New Italian PM Aims to Loosen Berlusconi''s TV Grip

17 May 2006

Italian prime minister Romano Prodi - elected last month by a hairsbreadth - is eyeing the nation's television duopoly, currently enjoyed by state broadcaster RAI (Radio Televisione Italiana) and Mediaset, the cross-media empire owned by his predecessor and political opponent Silvio Berlusconi.

Prodi, speaking to Advertising Age, told a reporter he intends to ask Italian antitrust officials to consider the best way to bring greater competition into the nation's TV market. It was not a political move, he assured AdAge: "This is not a vendetta. It is about what is best for the television sector."

"This is about fair competition," insists Prodi. "I have always said that in order to have a democracy you must have competition, and the Italian television sector is for all intents and purposes a duopoly - and it's practically a monopoly in terms of advertising."

Between them RAI and Mediaset control some 93% of all TV broadcast hours in Italy. The latter alone accounts for 55% of viewer hours and 66% of TV ad sales. "That cannot stand, though it will not be up to me how it is remedied," says Prodi.

Instead he will call on Italy's increasingly powerful antitrust authority - Autorità Garante Della Concorrenza e del Mercato - to propose a solution to the lack of competition in the TV sector. AGDCM officials declined to comment on the case when contacted, while Mediaset executives were likewise silent.

However, those who know Berlusconi harbor no illusion that Europe's most powerful media tycoon will remain inactive as the state slices large chunks from his media fiefdom.

Opines author and media sector analyst Antonio d'Aquilla: "Don't think Berlusconi is going to sit back and let a Prodi government unravel the crown jewel of [his] massive business empire. This would spark a pitched battle."

D'Aquilla posits three possible options for opening up the TV market:

  • RAI and Berlusconi each to be deprived of one network

  • Legislation to cap ad spending at any one network

  • Legislation to cap ad market share.
But media observers believe the most likely scenario to be the divestiture of one network each by Mediaset and RAI.

Data sourced from AdAge (USA); additional content by WARC staff