COMMISSION ENQUIRY INTO STATE FINANCING OF SWITCHOVER COSTS TO A DIGITAL TERRESTRIAL TELEVISION (DVB-T) PROJECT IN GERMANY
Brussels, 15 July 2004 - In order to promote the Dvb-project, the Media authority in Berlin-brandenburg has compensated private broadcasters for the so-called “switchover costs”. The private broadcasters were granted a subsidy in order to make them switch from analogue terrestrial to digital terrestrial television. The new terrestrial digital television network is operated by T-systems, a subsidiary of Deutsche Telekom Ag (Dtag). Triggered by a complaint, the Commission has examined this compensation. At this stage, the Commission feels that the compensation payments may amount to State aid, both to the private broadcasters as well as to T-systems, the operator of the Dvb-t network. The Commission has therefore decided to open a formal investigation procedure. The opening does not prejudice the final outcome of this investigation. The Media authority in Berlin-brandenburg promotes the introduction and development of digital terrestrial television (Dvb-t) in Berlin-brandenburg. In order to facilitate the switchover process, the media authority has awarded subsidies to the private broadcasters on condition that they use a T-systems’ network. This subsidy does not only seem to confer an advantage directly on the private broadcasters but indirectly on T-systems as well. The Commission’s main concern is the advantage granted to the latter. The intervention allows T-systems to launch its new service while it does not have to charge the broadcasters at a rate that covers the entire investment costs. Since Dvb-t is a technology which competes with digital television by cable (Dvb-c) or by satellite (Dvb-s) the intervention might distort the level playing field to the detriment of cable and satellite operators. Deutsche Telekom Ag (Dtag) obtained the Dvb-t frequencies after a call for tender. As an owner of the frequencies Dtag was obliged to construct and to exploit the Dvb-t network, a task undertaken by its subsidiary T-systems. The broadcasters pay a fee to T-systems which transmits their Tv signal over the Dvb-t network to the end-user.
