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Sky challenges Ofcom proposals
Monday 21st September 2009, by Daniel King
Sky has challenged recent proposals put forward by the telecommunications and broadcasting watchdog Ofcom that could have a significant effect on the number of people switching their broadband provider.
Currently, one of the latter company's selling points is the ability to offer a wide selection of channels through its own set-top boxes, but it also leases out these offerings to other providers at a fixed price.
Ofcom has suggested these premium sports and movie channels be supplied to such third parties at a reduced rate, as noted in a consultation document to accompany a recent pay TV market investigation.
However, Sky said the intervention of the regulator is an "extreme and unprecedented" move, adding it has not been found to be in any breach of competition law that justifies the action.
It was also advised current processes for making these channels available through its rivals' platforms were in place for the good of the customer and pursuing the changes would be illegal.
"While Ofcom acknowledges that its proposals go far beyond what would be required under competition law, it fails to recognise that
such a departure from orthodox competition law principles renders its proposed intervention unlawful," Sky explained.
The firm also said the introduction of a reduced, more regulated way for Sky to price such products would "send an extremely negative message about the UK as a place to invest" and would ultimately mean the consumer gets a poorer deal.
Currently, the group allows channels including Sky Sports news to be viewed across a number of platforms including Freeview. However, options like Sky Movies HD may tempt broadband shoppers to opt for a bundled web, telephone and entertainment package from the firm.
