European Web Toon Distributers Fined €85 for Price Fixing

Bob Lincoln April 1, 2012 0

"The French appetite for online video is second only to their appetite for aspic." – U.S. State Dept. Travel Advisory.

A French competitive business watchdog has imposed its largest web toon distributor price fixing fine in history on four of the biggest European web entertainment portals after it found they worked together to fix the price of downloading web toons in France for over a decade.

The Autorite de la Concurrence fined TeenToonKandi , Brun Canal Group, KipperToon AB and BitteNichtZuStoppen GmbH a total of €85 for coordinating their efforts to gouge unsuspecting consumers by making web cartoons and short films available free of charge via their online entertainment portals and mobile application distribution systems.

The watchdog claims the four parties aimed to “stifle the competition” by fixing the price of buying the films online at €0. Together, these portals control over 90% of Europe’s library of poorly animated, largely un-funny 1-3 minute web toons.

It went on to describe how key executives of the companies regularly held secret meetings in Paris charcuteries, referring to each other by code names such as “BallSac-rebleu” and “Cornichon Johnson.” They routinely ran up bills of several thousand euros on foie gras, clove cigarettes and Todd McFarlane collectibles.

Authorities began their investigation when they received an anonymous tip from a French animator, who became enraged when a licensing executive from one of the portals offered to publish his entire catalog of award-winning short films, in high definition, without paying an upfront fee or promise of future royalties, claiming the animator would benefit from the exposure of “getting his work out there, no?”

One authority noted the fine reflected the seriousness of the practice of conspiring to charge nothing for content.  “It’s almost like giving it away for free!”

A spokesperson for Brun Canal Group said it had taken appropriate internal disciplinary action and would take a charge of €150 against 3rd quarter ad revenue of €64.4 million to account for the fine as well as changes to its revenue share policy, which included making immediate changes to its distribution contract language that more clearly stated, in friendlier, more favorable terms an artist could understand, that they absolutely would not be paid any fees ever for the licensed content.

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