OFCOM investigates UK pay TV

At the request of BT, Setanta, Virgin Media and Top Up TV, OFCOM are to investigate the world of UK based pay television.



Whilst I am all in favour of an investigation, I do have my doubts as to whether anything will happen as a result. Ofcom have yet to take any deicisions that have real impact on the industry, and in pay TV, there needs to be something that has to happen.

You see, BSkyB is THE dominant force in UK pay TV , and it is the only one with national coverage across the UK. Virgin Media has a lot of coverage in the cities, but because of the prohibitive cost of cabling rural areas, has no coverage outside of the cities. Digital Terrestrial currently only has about 70% coverage, but that will grow as the analogue signals are switched off in the various areas until 2012.

Sky have already seen off two potential opponents in the pay TV market, first by merging with British Satellite Broadcasting (BSB) in November 1990, and second with the collapse of On/ITV Digital in March 2002. It's only with the recent-ish meger of the NTL and Telewest cable operations that cable has emerged as any kind of a powerhouse in the pay television arena, and it is still limited by the fact that not every house in the UK has a cable connection.

I would like to see Sky undergo some kind of limitation, possibly have them lose control of their EPG. After all, they cannot control who broadcasts on the satellites, as Sky do not own the satellites. The Satellites themselves are owned by a company called Societie European De Satellites, based in Luxembourg.

I would also like to see Sky denied permission to create a pay TV service on DTT. They want to have Sky One, Sky News, Sky Movies and Sky Sports, available on a subscription only basis on DTT, much in the same way that when they started on Astra 1A back in February 1989, they had Sky Channel, Sky News, Sky Movies and Eurosport (at the time they were a partner in the EuroSport operation, but left it after merging with BSB.)

Sky are like Microsoft, they are too dominant in the market, and do need to be reined in. Sky have behaved in a very anti-competitive way, in forcing all the channels in their package to accept much lower subscriber rates, including the Virgin Media channels, whilst at the same time, trying to force up the rates that Virgin Media pay for the Sky channels. If this isn't classic anti-competitiveness, I don't know what is.

I would like to see Ofcom actually do something about Sky, but I don't actually believe that Ofcom will do anything. Such a lack of action, in a market that actually demands it, would be postitively criminal.