COMMISSION DECISION of 16/09/1996 declaring a concentration to be compatible with the common market (Case No IV/M.810 - n-tv) according to Council Regulation (EEC) No 4064/89

(Only the English text is authentic)

The paper version of the decision is available through the sales offices of the Office of Official Publications of the European Communities.

PUBLIC VERSION

MERGER PROCEDURE

ARTICLE 6(1)(b) DECISION

Registered with advice of delivery:

To the notifying parties

Dear Sirs,

Subject:<ind> Case N IV/M.810 ntv

<ind> <ind> Notification of a concentration pursuant to Article 4 of Council Regulation N 4064/89

1.<ind> On 12 August 1996, the Commission received a notification of a proposed concentration pursuant to Article 4 of Council Regulation (EC) No 4064/89 [OJ No L 395 of 30.12.1989; Corrigendum OJ No L 257 of 21.09.1990, p.13.] by which the undertaking GWF Gesellschaft fuer Wirtschaftsfernsehen mbH & Co. KG (GWF) belonging to the publishing group von Holtzbrink (Holtzbrinck) acquires within the meaning of Article 3 (1) b of the Council Regulation joint control of ntv Nachrichtenfernsehen GmbH & Co. KG and ntv Nachrichtenfernsehen Beteiligungs GmbH (ntv). As a result of the operation, GWF, Time Warner Entertainment Germany GmbH belonging to the group Time Warner (Time Warner) and CNN Germany Inc. belonging to the group Turner Broadcasting System Inc. (Turner Broadcasting) will jointly control ntv.

2.<ind> After examination of the notification, the Commission has concluded that the notified operation falls within the scope of Council Regulation No 4064/89 and does not raise serious doubts as to its compatibility with the common market and with the functioning of the EEA Agreement.

I.<ind> THE PARTIES

3.<ind> Holtzbrinck is a large German publishing group. Through Verlagsgruppe Handelblatt GmbH (to which GWF also belongs) the group is active in business news. GWF is a company established to produce and broadcast programs and program segments concentrating on economic and business contents for radio, television, video and other electronic media, as well as holding interests in enterprises which do business in this area.

4.<ind> Time Warner is a large sized media group, with Time Warner Entertainment Germany GmbH distributing movies and film entertainment, as well as holding participations in filmcompanies and television companies.

5.<ind> Turner Broadcasting is also a major media group. CNN Germany Inc. is a holding company set up to hold the participation in ntv Nachrichtenfernsehen GmbH & Co. KG and ntv NachrichtengfernsehenBeteiligungs GmbH.

6.<ind> ntv is a German television company which is broadcasting a German language news television program, distributed via satellite and cable. In 1995, ntv´s turnover amounted to [Deleted; business secret: less than ECU 50 million.].

II.<ind> CONCENTRATION

7.<ind> GWF will increase ntv´s capital and thereby acquire 25,00361% of the shares of ntv, after which the joint venture will be jointly controlled by GWF, CNN Germany and Time Warner. GWF, CNN Germany and Time Warner will have veto rights concerning major strategic decisions in ntv, e.g. the approval of program principles, the approval of substantial investments, the appointment or removal of the General manager and the approval of the annual budget if it deviates more than [...] from the last annual budget plan. Furthermore, ntv will continue to perform on a lasting basis all the functions of an autonomous economic entity. Moreover, the operation will not give rise to coordination of the competitive behaviour of the parties amongst themselves or between them and ntv. According to information provided by the parties, none of them solely or jointly controls another German television station. Holtzbrinck has only a minority share (15%) in one German station, and Time Warner has minority shares in three German television stations. CNN International Germany does not operate in the German language, nor does it broadcast only on a Germanywide basis. CNN generally operates Europeanwide in the English language.

III.<ind> COMMUNITY DIMENSION

8.<ind> The present operation has a Community dimension within the meaning of Article 1(2) of the Merger Regulation. The aggregate worldwide turnover of all the undertakings concerned amounted, in 1995, to more than ECU 5 billion (Time Warner about ECU [...], Turner Broadcasting about ECU [...] and Holtzbrinck about ECU [...]) and two of the undertakings achieved a Communitywide turnover of more than ECU 250 million (Time Warner about ECU [...] and Holtzbrinck about [...]). Only Holtzbrinck achieves more than twothirds of its respective Communitywide turnover within a single Member State, specifically Germany.

IV.<ind> ASSESSMENT UNDER ARTICLE 2 OF THE MERGER REGULATION

A.<ind> Relevant product market

9.<ind> ntv is a free commercial television company that is active in the television advertising market. The viewer shares of television programs affect the market position of a television company in the television advertising market. Normally, the more successful a company is with respect to viewer shares, the more successful it is in the television advertising market. It can be left open whether the viewer market constitutes a distinct relevant product market in the strict economic sense of the notion, since the viewer share will be taken into account in any event in the assessment of the company´s position in the advertising market.

B.<ind> Relevant geographic market

10.<ind> ntv is active throughout Germany with a German news program. In view of ntv´s specialized focus in terms of language, distribution and customers, the relevant geographic market for the television advertising market appears to be national, i.e. Germany. If there were a viewers´ market, it would also be regarded as a national market. However, as ntv´s German program can also be viewed in Austria via satellite and cable and as Autria is also a German speaking country, one could regard ntv as also being active in Austria. However, ntv is not primarily directed to Austrian viewers.

C.<ind> Competitive Assessment

11.<ind> According to the information provided by parties, ntv´s share in the German television advertising market is about 0.5%. Even if one regards CNN as active in the same geographic market, the additional market share would be very low. As Holtzbrinck does not control any German television station, the acquisition by Holtzbrinck will not lead to any addition of market shares. Furthermore, according to the information provided by parties, the viewer ratings of ntv are not higher than 35.000 households. One cannot regard these ratings as a potential which gives ntv market power. Holtzbrinck also can not be regarded as a potential competitor of ntv in the television markets. Moreover, although ntv is the only German language news channel, its modest number of viewers indicate that German customers currently do not demand a special news program for their information needs but use mostly thetraditional news magazines of other television stations that do not have specialized programs. This feature of German audiences would also limit any market power of ntv.

12.<ind> In view of the market position of ntv in Germany and the absence of actual or potential competition by Holtzbrinck in the markets in which ntv is active, it appears that the notified operation will have no impact on competition in the relevant markets. tv´s activities in Austra can be regarded as de minimis, as they only reflect the availability of German television programs also in Austria. Consequently, the proposed concentration does not create a dominant position as a result of which effective competition would be significantly impeded in the EEA or any substantial part of that area.

V.<ind> CONCLUSION

13.<ind> For the above reasons, the Commission has decided not to oppose the notified operation and to declare it compatible with the common market and with the functioning of the EEA Agreement. This decision is adopted in application of Article 6(1)(b) of Council Regulation N 4064/89.

For the Commission