Trump’s enforcers seem to be gluttons for legal embarrassment.
By The Editorial Board, WSJ
The Justice Department’s antitrust avengers are back. After losing its appeal to block the AT&T -Time Warner merger, the government is now taking on the Hollywood cartel known as the Oscars in the name of protecting little guys like Netflix and Amazon.
Ever daring to lose a case, Antitrust Division chief Makan Delrahim is threatening the Academy of Motion Picture Arts and Sciences with antitrust action over a mooted Oscar rule change. Some Academy members like Steven Spielberg want to exclude films that can be streamed online at the same time they play on the big screen.
“If the Academy adopts a new rule to exclude certain types of films, such as films distributed via online streaming services, from eligibility for the Oscars, and that exclusion tends to diminish the excluded films’ sales, that rule could therefore violate Section 1” of the Sherman Antitrust Act, Mr. Delrahim wrote in a letter. He added that “agreements among competitors to exclude new competitors can violate the antitrust laws when their purpose or effect is to impede competition by goods or services that consumers purchase and enjoy but which threaten the profits of incumbent firms.”
Where to begin? Section 1 prohibits collusion that restricts competition, but the Academy—not to be confused with the Motion Picture Association of America—isn’t a trade group. The Oscars organization includes actors, directors, cinematographers and other artists who work for companies across the entertainment industry including Netflix.
Mr. Spielberg believes movies that don’t debut on the big screen should be considered for Emmy awards rather than Oscars. But this is a subject of debate in Hollywood, and people in the industry have conflicting views about streaming services. As actress Helen Mirren quipped last week, “I love Netflix. But—Netflix.”
Bypassing theaters reduces distribution costs, so more money flows to filmmakers. Streaming also increases exposure. With 139 million subscribers, Netflix wooed such A-listers as Kevin Costner and Martin Scorsese. Netflix estimated its film “Bird Box” starring Sandra Bullock was viewed by 80 million members during its first four weeks, which is more than theater ticket sales for all but 23 films in history.