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The public sector comprises two broadcasters, ARD and ZDF. ARD transmits a national channel known as “Das Erste”
(First Channel). It consists of nine independent regional broadcasters under state law and “Deutsche Welle”, a state owned
broadcasting service for foreign countries. Germany’s other national public television broadcaster is ZDF, “Zweites
Deutsches Fernsehen” (Second Channel). ZDF is an independent non-profit corporation under the authority of the sixteen
German Federal States (Bundesländer), which transmits the national signal of ZDF.
The regional broadcasting corporations belonging to ARD form seven regional television channels, for historical
reasons collectively known as “Dritte Programme” (Third Channels). These channels carry programming tailored for their
respective regions in Germany, which may be broadcasted to other regions via cable, satellite and terrestrial, but are not
allowed to broadcast any commercials. These channels include Hessen Fernsehen, WDR Fernsehen, Bayerisches Fernsehen,
MDR Fernsehen, RBB Fernsehen, NDR Fernsehen (from NDR and Radio Bremen), and Südwest Fernsehen (from SR and
SWR).
ARD and ZDF also jointly operate a number of television channels. ARD and ZDF operate Phoenix (a public affairs
and documentary channel) and Ki.Ka (a children’s channel formerly called Kinderkanal), both of which launched in 1997.
ARD and ZDF are also involved in the pan-regional channels Arte and 3sat. German TV is an overseas pay-TV project of
ZDF, ARD and Deutsche Welle, available in the USA and Canada.
The commercial broadcasters. The commercial television sector is mainly financed by advertising revenues. The
commercial broadcasters’ ability to generate advertising revenues is affected by regulatory restrictions which are more lenient
than those applied to the public broadcasters. The commercial broadcasters are allowed to air advertisements 24 hours a day,
7 days a week, but are limited to up to 15% of total airtime per day and 20% per hour. Total revenues derived by the
commercial broadcasters from advertising sales in 2003 amounted to approximately €3.8 billion.
The commercial sector is dominated by two groups of broadcasters, the RTL Group and the ProSiebenSat.1 group. The
RTL Group is 90.4% owned by Bertelsmann, and the remaining 9.6% is publicly held. Its German channels are RTL, RTL 2,
Vox, Super RTL, n-tv and RTL Shop. The RTL Group’s channels attracted 32.9% of viewing and 44.2% of television
advertising revenues in 2004. The RTL Group generated approximately €4.9 million of revenues in 2004.
ProSiebenSat.1 is currently controlled by an investor group (holding 50.5%) led by Haim Saban, which also includes
Bain Capital, Hellmann & Friedman, Thomas H. Lee, Providence Equity Partners and the Quadrangle Group. Axel Springer
AG, one of the major German media enterprises, holds 12.0%, and the remaining 37.5% is publicly held. ProSiebenSat.1 has
four principal channels: Sat.1, ProSieben, Kabel1 and N24 (ProSiebenSat.1 has recently entered into an agreement to acquire
9Live, a call-in quiz show format that does not rely on advertising). ProSiebenSat.1 channels attracted 29.4% of viewing and
42.5% of television advertising revenues in 2004. ProSiebenSat.1 generated approximately €1.8 million of revenue in 2004.
In addition, there are approximately 25 other small, independent and privately owned channels operating nationally in
Germany. These include foreign channels such as MTV and German channels not belonging to the two main broadcaster
groups. Analog bandwidth limitations and the delayed roll-out of premium cable television services have inhibited the
carriage of all of these independent channels.
Media regulation. For details of the regulatory framework governing the allocation and use of analog transmission
capacities, in particular with regards to the role of the state media authorities, see “Regulation—Media Regulation”.
Premium Cable Television
Premiere is the dominant German-language premium cable television operator in Germany. Premiere broadcasts more
than 200 movie television premieres annually under exclusive, long-term contracts with eight major Hollywood studios.
Premiere offers its subscribers a variety of program packages at fees ranging between €5.00 and €43.00 depending upon the
package. Through an agreement with MSG, the Level 3 operators are obliged to carry 5 digital channels for Premiere (which
can be multiplexed into many more program streams) through 2007. It nevertheless maintains direct contractual relationships
with its subscribers who pay subscription fees directly to Premiere, while Premiere pays carriage and transponder leasing fees
to cable network and satellite operators, respectively.
Premiere currently has approximately 3.25 million subscribers and generated €984.8 million in revenues in 2004, 83%
of which was from program subscriptions and 10% from pay-per-view (PPV) fees and rental and sales of hardware. Like the
public and commercial broadcasters, Premiere also pays carriage fees to cable and satellite providers for transmitting its
signal to the end-customer. In 2004, Premiere incurred transmission costs of €101.2 million, or 10% of its total revenues.
Cable network operators have in recent years entered the premium cable television market. ish has launched a modular
premium cable television offering (“ish Digital TV”), KDG offers a premium cable television package branded “Kabel
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