In an unprecedented move, more than sixty of Italy's top film directors, writers and producers have addressed a fiery open letter to Giuseppe Tesauro, president of Italy's Antitrust Authority in leading Italian daily La Repubblica, denouncing the fact that none of Italy's film associations have been consulted over the planned merger of the country's beleaguered pay-TV platforms and premier film financiers, Stream and Telepiu.
Instead, Enzo Porcelli, co-head of Italy's Association of Independent Producers (API), said that only Medusa Film, the film company owned by Italian prime minister Silvio Berlusconi, and US distributors based in Italy, such as UIP, Buena Vista, Columbia Tristar and 20th Century Fox, had been consulted as representatives of the local industry.
"None of the Italian film associations [such as API or national film body Anica] have been consulted. It's just ludicrous. The merger affects the entire Italian film industry. It's in the public domain that the only companies that have been consulted are Medusa and US companies. Why not just ask [MPAA president] Jack Valenti for an opinion on the merger, and not bother asking anyone else'"
As news of Medusa's involvement in discussions and the exclusion of the Italian associations was expected to add more fuel to the ongoing debate over the potential conflict of interest between Berlusconi's position in government and his extensive business interests, Porcelli emphasized that the local film community is not opposing the merger itself.
Rather, he said, the local industry wants a guarantee that pay-TV investment in film will be increased if the merger goes through, not reduced. Telepiu, in particular, is one of the key Italian financiers of film, and invests more than $42.1m (90 billion lire) each year in the local movie industry.
In September, despite widespread industry confidence that the merger would receive swift regulatory approval, the Antitrust Authority opened an investigation into the deal which had been agreed by the pay-TV groups' parent companies, News Corp and Vivendi Universal to curtail massive financial losses and create a major single pay-TV entity in Italy.
As part of the agreement, News Corp is set to sell to Vivendi 50% of its stake in Stream, which was previously owned by Telecom Italia. Telepiu shareholders (Canal Plus Group and RAI) will own 75% of the new platform, with News Corp owning the other 25%.
The Authority is expected to evaluate the impact of the planned merger on what is, to date, the pay TV market's core and most lucrative investment - television soccer rights - while also examining the potential effects of the merger on movie rights and the potential "position of monopoly" of Canal Plus in Italy.
It is expected to announce its decision on December 12th or 13th.
Meanwhile, Roberto Benigni, Nanni Moretti, Gabriele Salvatores, Marco Bellocchio, Francesca Archibugi, Ferzan Ozpetek, Leo Pescarolo, Roberto Cicutto, Andrea Occhipinti, and Domenico Procacci were among the high-profile directors, producers and writers who added their signatures to the letter, which stated:
"After a long crisis, Italian cinema is now witnessing a revival, which is evident in the quality of films, the success of pictures at the box-office, victories in film festivals and the renewed interest of the international market. ['] Italian cinema gives so much to pay-TV, and at the same time it absolutely needs its support, on an equal footing with other European film industries - and in particular the French film industry. [']
"The Italian pay-TV market and Italian film industry are inextricably linked. [...] It is therefore inappropriate that no representative of any Italian film association should participate in any of the discussions over the merger which are presided by the Antitrust Authority. We trust that the Authority will act in line with European authorities, and will therefore agree to meet us as soon as possible."