Sky: 'Ofcom must back off'
February 6, 2009
BskyB followed up securing a further three years of live Premier League football with a vitriolic response to media regulator Ofcom's consultation on the UK pay-TV market, accusing it of “serious flaws” and “perverse conclusions.”
Responding to Ofcom’s second Consultation Document on pay TV which was published last September and said: "Retail competition that we see in pay TV as a result of limited distribution of premium content is likely to manifest itself in terms of reduced choice, reduced retail innovation, reduced platform innovation or higher prices.” It suggested Sky may have to be forced to sell channels wholesale to third parties and at fixed prices.
In its response Sky said that the regulator is "proposing the imposition of radical and highly interventionist regulation of a sort unseen in any developed market economy." It claimed the proposals "have the potential to introduce long-term distortions in the sector, resulting in significant economic costs and, ultimately, a worse outcome for consumers."
Sky alleges that Ofcom has failed to assess the UK pay-TV market properly and has rejected established competition law and practices. Sky denies it has restricted the supply of channels and says it has no incentive to restrict supply. On pricing it says that its offers are comparable with those of operators in other countries and that forcing it to sell channels to other parties on pre-set terms is asking Sky to subsidise competitors. The recommendations could also reduce competition for premium rights, Sky adds.
Sky's calls for Ofcom to 'step back' : "It is time for Ofcom to take a step back from the details of its Consultation Document and review its position with an open mind."