefore, no clear view on the merged ability's incentives to 
foreclose competing channels can be deducted from the market investigation.  
(310)  Given Comcast’s limited presence as a wholesale supplier of TV channels, 
repre senting [ redacted ]% of viewing share on Sky's retail platform ,103 the 
Proposed Transaction is unlikely to bring about changes in the merged entity’s 
incentives in its purchasing of TV channels from other wholesaler suppliers. 
Moreover, channel s which compete closely with Comcast's channels (including 
TNT Serie and RTL Crime ) have significant individual audience shares (of [5-
10]% and [ 5-10]% respectively ), demonstrating their importance as inputs to 
Sky’s retail platform.   
                                                 
99  Form CO, paragraph 366.  
100  See Form CO, paragraph 367. 
101  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.5.  
102  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.5.1.  
103  Form CO, Table 26.  
 
54 (311)  Sky's internal custom er surveys further demonstrate the importance of channels 
that closely compete with Comcast's for subscriber retention. Sky's 2017 survey 
results show that [results of Sky’s customer survey ]. 
(312)  In Germany and Austria, FTA television remains more developed th an pay -TV. 
Pay-TV retailers like Sky therefore have an overall incentive to improve pay -TV's 
penetration by making its basic pay -TV offering attractive to consumers. 
Therefore, f ull foreclosure of competing channels TLC, TNT Serie and RTL 
Crime would be at  odds with this.  
(313)  In addition, as noted by the Notifying Party, t he closest competitors of NBCU in 
the general entertainment genre are major TV broadcasters that typically supply a 
popular suite of channels to Sky’s retail platform, including in respect of channels 
outside of the general entertainment segment and in respect of content used by 
Sky on its own TV channels. The importance of Sky’s commercial relationships 
with broadcasters renders a hypothetical wholesale foreclosure strategy in the 
basic pay -TV general entertainment segment risky as the affected broadcasters 
could retaliate on the basis of commercial relationships in other markets. In 
particular:  
(a) [Details of Sky’s carriage agreement and on -going negotiation ]. 
(b) [Details of Sky’s carriage agreement ]. The Notifying Party submitted an 
internal document104 showing [details of a Sky internal document 
concerning viewership data ]. 
(314)  Given that Sky's subscription revenues largely outweigh Comcast's wholesale 
revenues, the adoption of a customer foreclosure str ategy which would risk 
deteriorating Sky's offering in the hope of improving Comcast's upstream 
revenues does not appear to be profitable. Although the Notifying Party did not 
provide an assessment of the amount of customer diversion that would result from  
foreclosing competing channels nor quantifies the resulting gains for Comcast, 
the difference between NBCU's 2017 revenue from its wholesale operations 
(Germany: EUR [redacted ]; Austria: EUR [redacted ]) and total subscription 
revenues for Sky (Germany: EU R [redacted ]; Austria: EUR [ redacted ]) appears 
significant.  
(315)  If a foreclosure strategy was  to focus on certain but not all of Comcast's 
competitors, any resulting diversion of audience would also benefit Comcast's 
competitors that would remain on Sky's platform, reducing the prospective benefit 
of such a strategy.  
(316)  In light of all the above, th e Commission considers that overall the merged entity 
would not have the incentive  to engage in total foreclosure of Comcast's 
competing channels  in Germany and Austria as a result of the Proposed 
Transaction.  
                                                 
104  Response to RFI 4 of 4 June 2018, question 17, Annex 17.3.  
 
55 (ii) Incentive to engage in partial foreclosure  
(317)  The results of the market investigation show that a number of German 
broadcasters are concerned about potential degradation of the terms and 
conditions for the acquisition of their channels  and the granting of unfavourable 
EPG slots.105 
(318)  However, as noted above , EPG regulations in Germany and Austria require that 
broadcasters be treated fairly and in a non -discriminatory fashion. Under the 
applicable German regulation, in the event of an infringement of those 
obligations , the State Media Authority would be able t o impose an administrative 
fine of up to EUR 500 000. The State Media Authority also has the power to 
revoke an infringing operator’s EPG licence. Similarly, in case of an infringement 
of Austrian EPG regulations, the Austrian  Communications Authority  can order 
remedies and, should Sky fail to comply, revoke Sky's licence. Sky's incentives in 
relation to degradation of EPG rankings could therefore also be considered to be 
constrained in light of these significant consequences.  
(319)  Furthermore, as noted in rela tion to total customer foreclosure, i n Germany and 
Austria, FTA television remains more developed than pay -TV.106 Pay-TV 
retailers like Sky therefore have an overall incentive to improve pay -TV's 
penetration by making its basic pay -TV offering attractive to consumers. As a 
consequence, it is unlikely that Sky would have an incentive to make its basic 
offering less attractive to consumers by degrading access to Comcast's competing  
channel s. 
(320)  In light of all the above, the Commission considers that overall the merged entity 
would not have the incentive  to engage in partial  foreclosure of Comcast's 
competing channels  in Germany and Austria as a result of the Proposed 
Transaction.  
(c) Impact on effec tive competition of full/partial foreclosure  
(321)  As indicated above, certain broadcasters' current distribution agreements with Sky 
in relation to Germany and Austria will protect them against total foreclosure 
until their term, thus safeguarding their positio n for the foreseeable future.  
(322)  As regards [supplier names and term of carriage agreement s], these broadcasters 
generate significant licensing revenues from alternative sources. The evidence on 
file shows that these broadcasters do not generate the majority of their licensing 
revenues from Sky in Germany and Austria. Therefore, even in the event of total 
or partial foreclosure from Sky's retail platform, these broadcasters would 
continue to operate efficiently.  
(323)  Consequently, in light of these elements , the Co mmission considers that full or 
partial foreclosure strategies are not likely to  have a n overall likely  significant 
impact on effective competition  in the market in question  in Germany and 
Austria.  
                                                 
105  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, questions D.6 and D.6.1.  
106   The FTA au dience in Germany in 2017 was [ 10-20] million, compared with [0-5] million for pay -
TV (see Reply to RFI 4, para. 18.9))  
 
56 (d) Conclusion  
(324)  On the basis of the foregoing, the Commission t herefore concludes that the 
Proposed Transaction does not raise serious doubts as to its compatibility with the 
internal market in relation to full or partial customer foreclosure in Germany and 
Austria .  
6.2.3.6.  The Commission's assessment - Italy 
(a) Ability to engage in customer foreclosure  
(i) Sky's importance as a distribution platform  
(325)  Downstream, Sky represents [ 90-100]% of the total spend on the acquisition of 
TV channels.107 In Italy, Sky’s share of all retail pay -TV services amounts to [70-
80]% by revenue and [50-60]% by subscribers. 108  
(326)  A majority of respondents to the market investigation indicate that Sky currently 
has normal bargaining power , with negotiations being on an ordinary and equal 
footing . 109 However, a broadcaster expressed concern about Sky's large market 
position .  
(ii) Ability to engage in total or partial foreclosure  
(327)  During the market investigation, Italian b roadcasters raised concerns that the 
merged entity would engage in complete customer foreclosure  of certain third 
party channels . 110 
(328)  The only  merger specific change which is to be considered in relation an 
assessment of customer foreclosure is the addition of Comcast's channel  Studio 
Universal to Sky's channel portfolio.  
(329)  While some channels, i.e. FOX, Viacom, A+E’s Crime and Investigation and 
Gambero Rosso do broadcast content that to some degree overlaps with that of 
Studio Universal, there are no third party channels closely competing with Studio 
Universal in Italy within the general entertainment segment.111 Studio Universal 
typically broadcas ts library film content and is therefore not a close substitute for 
subscribers seeking alternatives to other general entertainment channels such as 
FOX, Fox Crime, Comedy Central or Crime + Investigation (which focus on 
crime dramas and comedy series). Th e latter channels have higher audience 
shares than Studio Universal (which does not register as generating an audience 
share in the data available to the Parties112): Fox ([ 50-60]% audience share), 
Viacom ([ 5-10]% audi ence share) and Gambero Rosso ([ 0-5]% au dience share), 
Discovery ([ 0-5]% audience share).113  
                                                 
107  Form CO, Table 25.  
108  Form CO, Annex 7.4, Tables 38.5 and 38.10.  
109  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, ques tion D.4.  
110  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.5.  
111  Reply to RFI 4, para. 17.18.  
112   See Reply to RFI 4, para. 17.17, referring to Table 14 in Annex 7.4 to the Form CO.  
113  Reply to RFI 4, para. 19.5.  
 
57 (330)  As in other countries, Sky's offering in Italy relies on a wide range of high quality 
content in order to satisfy customers' expectations. Accordingly, no respondent to 
the market investigation expressed a concern that Sky would cease licensing all 
third party channels. Therefore, customer foreclosure, if any, could not concern 
more than a few of Sky's current suppliers.  
(331)  In this context, Sky's carriage agreements with third party channel providers are 
typically [duration of Sky’s carriage agreements ]. In this respect, Sky 's carriage 
agreements with the majority of its channel providers [names of suppliers and 
term of carriage agreements ], such that the merged entity's ability to foreclose 
these suppliers ca n be excluded.  
(332)  However, Sky' carriage agreement with [company name ], which broadcast 
channels that fall under the same thematic content as Comcast's channels, will 
terminate [term of the carriage agreement and details of the commercial relation 
between the  parties ]. Nevertheless, [company name ] alone represents the majority 
of the audience of basic general entertainment channels in Italy, such that Sky 
would not be in a position to cease to distribute its channels without significantly 
deteriorating its off ering.  
(333)  Furthermore, t he structure of the Italian television sector is similar to that in 
Germany and Austria, in the sense that FTA television remains more developed 
than pay -TV. In Fox / Sky , the Commission noted that in 2015 the pay -TV 
services represent ed only 36% of all retail television revenues in Italy, with FTA 
channels generating 64% of all revenues.  Pay-TV retailers like Sky therefore have 
an overall incentive to improve pay -TV's penetration. The market investigation 
did not provide any indication  that such an incentive would no longer exist. As a 
consequence, Sky's ability to engage in full foreclosure appears impacted by its 
incentive to make its basic pay -TV offering attractive to consumers. Full 
foreclosure of channels with similar content as S tudio Universal would be at odds 
with this.  
(334)  Therefore, in light of Studio Universal's marginal position and the importance of 
other channels within its thematic category, the merged entity does not appear to 
be in a position to cease carrying third party channels.  
(335)  As to partial foreclosure, the respon ses to the market investigation were mixed. 
Some broadcasters however, consider that the merged entity would degrade the 
terms and conditions of the acquisition of TV channels from third parties , in 
particula r through worse contract terms . 
(336)  In relation to potential EPG degradation , the Commission notes that no formal 
EPG regulation  exist in Italy . However, the Italian Communication Authority 
(AGCOM) may impose on  operators the obligation to guarantee access to 
resources , including EPGs , on equitable, reasonable and non -discriminatory 
conditions, to the extent  necessary to guarantee access to digital radio and TV 
services by end users.  AGCOM has the power to intervene by imposing rules 
relating to access to  EPGs in the event it identifies any distortions in the 
behaviour of TV operators  that affect end users’ ability to access TV services. A 
breach of these rules can  result in a financial sanction of up to EUR 2.5 million, 
or up to 5% of the total  turnover of a co mpany with significant market power in 
the relevant market to  which the breach refers .  
 
58 (337)  However, given the lack of formal EPG regulation, the Commission does not 
consider that these elements constitute factors liable  to eliminate  the potential risk 
of part ial foreclo sure.114 
(338)  In light of all the above, the Commission considers that overall the merged entity 
would not have the ability  to engage in total foreclosure of Comcast's competing 
channels  in Italy as a result of the Proposed Transaction . However, whilst  there 
are elements which suggest a constraint on Sky's ability  to engage in partial 
foreclosure, the Commission cannot rule out that the merged entity will have the 
ability  to partially foreclose Comcast's closely competing channels in Italy as a 
result o f the Proposed Transaction.  
(b) Incentive to engage in customer foreclosure  
(i) Incentive to engage in full foreclosure  
(339)  The Commission has  assessed the likelihood of full foreclosure in Italy.  
(340)  During the market investigation, Italian broadcasters raised concerns that the 
merged entity would have an incentive to engage in customer foreclosure of 
certain third party channels.115 Broadcasters have pointed out that Sky has 
decreased the number of third party licensed channels in Ital y in the past 3 years 
while increasing promotional efforts for Sky -owned channels, thus forcing a 
number of channels to switch to an FTA model. Adding Comcast’s general 
entertainment channel to its portfolio w ould accelerate this trend .  
(341)  The only merger sp ecific change which is to be considered in relation an 
assessment of customer foreclosure is the addition of Comcast's channel Studio 
Universal to Sky's channel portfolio.  
(342)  In Italy, Comcast’s sole channel (Studio Universal) has a negligible market share 
by audience : indeed, the channel does not register as generating an audience share 
in the data available to the Parties .116 The combination of this channel with Sky’s 
retail platform in Italy is therefore unlikely to give rise to potential customer 
foreclosur e. Sky relies on 21CF ([50-60]% audience share), Viacom ( [5-10]% 
audience share) and Gambero Rosso ( [0-5]% audience share)  and other 
broadcasters for the vast majority of its audience . Even modest players like 
Discovery ([ 0-5]% audience share) are of greater value to Sky 's retail service  than 
Studio Universal.  
(343)  In addition, as noted in paragraph (333) , pay-TV retailers like Sky have an overall 
incentive to improve pay -TV's penetration. As a consequence, it is unlikely that 
Sky would have an incentive to make its basic offering less attractive to 
consumers by degrading access to channels that carry content that overlaps with 
the content on  Studio U niversal . 
                                                 
114  See in this regard, the Commission's Non -Horizontal Merger Guidelines, para. 46.  
115  Replies to Questionnaire Q2 to TV bro adcasters of 7 May 2018, question D.5.  
116  See Reply to RFI 4, para. 17.17, referring to Table 14 in Annex 7.4 to the Form CO.  
 
59 (344)  In light of the above, the Commission considers that overall the merged entity 
would lack the incentive to engage in the total customer foreclosure strategies 
considered above.  
(ii) Incentive to engage in partial foreclosure  
(345)  As to partial foreclosure , the responses to the market investigation were mixed, 
with some respondents considering that t he merged entity would degrade the 
terms and conditions of the acquisition of TV channels from third parties .  Other 
respondents were less concerned.  
(346)  By contra st with other Member States, Sky's EPG ranking of pay -TV channels 
does not appear significantly  constrained by regulations. As a consequence, Sky's 
incentives may not be materially  reduced by sector specific rules.  
(347)  However, in light of the structure of the Italian television sector (see paragraph 
(333) ) , it is unlikely that Sky would have an incentive to make its basic offeri ng 
less attractive to consumers by degrading access to channel s that carry content 
that overlaps with the content on Studio Universal . As noted above in relation to 
total foreclosure, Sky's retail service relies on third party channels for the vast 
majorit y of the audience within Comcast's channels thematic group. Therefore, in 
light of Comcast's negligible contribution to the merged entity's upstream 
position, a change of Sky's incentives in relation to the distribution of third party 
channels appears impl ausible.  
(348)  On this basis, the Commission considers, on balance, that the merged entity 
would lack incentives to engage in partial  foreclosure of Comcast's competing 
channels in Italy post -Transaction.  
(c) Impact on effective competition of full/partial foreclos ure 
(349)  As indicated above, the majority of  broadcasters' current distribution agreements 
with Sky  in relation to Italy  will protect them against total foreclosure until their 
term, thus safeguarding their position for the foreseeable future.  
(350)  In respect of 21C F, in the implausible event that the merged entity ceased 
distributing its channels,  the Commission notes that this  broadcaster  generate s 
significant licensing revenues from alternative sources. Therefore, even in the 
event of total or partial foreclosure from Sky's retail platform, 21CF would 
continue to operate efficiently.  
(351)  In light of these elements , the Commission considers that full or partial 
foreclosure strategies in Italy, are unlikely to  have a n overall likely  significant 
impact on effective competition  in the market in question . 
(d) Conclusion  
(352)  In light of the above, t he Commission therefore concludes that the Proposed 
Transaction does not raise serious doubts as to its compatibility with the internal 
market in relation to full or partial customer foreclosure in Italy .  
 
 
60 7. CONCLUSION  
(353)  For the above reasons, the European Commission has decided not to oppose the 
notified operation and to declare it compatible with the internal  market and with 
the EEA Agreement. This d ecision is adopted in application of Article 6(1)(b) of 
the Merger Regulation and Article 57 of the EEA Agreement . 
For the Commission  
Signed  
Phil HOGAN  
Member of the Commission