Union takes up issues with laws

The European Union is challenging the legality of Italian TV laws passed by former prime minister Silvio Berlusconi.

The European Commission on Wednesday fired off a missive to Italo prime minister Romano Prodi — who defeated Berlusconi in April — questioning the current rules. Letter suggests the regs unfairly favor Berlusconi’s Mediaset and pubcaster RAI in the planned switch from analog to digital terrestrial TV and stifle potential competitors who could encroach on their present duopoly.

In a statement the commission said it is concerned existing legislation “attributes unjustified advantages to existing analog operators” and “may indeed preclude operators which are not active in analog transmissions from experimenting with digital transmissions and from creating their own digital networks.”

The EU said it is acting on a complaint from Italian consumer advocacy group Altroconsumo.

Italy has two months to reply to the EU challenge, which is expected to prompt TV law modifications by the ruling center-leftists. Given the government’s wafer-thin parliamentary majority, however, a radical legislative overhaul will be tough to pass.

Communications minister Paolo Gentiloni said Wednesday he will address the issues raised by the EU, adding he already intended to modify the law to allow “more pluralism and competition.”

There was no immediate comment from Mediaset.

Mediaset stock remained stable on the Milan Bourse following the EU announcement.

Gentiloni said at a recent media confab in Naples that he intends to postpone the planned date of the analog/digital switch from 2008 to 2012 in order to give potential players more time to develop the technology and content to be competitive.

Mediaset has invested a hefty E1.6 billion ($2 billion) in DTT, snapping up frequencies and launching a unique pay-per-view service that sells soccer games and movies to customers with a digital decoder and a card. About 4 million of Italy’s 22 million TV homes are DTT equipped.

The minister also is expected to lower the cap on the number of ads each web can sell and to restrict the frequencies big players can dispose of.

Last week, speaking at the Naples confab, Mediaset prexy Fedele Confalonieri had criticized the expected prospect that the EU could intervene.

“I see vultures flying around; the current TV law has been around for more than two years. Why now?” he said.

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