FT Profile is referred to monopolies commission: Database has copyright advantage over competitors

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The Independent Online
FT PROFILE, the on-line database with information ranging from national newspaper and magazine articles to Mintel market research reports, was yesterday referred to the Monopolies and Mergers Commission. The move was described by Financial Times Group, owner of the database, as 'unnecessary and unjustified by the facts'.

FT Profile, whose turnover was pounds 12m last year, is the only historical on-line database in the UK licensed to include every up-to-date article from the Financial Times.

The Office of Fair Trading said other UK databases were being forced to compete without important information contained in the Financial Times because of its copyright licensing policy.

'Information is an increasingly important business tool; this is reflected in the premium that users are prepared to pay for speedy access to it,' said Sir Bryan Carsberg, director-general of the OFT. 'The market for it is likely to grow in importance.'

The world market for such databases, including services such as news wires, has an estimated value of dollars 10bn.

Sir Bryan acknowledged that ownership of copyright gave an inherent monopoly advantage but said he was concerned that restrictions on copyright material may inhibit effective competition and put new players in the on-line database market at a disadvantage.

Jerry Roest, commercial director for Financial Times Information Services, said FT Profile had spent the past 10 years fighting its way into the international market and was only just achieving profitability.

'It seems that if the market is defined as being just on-line databases and if we look simply at UK newspapers, then Profile does have a very large chunk of the market,' he said.

'But we estimate the total UK market for electronic text retrieval of archive material at pounds 700m. Our US- based competitors have revenues of several hundred million dollars.'

'Unfortunately UK competition legislation requires the OFT to take a narrow and exclusively UK-centred view of the market and prevents it taking wider commercial and public interest considerations into account.'

(Photograph omitted)

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