Government threatens to ban Star Group from broadcasting

The Jakarta Post, Jakarta

The government is threatening to prevent international media company Star Group from broadcasting in Indonesia, even though the company has complied with the demands of the information and communications minister.

"We are considering imposing an injunction if Star Group continues to maintain unfair business practices," ministry spokesmen Gatot S. Dewa Broto told The Jakarta Post on Tuesday.

He said the proposed injunction related to Star Group's decision to cancel a contract with Indonesian pay TV distributor PT Indovision, a measure considered to be unfair business treatment and which dismayed many of the company's subscribers.

"They gave us only two days' notice before we lost all the stations," said Indovision subscriber "Ryan", who was particularly annoyed by the loss of sports programming.

Communications minister Sofyan Djalil accused the group of creating an unfair business competition by giving the distribution contracts of six popular channels -- Star Movie, Star World, Star Sport, ESPN, National Geographic, and (V) Channel exclusively to PT Direct Vision, another pay TV operator.

"From our perspective, the group has misused its dominant position by creating unfair business practices," he told a press conference earlier on Tuesday.

He added he had threatened to ban Star from airing its shows in Indonesia by Tuesday midnight and to order Direct Vision to halt any marketing activities if Star persisted with its decision.

Star Group announced Tuesday afternoon it had agreed to comply with the minister's requirements. Indovision will be allowed to broadcast the Star programs for another two months, while waiting for the Commission for the Supervision of Business Competition's (KPPU) verdict on whether Star Group's decision not to grant distribution contracts to a particular company had violated the 1999 Monopoly Law.

The president director of another TV distributor, Telkom Vision, denied that Star Group had acted in a monopolistic fashion, because his company had also received the broadcast rights to the six channels.

"We almost failed to get an extension contract, but after some lobbying we were successful," Udiyatno said, quoted on the news portal.

He said he was surprised by the minister's statement that the rights to the Star Group channels were only given to Direct Vision.

But he also said his company had obtained the extension contract with the assistance of Direct Vision.

Indovision's lawyer Juniver Girsang said the Star Group's decision not to extend the Indovision contract when it expired on April 30 was its reason for filing a complaint with KPPU.

He said the decision by Star not to extend the contract was aimed at benefiting a competing pay TV operator, although he did not specify the company in question.

The termination of the contract had caused the company to lose about US$1 billion in potential revenue from 120,000 residential and 17,000 hotel rooms subscribers, Juniver said.

"We sent a letter about a week ago to the minister, requesting his help in solving this case," said Juniver when asked about the ministry's response. "I think the minister would do the same thing if someone else reported a similar case."

KPPU member Mohammad Iqbal said the commission would scrutinize the report and follow it up with an investigation if there was any indication of a legal violation.(09)
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