9. november 2014

The Consumer Ombudsman views forced bundling (tying) of TV and Internet as illegal

Consumers that only wish to purchase Internet access from their cable providers are also forced to pay for TV access. The Consumer Ombudsman has now notified Norwegian cable providers Get and Canal Digital that this practice is viewed as illegal.

The Consumer Ombudsman views forced bundling (tying) of TV and Internet as illegal

Internet access is increasingly becoming a requirement for taking part in society. More and more consumers are replacing traditional linear TV watching with receiving news and entertainment through streaming and web TV.

But the offerings of cable providers have yet to reflect this development. Cable companies require consumers who want to sign up for Internet access to also pay for TV access from said company – a service consumers don’t necessarily want.

The Consumer Ombudsman has viewed the practice of forced bundling as in breach of the Norwegian Marketing Control Act § 22. The Ombudsman has now notified cable providers Canal Digital and Get that they must change the way they offer their services.

– Everybody needs Internet access in this day and age, but this is no longer the case for TV. Internet customers not being able to exclude the added cost of TV access from their purchase, is therefore unfair, says Consumer Ombudsman Gry Nergård.

Prevents consumers from shopping around

Illegal forced bundling has wide-ranging significance. A report from the Norwegian Post and Telecommunications Authority shows that 50 percent of consumers with high-speed broadband are using Cable Internet access. And the combined market share of cable providers Get and Canal Digital is close to 93 percent in the cable market.

Through forced bundling, the companies force consumers to buy TV access from one particular provider in order to receive Internet access. Should the consumer feel dissatisfied with the TV service provided, payment is still required, regardless of whether the consumer only wishes to stream TV via the web or wants to use a different provider for their TV needs.

– Canal Digital has signalled us that they are looking to cease their practice of forced bundling, which is a positive signal. But we will need to engage in talks with the company to clarify how and when this is to come into effect. On the other hand, Get has not signalled such a change, and we have therefore notified Get that they are also required to cease applying this illegal practice, says Consumer Ombudsman Gry Nergård.

Unfair and in breach of the law

During the autumn of 2013, the Consumer Ombudsman received a complaint regarding the forced bundling of TV access and Internet access. In light of changing consumer trends and the importance of battling illegal forced bundling, the Consumer Ombudsman has reviewed the complaint in accordance with the Norwegian Marketing Control Act.

Following a general assessment, the Consumer Ombudsman has concluded that the cable providers’ practice of forced bundling is in breach of the Norwegian Marketing Control Act.

The cable providers in question have previously claimed that delivering Internet access only, would be technically difficult and could lead to poorer services received by customers currently relying on analogue TV signals. The opinion of the Consumer Ombudsman, however, is that this reasoning does not justify the current requirement of consumers to buy TV access in order to gain Internet access from the same provider.

Get and Canal Digital have been given until December 3rd to respond to the conclusions of the Consumer Ombudsman.

Press contact at the Consumer Ombudsman:

Gry Nergård, Consumer Ombudsman (Tel: +47 99 00 50 80)