Market Review Broadcasting Transmission Services in Ireland Consultation and Draft Decision Reference: ComReg 20/31 Version: Final Date: 11/05/2020 An Coimisiún um Rialáil Cumarsáide Commission for Communications Regulation 1 Lárcheantar na nDugaí, Sráid na nGildeanna, BÁC 1, Éire, D01 E4X0. One Dockland Central, Guild Street, Dublin 1, Ireland, D01 E4X0. Teil | Tel +353 1 804 9600 Suíomh | Web www.comreg.ie Broadcasting Transmission Services in Ireland ComReg 20/31 Additional Information Approval Legal Disclaimer This Consultation is not a binding legal document and also does not contain legal, commercial, financial, technical or other advice. The Commission for Communications Regulation is not bound by it, nor does it necessarily set out the Commission’s final or definitive position on particular matters. To the extent that there might be any inconsistency between the contents of this document and the due exercise by it of its functions and powers, and the carrying out by it of its duties and the achievement of relevant objectives under law, such contents are without prejudice to the legal position of the Commission for Communications Regulation. Inappropriate reliance ought not therefore to be placed on the contents of this document. 2 Broadcasting Transmission Services in Ireland ComReg 20/31 Table of Contents Overview ............................................................................................................. 9 Summary of Overall Preliminary Views.......................................................... 11 Retail Market Assessment .......................................................................................... 11 Wholesale Market Definition ....................................................................................... 14 Three Criteria Test ..................................................................................................... 16 Competition and SMP Assessment ............................................................................ 17 Competition Problems ................................................................................................ 19 Proposed Remedies ................................................................................................... 19 Next Steps .................................................................................................................. 20 Legal basis and regulatory framework........................................................... 23 2009 Broadcasting Act .................................................................................... 27 Previous Reviews of the BTS Markets ........................................................... 29 Current Review of the Relevant BTS Markets ............................................... 31 Key functional characteristic of 2rn’s network ............................................. 31 Information Sources Relied Upon .................................................................. 35 Consultation Process ...................................................................................... 36 Structure of the report ..................................................................................... 37 Introduction ...................................................................................................... 40 TV Transmission/Viewership Trends ............................................................. 41 Retail TV Broadcasting Assessment .............................................................. 47 DTT Demand-Side Substitution .................................................................................. 47 DTT Supply-Side Substitution..................................................................................... 54 DTT Geographic Scope .............................................................................................. 54 Preliminary Conclusions on Retail Television Broadcasting ........................................ 54 Radio Transmission/Listenership Trends ...................................................... 54 Retail Radio Broadcasting Assessment ........................................................ 58 Terrestrial Radio Demand-Side Substitution ............................................................... 58 Terrestrial Radio Supply-Side Substitution ................................................................. 58 Terrestrial Radio Geographic Scope........................................................................... 58 Preliminary Conclusions on Retail Radio Broadcasting .............................................. 58 Market A: The Market for Wholesale Access to National Terrestrial BTS ... 62 3 Broadcasting Transmission Services in Ireland ComReg 20/31 Description of Market A Wholesale Focal Product ...................................................... 63 Demand-Side Substitution .......................................................................................... 65 Supply-Side Substitution ............................................................................................ 67 Indirect Constraints .................................................................................................... 68 Geographic Scope ...................................................................................................... 69 Overall Preliminary Conclusions on Wholesale Market A Definition ............................ 70 Market B: The Market for Wholesale Access to DTT Multiplexing Services 70 Description of Market B wholesale focal product ........................................................ 71 Demand-Side Substitution .......................................................................................... 72 Supply-Side Substitution ............................................................................................ 73 Indirect Constraints .................................................................................................... 74 Geographic Scope ...................................................................................................... 74 Overall Preliminary Conclusions on Wholesale Market B Definition ............................ 74 Introduction ...................................................................................................... 75 Three Criteria Test – Market A ........................................................................ 75 High and Non-Transitory Barriers to Entry .................................................................. 75 No Tendency towards Effective Competition over the Relevant Time Horizon ............ 77 Insufficiency of Competition Law Alone ...................................................................... 78 Proposed Preliminary Conclusion on the Three Criteria Test in Market A ................... 78 Three Criteria Test – Market B ........................................................................ 79 High and Non-Transitory Barriers to Entry .................................................................. 79 No Tendency Towards Effective Competition over the Relevant Time Horizon .......... 82 Insufficiency of Competition Law Alone ...................................................................... 82 Proposed Conclusion on the Three Criteria Test in Market B ..................................... 83 Overview ........................................................................................................... 84 Framework for Assessing SMP ...................................................................... 84 Approach to Existing Regulation ................................................................................. 87 Assessment of SMP in Market A .................................................................... 87 Existing competition ................................................................................................... 88 Potential Competition ................................................................................................. 89 Countervailing buying power ...................................................................................... 93 Preliminary conclusion on SMP in Market A ............................................................... 94 SMP Designation in Market A ..................................................................................... 95 Assessment of SMP in Market B .................................................................... 95 Existing competition ................................................................................................... 97 4 Broadcasting Transmission Services in Ireland ComReg 20/31 Potential competition .................................................................................................. 97 Countervailing buying power ...................................................................................... 99 Preliminary conclusion on SMP in Market B ............................................................. 100 SMP Designation in Market B ................................................................................... 101 Overview ......................................................................................................... 102 Competition Problems – Market A ................................................................ 103 Types of Competition Problems ................................................................................ 103 Exploitative practices ...............................................................................................