Market Analysis: Broadcasting Transmission Services in Ireland Market Review Broadcasting Transmission Services in Ireland Response to Consultation and Decision Notice Reference: ComReg 13/71 Decision: D11/13 Date: 26/07/2013 ComReg 13/71 Market Analysis: Broadcasting Transmission Services in Ireland Redacted Information Please note that this is a non-confidential version of the Response to Consultation and Decision. Certain information within the Response to Consultation and Decision has been redacted for reasons of confidentiality and commercial sensitivity, with such redactions indicated by the symbol . 1 ComReg 13/71 Market Analysis: Broadcasting Transmission Services in Ireland Contents 1 Introduction .................................................................................................. 3 Overview ............................................................................................................... 3 Previous Review of the Relevant BTS Markets .................................................... 6 Legal basis and regulatory framework .................................................................. 7 Consultation with the Competition Authority and the European Commission ....... 9 Approach to finalising its review of the Relevant BTS Markets ........................... 10 Structure of the Decision .................................................................................... 11 2 Executive Summary ................................................................................... 14 Overview ............................................................................................................. 14 Definition of the Relevant Markets and Competition Assessment ...................... 14 Imposition of Regulatory Obligations .................................................................. 15 3 Assessment of the Retail Market ............................................................... 19 Position set out in the BTS Consultation ............................................................. 19 Respondents‟ Views ........................................................................................... 29 ComReg‟s Assessment of Respondents‟ Views ................................................. 32 ComReg‟s Position ............................................................................................. 38 4 Wholesale Market Definition ...................................................................... 40 Preliminary Views set out in the BTS Consultation ............................................. 40 Respondents‟ Views ........................................................................................... 46 ComReg‟s Assessment of Respondents‟ Views ................................................. 49 ComReg‟s Overall Position ................................................................................. 65 5 Three Criteria Test – Market A .................................................................. 66 Position set out in the BTS Consultation ............................................................. 66 Respondents‟ Views ........................................................................................... 70 ComReg‟s Assessment of Respondents‟ Views ................................................. 72 6 Competition Analysis and Assessment of SMP – Market A ...................... 80 Position set out in the BTS Consultation ............................................................. 80 Respondents‟ Views ........................................................................................... 81 ComReg‟s Assessment of Respondents‟ Views ................................................. 83 7 Competition Problems – Market A ............................................................. 88 ComReg 13/71 Market Analysis: Broadcasting Transmission Services in Ireland Position set out in the BTS Consultation ............................................................. 88 Respondents‟ Views ........................................................................................... 89 ComReg‟s Assessment of Respondents‟ Views ................................................. 92 8 Remedies – Market A ................................................................................ 94 Imposition of Access Remedies .......................................................................... 95 Imposition of Non-Discrimination Remedies ..................................................... 108 Imposition of Transparency Remedies ............................................................. 113 Imposition of Accounting Separation Remedies ............................................... 123 Imposition of Price Control and Cost Accounting Remedies ............................. 135 9 Regulatory Impact Assessment – Market A ............................................ 162 Position set out in the BTS Consultation ........................................................... 162 Respondents‟ Views ......................................................................................... 164 ComReg‟s Assessment of Respondents‟ Views ............................................... 165 10 Decision Instrument – Market A .............................................................. 170 Position set out in the BTS Consultation ........................................................... 170 Respondents‟ Views ......................................................................................... 171 ComReg‟s Assessment of Respondents‟ Views ............................................... 173 11 Three Criteria Test – Market B ................................................................ 179 Position set out in the BTS Consultation ........................................................... 179 Respondents‟ Views ......................................................................................... 183 ComReg‟s Assessment of Respondents‟ Views ............................................... 186 12 Competition Analysis and Assessment of SMP – Market B .................... 203 Position set out in the BTS Consultation ........................................................... 203 Respondents‟ Views ......................................................................................... 204 ComReg‟s Assessment of Respondents‟ Views ............................................... 206 13 Competition Problems – Market B ........................................................... 209 Position set out in the BTS Consultation ........................................................... 209 Respondents‟ Views ......................................................................................... 210 ComReg‟s Assessment of Respondents‟ Views ............................................... 212 14 Remedies – Market B .............................................................................. 217 Imposition of Access Remedies ........................................................................ 218 1 ComReg 13/71 Market Analysis: Broadcasting Transmission Services in Ireland Imposition of Non-Discrimination Remedies ..................................................... 225 Imposition of Transparency Remedies ............................................................. 228 Imposition of Accounting Separation Remedies ............................................... 231 Imposition of Price Control and Cost Accounting Remedies ............................. 240 15 Regulatory Impact Assessment – Market B ............................................ 248 Position set out in the BTS Consultation ........................................................... 248 Respondents‟ Views ......................................................................................... 250 ComReg‟s Assessment of Respondents‟ Views ............................................... 250 16 Decision Instrument – Market B .............................................................. 254 Position set out in the BTS Consultation ........................................................... 254 Respondents‟ Views ......................................................................................... 255 ComReg‟s Assessment of Respondents‟ Views ............................................... 256 17 Next Steps ............................................................................................... 260 Appendix A Consultation with the Competition Authority ............................... 261 Appendix B European Commission Comments ............................................. 262 Appendix C Updated Retail Trends Analysis .................................................. 263 Appendix D Final Decision Instrument – Market A ......................................... 267 Appendix E Final Decision Instrument – Market B ......................................... 293 Appendix F Regulatory Impact Assessments ................................................. 315 Appendix G Glossary of Frequently Used Terms ........................................... 343 2 ComReg 13/71 Market Analysis: Broadcasting Transmission Services in Ireland 1 Introduction Overview 1.1 Wholesale broadcasting transmission and distribution services („BTS‟) essentially enable television („TV‟) programme service1 providers such as RTÉ, TV3 and TG4 („Downstream TV Broadcasters‟) and radio programme service providers such as RTÉ, Today FM and Newstalk („Downstream Radio Broadcasters‟), (together referred to as „Downstream Broadcasters‟)2, to broadcast their