<div>The Competition Commission of India has penalised the Karnataka Film Chamber of Commerce (KFCC), the Karnataka Television Association (KTVA) and the Kannada Film Producers’ Association (KFPA) for their involvement “in activities that restricted the telecast of content in the form of television programmes and films of some other languages dubbed into Kannada language.”<br /><br />The KFCC tried to defend itself by arguing that its byelaws did not “contain any restriction on other language films or programmes” and that it did not have the capacity to enforce restriction in the whole of Karnataka. It claimed that its membership was limited to Mysore-Karnataka and less than two-fifths of the single screen theatre owners were its members. <br /><br />The KFCC also argued that dubbing resulted in “the loss of opportunity for local artistes.” The Commission rejected the KFCC’s defence and observed that trade associations “cannot become the self-appointed guardians of local language and culture and interfere with the market forces.”<br /><br />Prima facie the order seems unobjectionable. The KFCC’s cultural/linguistic policing limits individual choice and facilitates the pursuit of commercial objectives in the name of defending Kannada. But we need to question the sanctity accorded to market competition and individual consumer choice by the Commission and ask if every sphere of human activity has to conform to the allegedly welfare and freedom/choice enhancing market norms. <br /><br />At the outset, one has to concede that there are cases related to the entertainment industry over which the Commission has indisputable jurisdiction. For example, cases of misuse of dominant position by certain producers to limit the screens available to their competitors belonging to the same language group. <br /><br />But, in the present case, and also in related cases decided in the past, the Commission’s order suffers from a major flaw. The order examines neither the nature of products of the entertainment industry, nor the relationship between the entertainment industry and other spheres of society, which would have helped decide if the Commission’s jurisdiction extended to the KFCC case.<br /><br />Four objections limit the Commission’s jurisdiction. First, the Commission assumes that economic efficiency should be the guiding principle in this case. But language preservation and economic efficiency are incommensurable objectives. As a regulatory body, the Commission is incompetent to choose between the two. In fact, by imposing its choice, the Commission has stepped into the domain of the legislature.<br /><br />Second, the Commission does not have the know-how to assess the non-market consequences of unchecked competition in the entertainment industry. In fact, the Commission does not even care to list the possible interrelationships between entertainment industry and the other spheres of society, let alone analyse how the latter might be affected by the decline of a language in the entertainment industry. <br /><br />There is a need to understand how the survival of a language, which is already marginalised in schools and job markets, is affected when it is also pushed out of the sphere of entertainment. Also, a proper analysis of the relationship between the use of a language in the film industry and the vitality of its literature and print media is needed before we can abandon the future of a language to market forces.<br /><br />Third, the Commission’s assessment is driven by mainstream economics whose theoretical apparatus is inadequate to deal with products such as films that should be treated as singular goods. Incommensurability and the absence of impersonal grounds for judging quality, differentiate singular goods and services such as paintings, wines, movies, music, and counselling from usual market products studied by economics.<br /><br />Moreover, economics suggests that individual choice should be governed by efficiency considerations whereas in markets for singular goods, individuals attach greater importance to aesthetic, ethical, cultural, religious, and other values.<br /><br />Fourth, languages evolve organically over a long period. So, once a language ceases to be used in a domain, it is not easy to revive it when we need it again. <br /><br />Statistical comparison<br /><br />Languages are unlike typewriters that were easily resurrected after WikiLeaks. But mainstream economics that guides the Commission is not designed to deal with the possibility of irreversible changes. Even if we ignore the above concerns, the order is questionable as it rests upon metaphors borrowed from market economics rather than a proper economic analysis. A proper analysis would have addressed the following concerns. First, there is a need for statistical comparison between output and employment in film industries over the years in different states grouped according to the level of state patronage for local language and the degree of entry barriers for cultural products of other languages. Second, a proper analysis needs to account for the fact that the film industries of more widely-spoken or commercially-developed languages enjoy cost advantages that can help them overwhelm competitors and establish a monopoly. <br /><br />Third, any assessment of cost and benefit analysis of entry barriers for non-local films needs to take into account both the short-term individual consumer welfare and economic efficiency as well as long-term community welfare. The Commission overlooks the fact that if the entertainment industry of a smaller language is allowed to decay, the loss could be irreversible and its consequences more widely distributed in the society compared to when an uncompetitive manufacturer of cement goes out of business.<br /><br />To conclude, while bans on dubbed films are illegal and might not solve the problems facing regional film industries, cases related to the entertainment industry lie beyond the Commission’s jurisdiction insofar as they involve questions related to the domains of language and culture. <br /><br />Unlike its counterparts in largely monolingual countries, the Commission should recognise the problems peculiar to India’s multilingual setting and identify the limits to the applicability of competition laws to the entertainment industry.<br /><br />(The writer is Assistant Professor of Econo-mics, Azim Premji University, Bengaluru)<br /><br /></div>
<div>The Competition Commission of India has penalised the Karnataka Film Chamber of Commerce (KFCC), the Karnataka Television Association (KTVA) and the Kannada Film Producers’ Association (KFPA) for their involvement “in activities that restricted the telecast of content in the form of television programmes and films of some other languages dubbed into Kannada language.”<br /><br />The KFCC tried to defend itself by arguing that its byelaws did not “contain any restriction on other language films or programmes” and that it did not have the capacity to enforce restriction in the whole of Karnataka. It claimed that its membership was limited to Mysore-Karnataka and less than two-fifths of the single screen theatre owners were its members. <br /><br />The KFCC also argued that dubbing resulted in “the loss of opportunity for local artistes.” The Commission rejected the KFCC’s defence and observed that trade associations “cannot become the self-appointed guardians of local language and culture and interfere with the market forces.”<br /><br />Prima facie the order seems unobjectionable. The KFCC’s cultural/linguistic policing limits individual choice and facilitates the pursuit of commercial objectives in the name of defending Kannada. But we need to question the sanctity accorded to market competition and individual consumer choice by the Commission and ask if every sphere of human activity has to conform to the allegedly welfare and freedom/choice enhancing market norms. <br /><br />At the outset, one has to concede that there are cases related to the entertainment industry over which the Commission has indisputable jurisdiction. For example, cases of misuse of dominant position by certain producers to limit the screens available to their competitors belonging to the same language group. <br /><br />But, in the present case, and also in related cases decided in the past, the Commission’s order suffers from a major flaw. The order examines neither the nature of products of the entertainment industry, nor the relationship between the entertainment industry and other spheres of society, which would have helped decide if the Commission’s jurisdiction extended to the KFCC case.<br /><br />Four objections limit the Commission’s jurisdiction. First, the Commission assumes that economic efficiency should be the guiding principle in this case. But language preservation and economic efficiency are incommensurable objectives. As a regulatory body, the Commission is incompetent to choose between the two. In fact, by imposing its choice, the Commission has stepped into the domain of the legislature.<br /><br />Second, the Commission does not have the know-how to assess the non-market consequences of unchecked competition in the entertainment industry. In fact, the Commission does not even care to list the possible interrelationships between entertainment industry and the other spheres of society, let alone analyse how the latter might be affected by the decline of a language in the entertainment industry. <br /><br />There is a need to understand how the survival of a language, which is already marginalised in schools and job markets, is affected when it is also pushed out of the sphere of entertainment. Also, a proper analysis of the relationship between the use of a language in the film industry and the vitality of its literature and print media is needed before we can abandon the future of a language to market forces.<br /><br />Third, the Commission’s assessment is driven by mainstream economics whose theoretical apparatus is inadequate to deal with products such as films that should be treated as singular goods. Incommensurability and the absence of impersonal grounds for judging quality, differentiate singular goods and services such as paintings, wines, movies, music, and counselling from usual market products studied by economics.<br /><br />Moreover, economics suggests that individual choice should be governed by efficiency considerations whereas in markets for singular goods, individuals attach greater importance to aesthetic, ethical, cultural, religious, and other values.<br /><br />Fourth, languages evolve organically over a long period. So, once a language ceases to be used in a domain, it is not easy to revive it when we need it again. <br /><br />Statistical comparison<br /><br />Languages are unlike typewriters that were easily resurrected after WikiLeaks. But mainstream economics that guides the Commission is not designed to deal with the possibility of irreversible changes. Even if we ignore the above concerns, the order is questionable as it rests upon metaphors borrowed from market economics rather than a proper economic analysis. A proper analysis would have addressed the following concerns. First, there is a need for statistical comparison between output and employment in film industries over the years in different states grouped according to the level of state patronage for local language and the degree of entry barriers for cultural products of other languages. Second, a proper analysis needs to account for the fact that the film industries of more widely-spoken or commercially-developed languages enjoy cost advantages that can help them overwhelm competitors and establish a monopoly. <br /><br />Third, any assessment of cost and benefit analysis of entry barriers for non-local films needs to take into account both the short-term individual consumer welfare and economic efficiency as well as long-term community welfare. The Commission overlooks the fact that if the entertainment industry of a smaller language is allowed to decay, the loss could be irreversible and its consequences more widely distributed in the society compared to when an uncompetitive manufacturer of cement goes out of business.<br /><br />To conclude, while bans on dubbed films are illegal and might not solve the problems facing regional film industries, cases related to the entertainment industry lie beyond the Commission’s jurisdiction insofar as they involve questions related to the domains of language and culture. <br /><br />Unlike its counterparts in largely monolingual countries, the Commission should recognise the problems peculiar to India’s multilingual setting and identify the limits to the applicability of competition laws to the entertainment industry.<br /><br />(The writer is Assistant Professor of Econo-mics, Azim Premji University, Bengaluru)<br /><br /></div>
