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Justice Department Warns Academy Over Rule Change to Ban Netflix From Oscars

DOJ says proposed change hampering eligibility of Netflix, Amazon could violate antitrust rules

Alfonso Cuaron - Director, Orignal Screenplay and Cinematography - 'Roma'91st Annual Academy Awards, Press Room, Los Angeles, USA - 24 Feb 2019

The Justice Department said a proposed rule change to hinder the Oscar eligibility of streaming services could violate antitrust laws.

Andrew H. Walker/BEI/REX/Shutterstock

The Justice Department warned the Academy of Motion Picture Arts and Sciences in a letter that potential rule changes to hinder the Oscar eligibility of Netflix and other streaming services could violate antitrust and competition laws, Variety reports.

The letter follows reports that Steven Spielberg, an Academy board member, was preparing to propose a rule change that would prevent films that debut on streaming services or have limited theatrical releases from the Oscars. The chief of the DOJ’s Antitrust Division, Makan Delrahim, wrote in a letter to Academy CEO Dawn Hudson that doing so could “suppress competition.”

“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,” Delrahim said.

Delrahim said that a proposed rule change could violate the part of the Sherman Act that “prohibits anticompetitive agreements among competitors.” He continued, “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.”

An Academy spokesperson responded to Delrahim’s letter, saying, “We’ve received a letter from the Dept. of Justice and have responded accordingly. The Academy’s Board of Governors will meet on April 23rd for its annual awards rules meeting, where all branches submit possible updates for consideration.”

News of Spielberg’s proposed rule change broke after Netflix notched its biggest Oscars achievement to date, with Alfonso Cuarón’s Roma winning Best Director, Foreign Language Film and Cinematography. The streaming giant promptly responded on Twitter, declining to mention Spielberg by name, but writing, “We love cinema. Here are some things we also love. Access for people who can’t always afford, or live in towns without, theaters. Letting everyone, everywhere enjoy releases at the same time. Giving filmmakers more ways to share art. These things are not mutually exclusive.”

Spielberg has been a vocal critic of streaming services and their ongoing efforts to take over awards season well before his proposed rule change. In a 2018 interview with ITV News, he said, “Once you commit to a television format, you’re a TV movie. You certainly, if it’s a good show, deserve an Emmy, but not an Oscar.I don’t believe films that are just given token qualifications in a couple of theaters for less than a week should qualify for the Academy Award nomination.”

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