The Department of Justice has issued a warning to the Academy of Motion Picture Arts and Sciences. The voting body of the Oscars could face potential legal problems if it opts to move forward with a new rule that limits the eligibility of Netflix and similar streaming services from the annual Academy Awards. Such a rule would likely raise antitrust concerns and therefore violate competition law.
Variety is reporting that they have come into possession of a letter from the chief of the DOJ’s Antitrust Division, Makan Delrahim, to AMPAS CEO Dawn Hudson on March 21st. In his letter, Makan Delrahim addresses the department’s concern on the issue:
“In the event that the Academy — an association that includes multiple competitors in its membership — establishes certain eligibility requirements for the Oscars that eliminate competition without procompetitive justification, such conduct may raise antitrust concerns.”
In his letter, Delrahim specifically cites Section 1 of the Sherman Act:
“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.”
“Accordingly, 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.”
The Academy has since responded to the DOJ’s letter, a spokesperson says:
“We’ve received a letter from the Dept. of Justice and have responded accordingly. The Academy’s Board of Governors will meet on April 23 for its annual awards rules meeting, where all branches submit possible updates for consideration.”
The DOJ’s warning comes after reports were floated around that Steven Spielberg had recently argued that Netflix films, as well as films produced by other streaming services, should be regarded as “made-for-tv” movies and thus qualify for the Emmy’s and not the Oscars, which recognizes achievements in theatrically released films.
What do you make of this news? Do you agree with Spielberg? Should Netflix films be up for Emmy’s instead of Oscars? And does excluding streaming services from the Academy Awards infringe on competition? Sound off in the comments below and let me know your thoughts?