Norwegian cable TV distributors recently won an important battle before the Cable Dispute Committee. The background to the dispute was a disagreement with public service broadcaster TV2 Gruppen on the size of the copyright fee to be paid by the cable TV distributors for the retransmission of the channel TV2 to cable TV customers. The Cable Dispute Committee concluded that the copyright fee demanded by TV2 Gruppen was unreasonable and could, therefore, not be enforced. The compensation was set at the level that the cable TV distributors themselves found to be fair.
Norwegian cable TV distributors pay copyright fees to TV2 Gruppen for the right to distribute the channel TV2 to their cable TV customers. This in spite of the fact that all cable TV distributors are required by law to distribute TV2 due to the channel’s must carry status. During the period from 2006 to 2009, the TV2 Group raised the copyright fee charged to the cable TV distributors by 1,539% (from NOK 0.53 to NOK 8.70 per subscriber per month). This represented a total price increase of over NOK 100 million for 2009 alone. The grounds cited by TV2 for the price increase was the fact that the operators of other distribution platforms, such as DTH, DTT and IPTV, pay a much higher fee than the cable TV distributors, and this means, therefore, that the price that the cable TV distributors pay does not reflect the right market price.
In addition, it was pointed out that such an increase was required due to falling advertising revenue and was fair as TV2 is a very popular channel. The cable TV companies Get AS (formerly UPC), Canal Digital Kabel-TV AS and certain members of the cable TV organisation Kabel Norge found that the price increase was unreasonable based on market considerations and the fact that there was no foundation for the increase in copyright law. The TV2 Group brought the case before the Cable Dispute Committee for a resolution in the autumn of 2008. The Committee recently made a decision in the case and concluded that the copyright fees that TV2 demanded were unreasonable and could, therefore, not be enforced. Importance was attached, for example, to the fact that there were no relevant copyright issues that could justify the price increase, TV2’s popularity has not increased since 2006, and the committee “cannot make any direct comparison with other distribution platforms” for determination of copyright fees. The fees were instead set in accordance with the distributors’ claims, which were based on the price for 2006 with adjustments based on the consumer price index for 2007, 2008 and 2009.
The Committee’s decision is an important, fundamental decision in relation to key copyright issues related to the distribution of television broadcasts, and, for the cable TV distributors, the victory is also important with respect to their infrastructure investments.
The distributors also won a similar case before the Committee against the copyright organisation Norwaco earlier this year.
Haavind Partner Helge Olav Bergan represented and litigated the cases for the cable TV company Get AS.
For more information, please contact:
Helge Olav Bergan
h.bergan@haavind.no
+ 47 90 78 91 62