CCI Clears BookMyShow Of Abuse Of Dominance Allegations Despite Dominance In Online Movie Ticket Booking Market

The Competition Commission of India on Thursday cleared BookMyShow operator Big Tree Entertainment Pvt Ltd of abuse of dominance allegations, even as it held that the company enjoys a dominant position in the online movie ticket booking market in India.

A coram of Chairperson Ravneet Kaur and Members Anil Agrawal, Sweta Kakkad and Deepak Anurag closed the information filed by Vijay Gopal, founder of online movie ticketing portal Showtyme, registered in the name of Vanila Entertainments.

The Commission held, "The Commission is of the view that though the OP enjoys dominant position in the relevant market of 'market for online intermediation services for booking of movie tickets in India', however, no case of contravention of the provisions of Sections 4(2)(a)(i), 4(2)(b)(i) and 4(2)(c) of the Act is made out against the OP in the present matter. Accordingly, the matter is directed to be closed forthwith.”

The information alleged anti-competitive conduct by Big Tree Entertainment Pvt Ltd and several other cinema operators under Sections 3 and 4 of the Competition Act, 2002. The informant alleged that BookMyShow holds at least 90% market share in the movie ticket booking industry and charged high convenience fees while entering into “exclusive" and "refusal to deal” agreements with cinemas, coupled with “zero interest” monetary deposits, preventing them from partnering with similar platforms such as Showtyme. According to the informant, these arrangements created barriers for new platforms and led to increased ticket prices for consumers.

In its prima facie order, the Commission held that the allegations primarily concerned the conduct of BookMyShow and accordingly deleted the other opposite parties from the proceedings. It identified the relevant market as the “market for online intermediation services for booking of movie tickets in India” and directed the Director General to investigate the allegations of abuse of dominant position.

The Director General submitted the investigation report on November 23, 2023 in confidential and non-confidential versions and concluded that BookMyShow holds a dominant position in the relevant market. The DG also observed that certain practices such as differential revenue sharing and exclusive arrangements with cinemas were capable of restricting competition and denying market access to competing platforms.

BookMyShow, however, contended that it does not hold a dominant position in the relevant market and that its agreements with cinemas are commercially negotiated industry practices and do not deny market access to any competitor.

The Commission observed that BookMyShow entered the market at an early stage and has maintained its leadership position over several years. It noted that the company's wide reach, large user base, and network of cinema partners contribute to its strong position in the relevant market.

“On a cumulative assessment of the factors set out under Section 19(4) of the Act, including the OP's substantial and sustained market share, its scale of operations, network effects, economic strength and presence over time, the Commission concurs with the DG that the OP holds a dominant position in the 'market for online intermediation services for booking of movie tickets in India,'" the Commission held.

However, the Commission noted that such dominance is tempered by the presence of other players in the market and the reciprocal commercial dependence between BookMyShow and cinema operators.

On the allegations relating to reservation of a portion of seats, data ownership clauses, revenue sharing arrangements, and exclusive agreements with cinemas, the Commission found no abuse of dominance.

Accordingly, the information was closed.

For Opposite Party: Mr. Arun Kathpalia, Mr. Karan Singh Chandhiok, Mr. Yaman Verma, Mr. Avinash Amarnath, Mr. Harman Singh Sandhu and Ms. Pooja Mitra