The European Commission has ruled that a French plan to subsidise digital music stores does not violate EU competition laws.
The French government wants to create a Carte Musique for 12- to 25-year olds, which would provide €50 of credit at online music stores, but only cost half that. The government will pay the balance direct to digital music providers.
Joaquin Almunia, Commission vice-president in charge of competition policy, said the measure is inline with EU rules allowing general interest goals. The measure is well designed to achieve its objective, is limited in time and scope and contains safeguards to limit potential distortions of competition, he said.
“We welcome initiatives from Member States to increase the availability of music online at a lower price for consumers and through legal distribution channels. Music online is certainly a driver for the success of the Internet and for economic development. However, we shall ensure that such initiatives are implemented in compliance with the EU state aid rules.”
Participants will be limited to one card per year and the French government expects to sell two million cards over the course of the scheme’s scheduled two years.
The aim is to develop the habit of buying music, rather than freely downloading it from nefarious sources. Music stores are expected to play their part, by cutting prices, extending the duration of music subscriptions it contributing to the cost of advertising the card.
Each music store and service will be able to claim up to €5 million in subsidies, a cap that is designed to ensure independent and niche operators are also able to benefit from the scheme.
