BT and Sky "disappointed" by Ofcom pay TV probe findings

By Dave Bailey
31 Mar 2010 View Comments
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Regulator delivers boost to BT's IPTV offering

UK comms regulator Ofcom published its pay TV market probe conclusions today, forcing satellite broadcaster Sky to lower its main sports channels' pricing.

Although this would boost BT's IPTV offering, BT Vision, the incumbent telco said in a statement that Ofcom's decision was disappointing.

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BT Retail CEO Gavin Patterson said that Ofcom should have gone much further than it did. "They should have included the dropped movie channels, and all Sky Sports channels, not just two."

Patterson also pointed out that Ofcom did not set a regulated price for high-definition content channels.

Sky chief executive Jeremy Darroch was similarly disappointed with the Ofcom ruling, but for different reasons to Patterson. On a video on its web site, Darroch outlined his disappointment.

"We think Ofcom has got this badly wrong, the prices are fair for customers and fair for the companies we supply. We intend to appeal the ruling through the courts," said Darroch.

However, for IPTV providers such as BT, the decision gives them access to some of Sky's content at lower prices, which could boost the uptake of BT Vision.

The reasoning behind the regulator's decision was that Sky was exploiting its market power by "restricting the distribution of its premium channels to rival pay TV providers."

"This prevents fair and effective competition, reduces consumer choice and holds back innovation and investment by Sky’s rivals," said Ofcom.

Sky will be required to make a “reference offer” – a template contract to other pay TV providers – within six weeks of today’s announcement, explained Ofcom.

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