Advanced Television

Sky fires back on BBC carriage

January 24, 2013

Sky will resist an attempt by the Government to stop it from charging £10 million (€12.3m) a year in fees to the BBC and other public service broadcasters to carry their channels on its services.

Ed Vaizey, the Culture Minister, said yesterday the fees should be dropped and hinted that the Government might legislate to remove them if Sky insisted on continuing to charge them. “We’re not going to rush into a regulatory solution because I believe there’s no reason the market should not be able to work out a fair, equitable solution. But if the industry cannot find a way to stop imposing this cost on licence feepayers and public service broadcasters, we will look at our options for intervention.”

Vaizey said he would give Sky 12 to 18 months to agree to drop the fees before he would consider intervening. He said neither side should pay any charges, ruling out suggestions from the BBC that Sky should pay public service broadcasters to carry their channels because the pay TV company’s customers spent so much time watching them.

Sky responded: “Public service broadcasters benefit from the billions of pounds we’ve invested in our TV platform, and the technical services we provide them. Thanks to Sky’s investment, they reach 40 per cent of their audiences via our platform and use our technology to customise channels and services for the benefit of their viewers. The payments they make are no different to paying for electricity, studio facilities or any other operational costs. We simply aim to recover our costs on a fair and proportionate basis.”

The fees have fallen sharply in recent years and will continue to fall. Sky received £16.7 million in 2011 and this year will collect £9.7 million. By 2014, the total fees will have fallen to just over £7 million.

This year, the BBC is paying Sky £6 million, ITV £2.1 million, Channel 4 £1 million and Channel 5 £0.5 million.


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