Competition Policies and Consumer Welfare

Competition Policies and Consumer Welfare

Corporate Strategies and Consumer Prices in Developing Countries

Edited by Lahcen Achy and Susan Joekes

The fundamental goal of competition law is to support productivity and innovativeness; in fact, the short-term effect of enforcement actions is often a reduction in product prices. This book reports the findings of consumer market studies into a range of goods and services in developing countries in Africa, Asia and Latin America. It finds a pervasive lack of competition in those markets, which not only reduces the standard of living of consumers, including poor and vulnerable groups, but also softens the incentives on firms to improve the efficiency of their operations and the quality of their products

Chapter 9: TV distribution services in Argentina

Germán Coloma, Federico Bekerman, Cecilia Castets and Marcelo D’Amore

Subjects: development studies, development economics, law and development, economics and finance, competition policy, political economy, law - academic, competition and antitrust law

Extract

Between 1996 and 2006, progress in technology together with the convergence of networks, devices and services blurred boundaries inside the Argentinean TV industry and changed the way consumers accessed audio-visual content. The design of regulations and implementation of competition law underwent changes to reflect this. This chapter reviews the major cases dealt with by the Argentinean competition authority in the early 2000s and sheds light on the complexity of the television distribution sector. It provides lessons on the interactions between market structure, regulations and technology on the one hand and their impact on consumers’ access and the pricing of audio-visual services on the other hand. The distribution of television programmes in Argentina, as in other countries, takes place via free-to-air and pay-television using cable as well as satellite technologies. The sector involves a range of actors, among which are: ● TV channels (free-to-air or accessed via pay-TV systems). ● Pay-TV system operators (cable, satellite and terrestrial). ● Companies that supply TV channels to the pay-TV operators. ● Companies that produce television content and supply it to TV channels. Those actors relate to each other through various forms and degrees of economic integration. There are cases of vertical and horizontal integration between content producers and television channels, between cable television operators and marketing firms, and between channels owned directly by cable television operators. In this complex environment, defining the relevant market is difficult for any study of the sector from a competition policy perspective.

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