By Edith Hancock

Germany's competition regulator voiced concern about media company RTL Group's plan to take over the marketing of television ad space from TV channel RTL2, its joint venture with other media groups.

While the Bundeskartellamt hasn't made a formal decision on the deal, it said Wednesday that RTL and RTL2's proposed agreement could violate the country's antitrust rules, hurting competition in Germany's evolving TV advertising space and potentially leading to higher prices for advertisers.

Andreas Mundt, head of the German watchdog, said that newer platforms like Netflix and Amazon Prime have made inroads in advertising but still haven't evolved into rivals that can put lasting pressure on incumbents in the market. He said that RTL2 is still an important alternative to the two leading providers, RTL and ProSiebenSat.

"A marketing cooperation would lead to clear disadvantages for competition and very likely higher prices for advertisers," he said.

The German regulator started investigating the proposed deal last year, eventually prompting the two companies to modify their cooperation plan to ease competition concerns.

"The Federal Cartel Office has now informed the parties that the negative assessment continues despite the modifications," the watchdog said.

RTL Chief Executive Stephan Schmitter said the company couldn't understand the regulator's negative view. In a statement, he said the companies had already made what he described as considerable concessions to allay the watchdog's concerns and "pushed the limits of what is economically feasible for us."

"However, we once again found that the interpretation of competition law stands in the way of meaningful, necessary and, in this case, very limited cooperation between German media companies and does not reflect market realities," he said.

Write to Edith Hancock at edith.hancock@wsj.com

(END) Dow Jones Newswires

December 18, 2024 10:53 ET (15:53 GMT)

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