Digital on-demand movie service Intertainer has filed an
antitrust lawsuit against AOL Time Warner, Vivendi Universal and
Sony, accusing them of “conspiracy to fix prices in the digital
distribution of entertainment,” and of inhibiting competition “by
engaging in a group boycott of intellectual property rights to
Intertainer.”
The lawsuit, filed in the US District Court for the Central
District of California, claims that the three entertainment giants
control 56% of the motion picture market and 63% of the music
market. It alleges that they conspired to break contracts and to
demand higher licensing fees from Intertainer so that they “have
the opportunity to deploy “ their rival Movielink service for
movies on-demand “that would monopolise” the market.
According to the Associated Press, Sony is one of Intertainer's
investors. The lawsuit claims that Sony, which also developed the
technology behind Movielink, "induced former employees of
Intertainer to violate their confidential knowledge of
[Intertainer's] proprietary technology" to build Movielink.
Intertainer, a joint venture of five studios to distribute films
over the internet to consumers with broadband connections, is
required to pay licensing fees to major studios in order to offer
their movies to subscribers.
Movielink has already been subject to a routine antitrust
investigation by the US Department of Justice.
