Bundeskartellamt currently sees no scope for joint TV marketing by RTL and RTL2

Over the past one and a half years the Bundeskartellamt has closely examined RTL’s proposal to also market the TV advertising space of RTL2. The authority has now informed the companies that it currently sees no scope for such cooperation.

Andreas Mundt, President of the Bundeskartellamt: “The world of media is changing. We therefore took a very close look at whether it could be acceptable in light of changing viewing habits that RTL and RTL2 cooperate in the marketing of advertising. This involved several rounds of in-depth market surveys in close exchange with the parties. The surveys showed that linear TV is still very strong in video advertising and that while new players such as Netflix, Amazon Prime or Disney are entering this field, their advertising activities so far are not important enough to exert considerable pressure on the placing of advertisements in linear TV. RTL2 currently continues to be an important alternative to the two leading providers RTL and ProSiebenSat.1. A marketing cooperation would lead to clear disadvantages for competition and most likely higher prices for advertising customers.”

RTL first asked the Bundeskartellamt to assess the cooperation project in summer 2023. After extensive investigations and a first critical feedback in October 2023, the parties informed the Bundeskartellamt that they would continue to pursue the project. The Bundeskartellamt continued its investigations, based on which it confirmed its critical assessment in spring 2024. As a response, the parties modified their cooperation project. Having conducted additional investigations, the Bundeskartellamt has now informed the parties that it upholds its negative assessment despite the modifications.

As a marketing cooperation between two close competitors of considerable market significance, RTL and RTL2’s project is expected to in particular lead to increased prices for the other market side. This is a clear disadvantage for competition which the investigations have not found to be sufficiently countered by advantages such as cost savings for the other market side to justify an exemption of the project from the ban on cartels.

The Bundeskartellamt’s assessment fully takes into account the current transformation of the media sector, including the use of digital media. However, the video advertising space available in digital media is comparable to the impact of TV advertising space only to a limited extent. Video advertising on streaming platforms such as those of Amazon, Netflix and Disney is fairly comparable; however, these are mainly paid-for services which are financed by advertising only on a supplementary basis. Accordingly, none of the relevant advertising offerings were found to be important enough to seriously challenge the strong position of the RTL Group in video advertising in the near future. As to the wide range of offerings on YouTube, the concrete advertising offerings have to be assessed individually. They mainly tend to be considered not to have an equivalent impact. As to video advertising on social media, this definitely serves different purposes.

To establish the facts necessary to assess the project, the Bundeskartellamt conducted thorough investigations. In autumn 2023 it surveyed in writing all major media agencies and 30 large advertisers and in spring 2024 it had extensive consultations with the five largest media agencies and all potentially relevant competitors in the TV and online segments. It also had additional consultations with market players on the modified project in 2024.

RTL is part of the Bertelsmann group, which with its subsidiary AdAlliance is a powerful provider of advertising space, also beyond the TV segment. RTL2 – despite what its name would suggest – is not a subsidiary of RTL or Bertelsmann but a joint venture owned by RTL and other players from the media sector. Consequently, agreements between RTL and RTL2 may violate the prohibition of anti-competitive agreements.

At the same time as examining the cooperation project between RTL and RTL2 in the advertising space marketing sector, the Bundeskartellamt in summer 2024 also examined a merger project between RTL and Paramount where RTL intended to take over the linear children’s TV offering Nickelodeon in Germany. Also in that proceeding the Bundeskartellamt had already broadened its focus beyond linear TV. After the Bundeskartellamt had informed RTL and Paramount that it intended to prohibit the planned merger due to the specific situation in the children’s TV segment, the parties withdrew their notification (see press release of 17 September 2024, in German).