BookMyShow a dominant player but did not abuse its dominant position: CCI closes case

The Competition Commission of India (CCI) on Thursday held that Big Tree Entertainment, which operates the online movie ticketing platform BookMyShow, is a dominant player in the online movie ticket booking market but has not abused its dominant position under the Competition Act, 2002..The ruling came in a complaint filed by Vijay Gopal (informant), proprietor of Vanila Entertainments. Gopal runs an online ticket booking platform called Showtyme. He alleged that BookMyShow entered into exclusive agreements with cinemas and multiplex chains, preventing rival ticketing platforms from accessing the market. However, the CCI rejected this claim."The Commission is of the view that in the absence of any evidence to the contrary, the Commission is unable to come to a conclusion that the OP has abused its dominant position by imposing terms and conditions, which have the impact of foreclosing the market and denying market access to other players in contravention of the provisions of Section 4(2)(c) of the Act," the CCI held..According to the informant, BookMyShow also charged consumers a convenience fee for online bookings. A part of this fee was allegedly shared with cinemas. This, he claimed, discouraged theatres from partnering with competing platforms.The Commission examined whether these practices amounted to abuse of dominance under Section 4 of the Competition Act..The CCI first defined the relevant market.It agreed with the Director General (DG) that online ticket booking platforms operate in a market separate from offline box-office sales. The Commission noted that online platforms provide features such as seat comparison across theatres, digital payments, cancellation options and promotional offers. These services are not available at traditional ticket counters.The relevant market was therefore defined as the “market for online intermediation services for booking of movie tickets in India.".The Commission then examined whether BookMyShow was dominant in this market.It noted that the platform entered the market early and has built a large network of cinema partners and users.“The OP has maintained its leadership position in the relevant market over several years.The OP entered the market at an early stage and has, over time, built a wide network of cinema partners and a large consumer base,” the CCI noted..It also highlighted the scale of the platform’s operations and network effects created by its user base.Therefore, it concluded that BookMyShow holds a dominant position in the market for online intermediation services for booking of movie tickets in India. However, the CCI noted that the market remains dynamic and includes other players such as Paytm and Justickets."The market cannot be considered effectively foreclosed for new competitors. Also, the existence of other players like Paytm, Justickets and Amazon etc. in the said relevant market cannot be ignored," the Commission noted..The Commission rejected the allegation that reserving seats for the platform was anti-competitive.It accepted BookMyShow’s explanation that such arrangements help avoid overlapping bookings.It added that tickets reserved for the platform are later released for sale at the box office if they remain unsold..The Commission also rejected allegations relating to ownership of customer data.The DG had argued that different data-sharing arrangements between multiplex chains and single-screen cinemas were discriminatory.The Commission disagreed. It held that multiplexes and single-screen cinemas are not similarly placed entities.“In the present case, cinemas listed on the aggregator’s platform do not constitute a single, homogenous class. Single-screen cinemas and multiplexes differ materially in terms of infrastructure, ability to handle customer data securely, amenities, operational costs, and the overall quality of services offered,” the order said..The CCI also rejected allegations that BookMyShow imposed discriminatory revenue-sharing arrangements in relation to convenience fees.The Commission noted that these arrangements vary depending on commercial factors such as scale of business and negotiated contractual terms.It reiterated that the competition watchdog cannot act as a price regulator in such matters..The Commission also examined allegations that exclusive agreements with cinemas foreclosed the market for competing platforms.It found that the evidence did not establish substantial foreclosure.The order noted that the total number of exclusive arrangements was limited compared to the total number of cinema screens in India.In view of these findings, the CCI held that BookMyShow had not violated the abuse of dominance provisions under Section 4 of the Competition Act and closed the proceedings..BookMyShow was represented by Senior Advocate Arun Kathpalia with teams from Chandhiok & Mahajan (C&M) and Shardul Amarchand Mangaldas (SAM).C&M team comprised Advocates Karan Singh Chandhiok (Partner & Head of Competition & Regulatory Practice), Avinash Amarnath (Partner), Aakash Kumbhat (Managing Associate), Aileen Aditi Sundardas (Associate), and Jai Hindocha (Associate)..SAM team comprised Advocates Harman Singh Sandhu (Partner), Yaman Verma (Partner), Raveena Kumari Sethia (Principal Associate), and Pranika Goel (Associate)..[Read Judgment]