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Ofcom v Sky

Robert Peston | 08:09 UK time, Wednesday, 31 March 2010

Ofcom believes that millions of us make decisions on which TV service to buy and also which bundle of TV, broadband and telephony to purchase on the basis of whether we can get access to live sport and first-run Hollywood movies.

Sky TV remoteWhich is why it has concluded Sky derives an unfair advantage from its control of much of the top-rate live sport and films available in the UK.

The media watchdog has today ruled that Sky has to sell its sports channels to rivals at prices that are between 10.5% and 23% below the existing wholesale prices - and wants the Competition Commission to force the Hollywood studios to sell on-demand rights to movies to companies other than Sky.

Also Ofcom is forcing Sky to offer its HD sports channels to competitors, but isn't in this case setting the price - because it recognises that Sky must be able to benefit from the innovations it has made in this form of broadcast.

For Ofcom, the goal is to increase the availability of live sport so that, for example, it can be tapped by the millions who watch Freeview and in movies to see the development of on-demand services on broadband and other platforms.

Ofcom hopes that the likes of BT and Virgin will be able to offer competitive deals for packages of broadband, telephony and TV that includes sport, in a way that provides greater choice to consumers.

For Sky, Ofcom has made an unfair attack on its commercial freedom.

It will appeal against the decision, on the basis that the regulator has been out to get it in a way that is an unfair punishment of the risks it has been taking for 20 years in making substantial investments in sports and movie rights.

PS Please see my earlier post about Ofcom and Sky.

Comments

  • Comment number 1.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 2.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 3.

    I have absolutely no affinity or liking for Murdoch and his empire, however it seems to me that if Sky has bought these rights on the open market, then they should be their's to sell at whatever price they can get for them.

    Simple really - free enterprise in action!

  • Comment number 4.

    This is great news.
    I can't get Sky TV because of high trees in my neighbours garden which would stop a dish receiving the signal, but I can get freeview down my aerial. I will gladly pay for sky sports when it becomes available on terrestrial digital. Well done ofcom. As for less money going into sport, perhaps they shouldn't pay footballers £130,000 a week. Such wages are an affront to common sense.

  • Comment number 5.

    I look forward to Sky moving their Premier League coverage to Sky Sports 3 and 4 from next season.

    Simples.

  • Comment number 6.


    Ofcom's judgement, if it based it on assumptions about sport and first run movies, is taking a very narrow view which in my opinion is wrong.

    We bought into Sky because terrestrial reception is virtually nil, there is no cable and freesat, which we did try, is just plain awful both in what it offers and its clunky operation.

    I have long wondered why Sky, which has given us appalling customer service, has a monopoly and why it was not referred to the competition commission when Sky merged.

    In rural situations Sky is sometimes the only option other than freesat. Where terrestrial reception is questionable or simply not watchable, there is no other option because there is no cable either.

    As far as the specific vertical market of sport is concerned, Sky paid for its exclusive license and therefore it is entitled to do what it likes with it.

    The financial impact of Sky not having the exclusive on Sport would reduce the amount Sky pays to the clubs, reduce the receipts for exclusive sports and have a knock-on effect on all those club budgets too and therefore on the gate price for tickets.



  • Comment number 7.

    If you want to move back to talking about banking, go to the blog dealing with it. This one is about Sky's wholesale prices and how a cut in costs are needed.

  • Comment number 8.

    Politicians turn to shrinking violets in the face of a media conglomerate like B Sky B and its owner News Corp. So whatever Ofcom comes up with might be quite valid but if it threatens News Corp's interests, Murdoch will doubtless start threatening our elected politicians and then they will back down? The line we will be fed is, "we don't want to stifle competition in the media.." (even though Sky has a sport monopoly?)

    Either we only have Sky to worship or we allow other serious contenders into the fray. Sky bangs on about how public service broadcasters offer too much content "for free," (and there's me thinking we paid a licence fee) and so need breaking up. Yet, (not surprisingly,) Sky doesn't seem to think its own monopoly position should be.....broken up as well!

  • Comment number 9.

    This is a joke. Sky have been innovating ever since they took over the rights to the premier league in 1992. It was a huge risk for Murdoch to plunge £117m into the inaugural premier league season. Due to the money that sky provides for the Premier League, we have seen the quality of football increase and the calibre of players coming to our shores. The same goes for cricket where Sky pumps money into grass roots cricket by showing giving it money for television rights. Look at our cycling team that has done so well at the olympics and recently has Team Sky admitted into the tour de france in its maiden season. these are the kind of ventures that sky embark on, to the benefit of english sport.
    All sport is available in a local boozer for the price of a pint of beer if you cannot afford the dish. This communist act is going to be a detriment to the whole of sport in the UK.

  • Comment number 10.

    @3

    The problem is that Sky owns both the content and the delivery method, so in effect have a dual monopoly (can only get EPL on sky sports, can only get Sky Sports on Sky if Murdoch decides he doesn't want to sell wholesale).

    If I were Sky (with my evil, capitalist hat on) I'd make the different Sky Sports channels each focus on a specific sport (the movie channels have already done this). By breaking it down to lots of different channels it would make it more difficult to regulate, at the cost of people ignoring sports channels they don't watch. Either that or keep switching sports between SS 1,2,3 and 4 (using the excuse of 'choice').

    The other problem with Sky is that your view of it changes massively depending on whether you've got it or not. If you subscribe to the sports channels the last thing you want to too much stuff going to ESPN, because then you'll have to pay extra. If you don't subscribe to Sky and can get ESPN as a pay channel you'll want as much stuff on there as possible. The danger is that by splitting up sport between paid channels you'll end up in a situation where you'll be paying two subscriptions to watch content you only had to pay one for before.

  • Comment number 11.

    If sky have to wholesale the sports packages cheaper to other providers then they will not recieve the same revenue to bid for the sports packages when they come around to tender again. I am sure most other providers pay the current rates so who will make up the shortfall that people like the Premier League or Indian Premier league cricket hold out for. I'm guessing the consumer!
    When Sky were told that they could not televise all of the Premier league matches a few years ago and the rights were packaged up tender out to other broadcasters (Setanta and now ESPN)to promote competition and benefit the consumer, the prices went up. It can not be competition unless 2 people offer the same thing, and that will never happen with sports rights. All that happened was that another provider had exclusive rights to those games and the consumer then needed 2 subscriptions to watch the same amount of football at twice the price as the season before.
    I have never heard any people complain about the sky packages only other providers, If consumers don't like it, then they dont pay for it. Let them bid for the rights when it comes around again and leave it at that before prices are driven up and sporting events undermined.

  • Comment number 12.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 13.

    We lost our aerial during a house rebuild a year or so ago, and four months later we put it back up again.

    We needn't have bothered!

    Terrestrial and Freeview are pretty bland, and Sky isn't a package we could or would justify on a cost basis.

    We have BT Broadband and find that generally we can get news and sport information 24 hrs a day, the only thing that we miss is live cricket, but that we can live without also.

    Until TV programming gets real about what it offers to the public, the whole debate over satellite/terrestrial TV rights passes right by most people and just doesn't register.

  • Comment number 14.

    myk,
    the only delivery message is NOT Sky. You can get Sky Sports on Virgin and TalkTalk (from my experience) and probably others.

  • Comment number 15.

    Sadly Ofcom are probably right as Sky is clearly in a dominant position. Sky's arguments are exactly the same as those made by the oil barons over 100 years ago when US brought in anti-trust legislation.

    The real quetion for Sky (and the great unknown) is whether cutting prices will generate enough additional customers to actually by revenue neutral (or even positive). If the result is revenue negative then sport in this country will suffer - not just football but rugby, cricket, darts etc. I wonder if Sky's contracts with the sports bodies allow them to change what they are paying due to change in regulation? If so then Sky will be re-writing the current deals and not waiting until those deals run out

  • Comment number 16.

    I do not care about the subtleties Murdoch is creating a dynasty for World domination and anything that slows this down is to be welcome. The operation of the so - called free market is always progressing to producing monopolies.

  • Comment number 17.

    It strikes me that the intellectual rigour and the almost child like grasp of economic theory prevalent in the average 6th form common room (showing my age) has infiltrated Ofcom re the Sky issue - they (sky) have been successful by taking a risk and has been discussed elsewhere in this thread at the forefront of some fantastic innovations in broadcasting. Can it get back to the big issues like why is my taxpayers money paying for Radion 1 and Radio 2, stations which cater for musical tastes which are more than adequately covered by the private sector when the BBC closes down 6 Music?

  • Comment number 18.

    if sky invested in both delivery and content they should be allowed to profit on their investment at whatever price it can get.

  • Comment number 19.

    Sky has the advantage of being our only satelite broadcaster. Why not fund the BBC to launch their own satelitte & compete with Sky.
    As for who owns the sports broadcast rights we should allow a free market place, but insist that national games are not restricted to any one broadcaster.

  • Comment number 20.

    > For Sky, Ofcom has made an unfair attack on its commercial freedom.

    Nowadays, we only grant "commercial freedom" to firms that operate in our best interests. Firms that operate against us get told to change, and quite rightly so.

    We, the public, are the important ones, and firms have to serve us as well as they can, or they can go and get lost. Sky did well, so thanks are due. But that's that. Now they have to find a new way to rip people off.

  • Comment number 21.

    No doubt, that those of us who choose to subscribe to Sky, will now have our subscriptions increased.

  • Comment number 22.

    @14

    "the only delivery message is NOT Sky. You can get Sky Sports on Virgin and TalkTalk (from my experience) and probably others."

    They have pulled content in the past when they felt they weren't getting the rates they wanted. Also, Virgin itself isn't an option for a large percentage of the population who can't get cable, and internet based services require a good internet connection.

  • Comment number 23.

    Sky has good technology and a wide portfolio of programmes, sport and movies. All this at a price for little more than many would spend on quality newspapers throughout the month. Sky doesn't feature high on my list of things that I would like to put right.

  • Comment number 24.

    Well done,OFCOM.This is a commercial monopoly which needed to be broken. Particularly when SPORT is being actively encouraged in the country and international matches and golf coverage are being hogged by SKY. If SKY have the commercial acumen I credit them with, watch them make these channels available quickly so they can sign up subscribers before the rest.However, it may already be too late, because more and more sport is becoming available free on the internet(for the price of watching a few adverts).

  • Comment number 25.

    My problem with SKY has always been cost. To get their exclusive sports package (£18/month), you have have to take at least one of their entertainment packages (£18/month). Therefore you end up paying £36/month for a lot of channels you don't actually want, just so you can watch the football / cricket; although to be fair they are not the only provider to take this approach.

    By making Sky reduce the amount they resell the service for, OFCOM has opened up the market so other providers have the option of just providing Sky sports 1 /2 at probably a similar rate to Sky so the sports fans have the option to pay for just sport they want and both Sky and the reseller can make a profit.

  • Comment number 26.

    Take video delivery of sports events out of the the hands of third parties (eg SKY)and give it back to the event organisers themselves.
    Event organisers would hire an independant production team and time slots on "pay to view" Sports Channels, made available on Freeview, Freesat and internet.
    This cuts out the middle men who take the money and contribute little (eg SKY)and allows fans to just purchase the sports of their interest.

  • Comment number 27.

    18. At 09:40am on 31 Mar 2010, phil wrote:

    "if sky invested in both delivery and content they should be allowed to profit on their investment at whatever price it can get."

    Would you be saying that if the product wasn't just TV channels, or is a monopoly only bad when it controls the supply and price of food and the such like?...

    In my opinion Ofcom hasn't gone far enough, all BSkyB platform content (channels) should be unbundled, meaning that one can subscribe to individual channels and not just channel packages, this would have the effect of cutting out much dross and repetition fro the EPG, also any channel where viewing is subscription based the channel should be banned from carrying any paid advertising (although selling broadcast hours to 'advertorial' (marketing) programmes would still be allowed), this would help the commercially funded channels from ITV, Channel Four and Ch5 by reducing the number of channels were the available television advertising budgets can be spent.

  • Comment number 28.

    I'm a customer of Virgin and I really object to having to pay a subscription for a second cable box in my house. I can't see the need for it, apart from profit. The Americans run the same system yet their prices are much lower (ok, sheer load of numbers is probably the reason there), but there's no charge for extra boxes and no daft "second fee". While I am not an avid sports fan I do watch tennis and Eurosport/Sky do pretty good coverage. My sister is an avid football/cricket buff and will watch any game being televised. The movie channels are fine. However, the sheer cost of this every month is exhorbitant and I for one would welcome Sky cutting costs and HOPEFULLY Virgin taking the hint and reducing prices as well. At £90+ monthly for telephone, broadband and TV it's really expensive. Any price cut would be most welcome.

  • Comment number 29.

    This argument is nothing to do about the availability of sport. Ample sport including premiership is available on Freeview, Virgin and BT in the form of ESPN. This is about BT and Virgin making more money by getting Ofcom to reduce wholesale prices. Ofcom have been duped.

  • Comment number 30.

    19. At 09:40am on 31 Mar 2010, Vic wrote:

    "Sky has the advantage of being our only satelite broadcaster. Why not fund the BBC to launch their own satelitte & compete with Sky. "

    Err, I assume you are unaware of the "Freesat" brand then, or the fact that there are many non branded (packaged) satellite channels available via standard free-to-air satellite receivers!

  • Comment number 31.

    I don't get enough time to watch TV much, but the odd occasion I do is usually for sports, and if I can, on a big screen in a bar somewhere... Sky have developed the technology, but it is a monopoly. Ofcom are not regulating prices for the HD aspect of the Sky coverage, which is where Sky have been ploughing their money for at least the last 5 years. The other "technologies" like multi-screen and such are not mentioned at all. Selling Sky Sports 1 & 2 at £20 less than current should not have a catastrophic affect on Sky. Those who choose to leave Sky for a competitor and pick up the Sports channels will still be providing money back to Sky - hey, they might even make MORE money from it.
    As for "improving the game" and "bringing more talent to the shores" it's true that that has happened, but there has also been an massive influx of money grabbing cheats and time wasters. Sky have assisted with the encouragement of bad management within the upper echelons of football by offering such lucrative rewards that people feel they must win at all costs.
    There is so much good that Sky have driven and brought to market, and yet if you look at the bigger picture you cannot help but wonder at some of the destruction if that it has left in its wake...

  • Comment number 32.

    Isn't it about time we have true market reform of sports, and let each individual team/club put together their own deals.

    I don't see why, in football in particular, you can't have regional clubs set up their own subscription based channels to watch games in full after they've been played at the ground. For example in my area, West Brom, Villa, Birmingham, Wolves, Coventry and Walsall could quite easily come together to make a West Midlands Football channel of their own. It is the negotiation through the Premier League/Football League that is one of the issues.

    Murdoch has caused football to become incredibly expensive for the fan at the ground, as well as to watch it on the TV, and anything to help bring a level of realism into sports and their wages has to be welcomed.

  • Comment number 33.

    21. At 09:56am on 31 Mar 2010, Brinsley Schwartz wrote:

    "No doubt, that those of us who choose to subscribe to Sky, will now have our subscriptions increased."

    ...and if enough of you refused, voted with your direct debits?

    I can't think of any recent service industry were the customer allows the seller to dictate price to the purchaser - being able to do so is surely the definition of a monopoly (something we haven't seen since the days of the nationalised service industries such as Gas and Electricity)?...

  • Comment number 34.

    23. At 10:03am on 31 Mar 2010, ARHReading wrote:

    "Sky has good technology and a wide portfolio of programmes, sport and movies. All this at a price for little more than many would spend on quality newspapers throughout the month. Sky doesn't feature high on my list of things that I would like to put right."

    Apart from it's sports content BSkyB (TA "Sky") make/commission very little of own content, indeed most of the channels carried by the BSkyB EPG are (what could be called) piggy-back channels who pay BSkyB to be listed on the EPG etc.

  • Comment number 35.

    22. At 10:01am on 31 Mar 2010, myk wrote
    ------------

    but point still remains though, sky are not the Only service provider.

  • Comment number 36.

    Sky has said it will take this to the Competition Appeal Tribunal which typically takes between 1-2 years to complete.

  • Comment number 37.

    If football and rugby are getting so much money from being on sky, does that not beg the question that it is overpriced viewing? After all are they are being paid from the profits on the broadcast?
    If the cost to the viewer is less, then more people will subscribe? Same profit, same money into the sport.
    Or is my knowledge of all this wrong?

    The investment in the infrastructure of the station must now have been paid off, after all they have being around for a few years now so that as an excuse should be ignored.

    I am of the overall thought, if the sport is available to watch, then the future generations of sportsmen and women will be inspired to take it up. Such an old fashioned view.

  • Comment number 38.

    At 09:13am on 31 Mar 2010, kakuta jigs to the liquidator wrote:
    Blar Blah bar

    ...Sky innovating..
    .. football increase
    ..communist act is going to be a detriment to the whole of sport in the UK.
    ___________________________________________________________________________
    man you must be tripping
    Beach

  • Comment number 39.

    Its strange to see so many people saying that as Sky have paid for it, they should be allowed to what they like with it. What OFCOM are saying is that Sky are using their dominant position as a content provider to dominate the market for how customers get the content. Basically, Sky are using Sky Sports, etc. to get more people to subscriber to the Sky satellite system, instead of Virgin, etc.

    Didn't BT do something similar about 10-15 years ago with dial-up internet? OFTEL, as it was then, forced it to sell internet bandwidth to wholesale providers at a price which reflected its real cost, which turned out to be really good for consumers (cheaper internet) and the spread of the internet in the UK.

  • Comment number 40.

    Sky V Offcom -
    It is foolish for people to think they can stand up against God when they are afraid to even confront a crocodile. How much more powerful is God! It is better to submit to Gods loving authority than to face his wrath

  • Comment number 41.

    Ofcom is in the wrong here. Sky gains its advantage by doing a better job than its competitors do - that is not 'unfair' it is a display of greater competence.

    Commercial decisions always leave some people unhappy. In Crewe, due to heavy early adoption of satellite TV, nobody will lay cable... and I would like cable for broadband rather than for TV - I happen to like the Sky package (not including sports channels as nobody in this family cares to watch sport) that I have, but I would like cable-quality broadband rather than copper wire. But I realise that it's not cost-effective for anyone to run cable down my street just to satisfy my needs, so I don't whinge about it or expect someone to Do Something.

  • Comment number 42.

    34. At 10:38am on 31 Mar 2010, Boilerplated wrote:

    "Apart from it's sports content BSkyB (TA "Sky") make/commission very little of own content,"
    __________________________________________________________________________

    Not sure if you appreciate that News Corp, which owns B Sky B, also owns the film company 20th Century Fox. So all of that content inevitably ends up on Sky Films.

  • Comment number 43.

    What greater choice for consumers? In much of the Peak Park there is no Virgin, no fast broadband and not even Freeview, Sky is the only choice. Do OFCOM ever leave London?

  • Comment number 44.

    #3 AtNotts, don't you understand that monopolies are bad regardless how they became so powerful? Once you have a monopoly, the supplier can charge what they want. The Digital TV market is an oligopoly and needs a regulator to impose certain standards on the supplying companies.

    Now, in theory markets should be open with no barriers to entry for suppliers. This leads to the best match between what suppliers will charge and what customers will pay. Digital TV has significant barriers to entry for new suppliers and the market leader can make hay.

  • Comment number 45.

    Ofcom should have considered Picnic on its own merits as is is not related to the wholesale argument. If Sky were now to apply to Ofcom for picnic Ofcom have no grounds to refuse even if Sky does appeal the wholsale ruling.

  • Comment number 46.

    How can it be `live sport' when its on the telly? Live sport is watching the match in the flesh.

    If I want to watch people kicking a ball, which I usually don't, I would go and watch a local team as it is far more fun than the polished professionals.

    I am quite happy for `live sport' to be stuck away in a televised ghetto called Sky as it means I will never have to watch it and the associated moronic culture and commentary.

    I know that leaves the overpaid management at the Beeb short of mind-numbing rubbish with which to fill their schedules but if they paid themselves less, connecting better with normal society they could put out some very good programmes both documentary, music and drama at little cost. Television does not mean it has to be expensive.

  • Comment number 47.

    41. At 11:07am on 31 Mar 2010, Megan wrote:

    "Ofcom is in the wrong here. Sky gains its advantage by doing a better job than its competitors do - that is not 'unfair' it is a display of greater competence."

    Total rubbish with all due respect, all "Sky" did was thrown (news International Corp.) money at certain sports, and then hide the content (mostly, previously free-to-air) behind a pay-wall meaning that supports of those sports had little or no choice than to pay what "Sky" wanted to charge - as their dominance grew they bid and won ever more rights that they also hid behind a pay-wall, at no time did they do anything better, that is just their propaganda, indeed much of the technical/presentation side of their OB's were (and my still be) contracted out to other broadcasters if I remember correctly.

    Having greater 'financial clout' doesn't always mean the service is better.

  • Comment number 48.

    Why the terrestrial stations are stupid enough to buy second hand sport from Sky is hard to understand. Sky uses this to outbid the opposition in the first place. The use of taxpayers money by the BBC to subsidise Sky in this way should be subjected to a serious examination. This is a gross misuse of public funds.

  • Comment number 49.

    #39 DT_1975

    imo a big difference between BT and SKY is that it was largely public money which paid for the infrustructure at BT. Sky was a straight shareholder money investing for a risky profit

    As much as i hate to admit it i can see Sky's point here, Bt and Virgin had every opportunity to bid for football coverage rights and did not do so. Sky did and so it seems they should reep the reward for this. A lot of people at the time saw this as a great risk.

    Overseas cricket tours didn't really seem to get coverage on existing tv and sky has dramatically improved the quality of football coverage.

    Its difficult to argue that watching the premiership needs to be a cultural activity for all, rather than a choice.

    IMO the issues are; who controls the quality of a so called newspaper which is literally used as pure properganda in the ofcom war, and why does Richard Branson always seem to get support for running less efficient businesess

  • Comment number 50.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 51.

    At 09:13am on 31 Mar 2010, kakuta jigs to the liquidator wrote:
    Blar Blah bar

    ...Sky innovating..
    .. football increase
    ..communist act is going to be a detriment to the whole of sport in the UK.
    ___________________________________________________________________________
    man you must be tripping
    Beach

    --------------------------

    I'm tripping.? when you're talking about acts of God and metaphorical crocodiles.? explain that one.

  • Comment number 52.

    At home I run all my media needs through Virgin, It probably would be cheaper to use Sky directly (as I have Virgin's full service package) But as billionaires go I have always found Branson to be a good egg and Murdoch to be a rather villainous creature. Even an old miser like myself sometimes puts principles before pennies.

  • Comment number 53.

    Do we have a free market or don't we? No competition, only legislation. I think the books of Ayn Rand need a dusting off.

  • Comment number 54.

    Sky have been happily piggy backing off BT for broadband/calls etc(due to BT selling at wholesale prices) but want to keep the sports for themselves to gain the advantage on bundling them alltogether. Times are changing this should open up access to more subscribers at a sensible price no more having to have entertainment packages just to watch the sports.

  • Comment number 55.

    About time too! Sky have been propping up the ridiculous wage demands of premier sporting figures for years. Hopefully this will lead to a more balanced approach to the running costs of,for example, football clubs, where 95% of the club's costs are wage bills. No wonder so many (premiership!) clubs are on the verge of bankruptcy. With less revenue from monopolists like Sky, sports clubs will be able to negotiate lower wages with their stars. If the stars want to clear off to another country for a higher wage then so be it. It might even get some home grown players into our clubs rather than relying on big name foreign signings who have "show me the money" tattooed on their foreheads. Good news all round.

  • Comment number 56.

    It seems to me the wrong decision. Anybody could bid for the rights that Sky have. Indeed Setenta did, and paid too much, and ended up going bust. There will no incentive for companies to actually bid for sports rights anymore, as all they need to do is wait for Sky to pick them up at a reduced price (As why should Sky pay more if no one is bidding against them)and then buy coverage from Sky.
    What I think will happen is that the poor sports that rely on TV money will be badly affected (Cricket, Rugby League etc). Football will be less affected, but it is likely to hasten the day when clubs will negotiate their own rights and introduce pay per view. This will benefit the richer clubs, whilst the smaller clubs will see their income reduce. Customers who want to see the best games will probably end up paying more.

  • Comment number 57.

    5. At 09:06am on 31 Mar 2010, Mathew wrote:
    I look forward to Sky moving their Premier League coverage to Sky Sports 3 and 4 from next season.

    Simples.
    **************************************
    Mathew, you may wish to consider reading the full article before putting fingers to keybaord:

    "And Ofcom has said it will extend the ruling to any Sky channel if the broadcaster simply responds by moving its best sports content to other channels - namely Sky Sports 3 and 4."

    Simples ;)

  • Comment number 58.

    @Kathleen, yes £90+ is expensive for that package. Dont see how Sky reducing their prices will stop your Virgin being so exorbitant though, I have the equivalent Sky package myself and it's alot less than 90 quid!!

  • Comment number 59.

    Moderators
    Might I respectfully rquest my numero 1 posting to be re-instated?
    Yes it was deliberately off message but regular posters may well have seen the intended humour in my referring to a banking story in light of a recent trend for many to complain that Robert presents too many of these.

  • Comment number 60.

    The key point is that Sky have a powerful monopoly on certain media. I like Rugby, but I cannot watch my premiership games unless I pay Sky money.
    Is what I'm paying fair? I have no ability to judge, as I can't see a whole match unless I subscribe to Sky. Until recently, I had to subscribe to a whole set of packages, just to watch this one sport.

    Does sky do a good job of being a middle man between the sport, and me the supporter? I have no ability to judge, as only Sky are involved: there's no competition.

    I live in the country, can I get cable or Freeview? No. Later in the year, Freeview will be boosted, and I'll be able to get it, but until then Sky have a monopoly on getting CBBC to me for the kids etc.

    As we've seen countless times from other industries, commercial monopolies are bad, they breed compacent, lazy management, who don't serve their clients as well as they should.

    Ofcom have done correct thing for the country: Murdochs feelings are irrelevant. The people of Britain come first, profits of companies second.

  • Comment number 61.

    7. At 09:09am on 31 Mar 2010, Kathleen Cameron wrote:
    If you want to move back to talking about banking, go to the blog dealing with it. This one is about Sky's wholesale prices and how a cut in costs are needed.

    OK Kathleen. Sorry to upset you.

  • Comment number 62.

    Sadly, all I can see happening is quality deteriorating. SKY Sports provides the best coverage of any sporting event, and a large portion of subscription fees are fed straight back into production. This may no longer be the case, and we may lose our only true innovative broadcaster due to a silly Ofcom hunch.
    This seems like BSKYB are being punished for being a successful business.
    Poor show... as ever... Ofcom

  • Comment number 63.

    Have been a sky customer for many years, never once have I found fault with them, service has been excellent and I love the sports.

    I am not at all impressed with this decision and the effects it will have on the sports funding within this country.

    So what if a large % goes to the elite, that just happens to be the way of the world.

    Virgin and BT dont offer the coverage that Sky do, they have decided that they are not getting these channels at a fair price no one else, so thrown all the toys out the pram.

    Who said you dont get anything for nothing. Shame on Ofcom. I am now cancelling my BT landline and will never purchase again from Virgin.

    They have every right to bid for these elements and they have only moved into this area as they have seen what can be achieved in terms of revenue. Now they want a helping hand to compete without putting anything back in.

    A joke, a very sad one at that.

  • Comment number 64.

    Sky are the only channel who have consistently invested in sport and sport coverage. I can't comment on football/oikball, but do watch a lot of cricket. Sky show every ball - and they gave us enhanced hawkeye, hotspot, super slow-mo, high definition and more. Their analysis is superb and it's their technology that has enabled the referal system.
    Left to fester under the BBC or Channel 4, we'd still have most of the afternoon's play interrupted by the 2.40 from Lingfield and we'd probably be watching from two static cameras and listening to Trevor Bailley... The Ashes has already been given to a terestrial broadcaster and I'm sure will be several steps-down in quality from last year's high definition experience.
    If Ofcom wants to break 'monopolies', let them start with the license fee?

  • Comment number 65.

    Who controls the TV service also controls the TV news. I don't believe that it's good for democracy for so much news information, TV and newspaper, to fall under the control of one organisation.

    If the Murdoch organisation gets too close to a future UK government, it would be too easy for them to turn the country into a banana republic.

  • Comment number 66.

    46 stanilic - gosh you've brought the whole argument crashing down with your brilliantly pedantic observations on 'live'.... you must have missed the context in which it is being discussed - BROADCASTING

    Hunt around the Sky channels and you'll find the things you listed and they are top quality!

    ... or maybe you just want TV free and the way you like it!

    As far as the debate goes, the RFU & Cricket bods have fallen for the oldest trick in business.... restrict your supply to make the most revenue (remember the car manufacturers making it difficult to buy right hand drive cars cheaper on mainland Europe and the trouble they got in to?)... it's good business, but illegal!

    I'd have more sympathy for them also if they weren't shysters - I like to watch golf and can buy the cheaper packages with just Sky Sports 1 & 2.... fine, other than they'd put the first 2 rounds on SS1, then switch the final 2 rounds to SS3 and SS4... so you had to get the full package. This is done with most sports!

    In this day and age it is not beyond Sky to deliver just what I want to subscribe to... which doesn't include Football, Cricket, Rugby, etc

  • Comment number 67.

    While I'm no great fan of Mr Murdoch, it has to be said that if Sky took the initial gamble - and the initial losses - and then subsequently emerged with success, why should they now be forced to share that success with their competitors ? Such rulings say a lot about why our economy is in the doldrums. Penalise success - reward failure. Caledonian Comment

  • Comment number 68.

    I can understand why people don't want sports spread across different paid-for providers, but I think Sky have shown time and again that they have no qualms about exploiting consumers if given the opportunity to do so.

    They have created multiple sports channels and spread their premium content across them to encourage customers to pay more for all the channels. Then on top of that showing some events on PPV at significant additional cost without any form of discount for people who already subscribe to the sports channels. Back when sports was a free channel they even put some events on Sky Movies in order to get people to subscribe to that.

    There's no ideal solution, but letting Sky go unchecked would just mean paying them more and more money for the same stuff.

  • Comment number 69.

    #60. At 1:30pm on 31 Mar 2010, Crookwood wrote:

    As much as I agree with the sentiments in your comment I really must pull you up on one factually incorrect assumption;

    "I live in the country, can I get cable or Freeview? No. Later in the year, Freeview will be boosted, and I'll be able to get it, but until then Sky have a monopoly on getting CBBC to me for the kids etc."

    No they don't, any DVB-S receiver will access the BBC content, either Freeast, even non branded receivers as often sold by independent/specialist suppliers, or indeed stores such as Maplins.

  • Comment number 70.

    It would be interesting if Sky sell their entire rights to the Sports packages (Premier League Football, Cricket etc) to a another company based in say ‘Liechtenstein’ outside of the EEC.

    This company would probably be owned by News Corp or one of it’s divisions and Sky would then buy the packages back from this company and sell on to it’s customers. As Sky would no longer be the ‘rights holder’ to these events it would not be in a legal position to resell them wholesale to other providers such as BT and Virgin.

  • Comment number 71.

    Once again, great britian is knocking down another of it's successful, great companies (okay, perhaps not morally, but you know what I mean - a great success).

    Sky - commercial success, no public tax bundled into it.
    Shame offcom doesn't come down that hard on the BBC eh?!

  • Comment number 72.

    It appears to me , that Sky bought the rights to these packages in the open market...perhaps the other broadcasters should club together in a joint package and outbid sky....that would in effect kill off their business model.

    Personally i dont like the business model it has done nothing for the sport apart from drive up wages to insane levels.My solution is not to have Sky, it means i dont watch live sport, so be it ,it is not a necessity.And the rest of the drivel they show is in the main just recycled free to air programs anyway.

    I think this is just a political dig at Murdoch for having the affront to come out in support of another party.Nothing i have seen from Ofcom has been for the good of the public and likewise i see no good coming out of this.Apart from the lawyers who will be involved.

  • Comment number 73.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 74.

    62. At 1:34pm on 31 Mar 2010, Alex Dimitri Song Billong wrote:

    "This seems like BSKYB are being punished for being a successful business."

    No, they are being punished, quite rightly too, for becoming a monopolistic and then abusing that position.

  • Comment number 75.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 76.

    64. At 1:47pm on 31 Mar 2010, ricardoleadieri wrote:

    "Sky are the only channel who have consistently invested in sport and sport coverage. I can't comment on football/oikball, but do watch a lot of cricket. Sky show every ball - and they gave us enhanced hawkeye, hotspot, super slow-mo, high definition and more. Their analysis is superb and it's their technology that has enabled the referal system."

    Sorry but it was far better in the days of the BBC (who showed every ball and every bowler run-up, unlike some broadcasters today...), we the audience followed the match, the broadcasters didn't control the game, "Sky" has changed cricket even more that Kerry Packer did and he did enough damage to the game - to me it's no longer cricket, Sky has ripped the heart out of the game, cricket is now just another money making machine.

    I suspect that you have never known just how good cricket was on the BBC.

  • Comment number 77.

    68. At 2:31pm on 31 Mar 2010, MrJimjam wrote:

    "There's no ideal solution, but letting Sky go unchecked would just mean paying them more and more money for the same stuff."

    I strongly suspect that if left alone to carry on in it's (proven) monopolistic way, BSkyB would actually cause the death of much UK (professional) sports, not only will people not bother to subscribe to Sky Sports but because they then don't watch such sport on the TV when at home they will be less likely to attending sporting events in person.

  • Comment number 78.

    Robert Peston Made a mistake in his lunchtime news report on Ofcom and Sky last night's Bayern Munich ? Manchester Utd match was NOT exclusively on sky as I watched this "Free to air " on a German Tv station through my satellite dish as I do on many other occasions via other National stations so I'm quite happy for Ofcom & Sky to have a legal wrangle through the courts

  • Comment number 79.

    70. At 3:03pm on 31 Mar 2010, Nick wrote:

    "It would be interesting if Sky sell their entire rights to the Sports packages (Premier League Football, Cricket etc) to a another company based in say ‘Liechtenstein’ outside of the EEC."

    I don't think that they will try pulling that stunt, it would be far to easy (for either the UK or EU) to just block/control the sale of the viewing cards once the provider is outside the EU block.

  • Comment number 80.

    A lot of this has to do with coverage, and the ability to offer multiple channels. Until digital TV was available, the only option was terrestrial and satellite. Becuase of the restrictions on terrestial bandwidth, and broadcasting licenses, only satellitte could offer a wide range of channels, and get specific programme related revenue.

    Now within a year we will (all) have digital TV broadcast at decent power so you will all get very good reception across 50 + channels. There is also bandwidth for HD channels. The technological debate over sky's transmission superiority is no longer relevant.


    However to be useful these channels will need content. While there is a lot of filler out there, it would make more sense to offer sport in particular to as wide an audience as possible. This can't be done economically while Sky have a monopoly on licenses. If somebody had enough money, they could enter a bidding war, but the consumers don't benefit, and it's difficult to believe that the quality of sport would improve from having more money injected at the premier level. What we want is access to more sport for less money.

    Sport is more relevant than movies, becuase the transmission is time sensitive, it loses value very quickly if not shown in real time.

    It's also worth noting that sports TV production is very cheap, and the majority of feeds are made by independent companies, who anybody can use if they have the licence to use the material.

    In short, Sky is perceived as good becuase we haven't been able to compare like with like. Add choice then decide if they are that good.

    It's interesting that they've already started to unbundle some of the sports, just as Freeview is getting established...

  • Comment number 81.

    I believe SKY offer the consumer (ME) a good value offering. If my wife and I want to watch one rugby league game a month LIVE, it will cost me over £50. I get at least 12 games a month with SKY, for less than the price of ONE game, not including all the other sports and channels included. If somebody else wants to pay more for rugby league coverage, I am more than happy to watch it with them, and pay the extra, as the money will go back into the sport I support. But until then, leave SKY alone - they bought the rights in a fair and square auction.

  • Comment number 82.

    RE 69. At 3:03pm on 31 Mar 2010, Boilerplated wrote:

    Agreed, you're quite right. And you can get Freesat also.

    It just requires a bit of thought and perserverance.

  • Comment number 83.

    Sky bid for, and won, the rights, when competition was open to all.

    If BT and Virgin wanted to clinch the original deal to the rights then they should have bid the most - simple really. It is called competition and if u do not like the heat get out of the kitchen instead of trying this sneaky trick.

    How would any of you moaners on here feel if you paid for something only for someone else to be allowed to buy it from you for less than u paid for it???????? - I bet u would be hopping mad but as it is Murdoch the usual moaners come on about monopoly - have a look around u re monopolies or do I have to list them all.

  • Comment number 84.

    1. At 08:37am on 31 Mar 2010, Alesha Soba wrote:
    This comment was removed because the moderators found it broke the House Rules.

    59. At 1:17pm on 31 Mar 2010, Alesha Soba wrote:
    Moderators
    Might I respectfully rquest my numero 1 posting to be re-instated?
    Yes it was deliberately off message but regular posters may well have seen the intended humour in my referring to a banking story in light of a recent trend for many to complain that Robert presents too many of these.


    Fiest you show the message then the message is it has been referred then after my post 59 the message changes again to that above.

    Humour failure all round. Pathetic !

    Time to move to pastures new. Farewell Bloggers. It's been a slice.

  • Comment number 85.

    I don't think most people have got the reason behind this. If you want broadband you can go to any provider and get it, even though the lines in most are owned by BT. BT have to sell access to their lines seperatley from the actual product that we as consumers buy, therefore BT have to buy from BT at the same cost as everybody else in the market place. However Sky do not have to do this, and so ell the wholesale product to their sales arm cheaper than to BT and Virgin, which means they can bundle TV, Phone & Broadband packages together cheaper. This means the market is not fair and balanced. However, Virgin are still protected from other companies using their networks under the regs that they lay their cables in the 1st place - so are OFCOM going to change this? What OFCOM are trying to do is make the market more open and transparent, which they aim to make prices cheaper for the consumer. However thsi will fail as all the companies will do is the same as the energy firms in waiting to see what each other does, eg. prices go up but never go down.

  • Comment number 86.

    66 thinkbe4

    I was commenting about broadcasting: most of it is rubbish.

    Now Sky has to sell a product in order to turn a profit. Their product is of no interest to me so I won't be buying.

    What is of interest is finding something from any broadcaster with which I can be entertained. All any of them want to sell me is sport so two thirds of their proposal is of no interest. Why pay full price for a third of the output? If I want sport I get on my bike or go for a walk: its wonderful! You even get to go somewhere.

    I have a next door neigbour who involves himself in sport; he wears all the right sporty clothes, pushes his boys into playing football for local teams (the eldest now refuses), and just loves to put his feet up before Sky to watch sport and drink beer. However, he can't walk very far and thinks a bike ride is a quarter mile long.

    I just feel people are being brainwashed by Big Money as sport is now the opiate of the people.

  • Comment number 87.

    OFCOM made BT open the network for others to use bringing down the price of broadband etc, all BT/Virgin want is a level playing field so have been given access to SKY's content at a fair price. Hopefully in the future if you just want to watch football or rugby it will be on 1 channel as sky forced you to buy packages you did not want but had to have for the football. I left SKY for this reason and will gladly go to BT or Virgin if they offer packages I want without add ons.

  • Comment number 88.

    I notice I can go to Manchester City matches for £16 (or more) but I do agree I can go to the pub and for approx £8 see the REAL thing on Sky from all angles. I know the beer is cheaper at home but the sky sub is twice or three times the price. It's true I can afford the other team's games, but I can see Liverpool are four pounds return on the bus but admission is dearer than City. Oh and films are £5 in the Cinema for time the REAL experience, and last years films are £5 at F+p.

    So whats the problem?

    Incidentally you can get FreeStat in up in the hills near me if you have an antenna.. and an old sky box though HD will require a new receiver.

    So who really wants Sky... shouldn't you just get out more?

  • Comment number 89.

    Well now we know why Murdock is backing the tories and not labour this time,
    as i understand BSkyB is going to appeal, which could take a year, and what are the tories going to do if they get in scrap ofcom.

    Everyone knows that Sky is to powerful we need more competion and fairer prices, i subscribe to Sky sports and Movies through Virgin Media,but i cant access a lot of content on Sky Player which is unfair.

    I still think this will be overtuned if the Tories get in.



  • Comment number 90.

    Mark this is a reply I got from Jeremy Hunt Tory Shadow Secretary of State for Culture, Media and Sport in January

    Thank you for your e-mail to David Cameron. As Shadow Secretary of State for Culture, Media and Sport, my brief covers Ofcom, thus David has asked me to reply.

    You are absolutely right that the issue of Sky wholesale is a matter for Ofcom, the independent media regulator. As such, the decision will be left to Ofcom and I can assure you that we will not interfere in any decision that they make. I would also like to point out that Rupert Murdoch is not a Conservative Party donor.

    But can you believe what an MP says

  • Comment number 91.

    #83 Oh goody Rupe had the most dosh to bid - so now he gets to screw ordinary sports fans who can no longer afford to attend games.
    Dead fair that - numpty.

  • Comment number 92.

    Who cares? For all the hoo-hah you hear about sport on TV, it's a minority interest. Of all the people I've know at work over 25 years, only a fraction have been interested, and those that are seem increasingly disillusioned with the absurd expenses involved in following, say, football. Before long the entire industry will implode into its own gravitational well of stratospheric salaries and frankly obscene rights payments. Good riddance say the rest of us.

  • Comment number 93.

    I wouldn't pay the man for a jelly baby myself. Still, best to stop the creation of another industry that becomes 'too big to fail'.

    OFcom ensure they meet the needs of the viewing public and no cartels.

  • Comment number 94.

    It is time Ofcom took BskyB down on wholesale prices so all bskyb competitors can buy the right to show at a price that is competitive.

    It is better for us all if Ofcom make this move as bskyb have had it all there own way for too long paying top price for the sports to be the exclusive suppler of these sports

    which as meant that some sports can pay silly wages to there players and import players and the lower level teams can not afford to bring on new talent as they can not pay top wages and the supporters have to pay top price either at the gate or to bskyb

    If you look at how broadband as gone from been a extra £15 to £30 a month on top of your phone bill to been bundled with your phone line for a few pence

  • Comment number 95.

    What a big suprise, sky think ofcom got it wrong and all the other tv broadcasters don't! Sky Charge way too much and shouldnt be allowed to dominate the market and charge what ever they want for it. Sky is scared of competition.

  • Comment number 96.

    'This cuts out the middle men who take the money and contribute little (eg SKY)and allows fans to just purchase the sports of their interest.'

    Ridiculous. The Premier League would not be anywhere near the standard that it is today if it was not for Sky. Just look at the Scottish Premier League now. Football is only a minor point here, but to say they contribute nothing is ludicrous, they have invested billions in football alone.

  • Comment number 97.

    This is great news for English football in general, not just the paying public due to a possible end for Sky's obvious exploitation of their, in all fairness to them, self-developed market position.

    By fixing Sky's wholesale prices to other broadcasters it's pretty clear that Sky's competitors will have far less interest in bidding for the EPL bundles. After all, why take the risk and pay the cash up front when you can effectively just pay the wholesale price for each package you sell to Joe Public? As a result it's also clear that Sky will not bid as much for the EPL bundles themselves, which means less TV payouts going to English football clubs.

    The advantage of this is we'll see some of the money grabbing mercenaries from abroad go and play their football elsewhere and more youngsters given a chance at a slightly earlier stage. Granted we could lose a couple of big players because they can't get the big wages they were offered before, but isn't this already putting off players from abroad due to the Government's 50% super-rich tax band, e.g. Ronaldo clearing off to Spain where he's paying far less tax (albeit that was also arguably motivated by football related reasons), and Ribery/Villa's obvious wish to hold out for a move to Spain rather than transfer to England...

    Hopefully we'll see the non-Oligarch bankrolled top clubs occasionally fall short of the cash to tempt away the rising young stars from mid-table clubs, and we'll see a greater possibility of a team rising from nowhere to compete for the title, namely inclusive of upcoming young English talent that will feed through into the English football team…

    Here's to hoping anyway!

    (A non-Sky4 club supporter)

  • Comment number 98.

    Isn't this a form of price-fixing?

    Surely as Sky bought the likes of the Premier League, SPL, Champions League etc on the Open Market, they should be able to charge whatever they feel is correct.

    As a Sky Customer for 5 years (with full Sports, Movies & HD, and Sky+ Multiroom) i'd like to know why Ofcom thinks it's OK to force Sky to charge less to the likes of Virgin, BT etc, but NOTHING about it's own distribution to it's customers.

    In theory, this could mean Virgin & BT prices get cheaper, whereas Sky Customers still pay the same. Now I know that it's likely Sky would reduce prices (to counter this ridiculous announcement of their competitors getting it cheaper) thus i'll probably see a price reduction.

    I'm no fan of Murdoch, but this is a business, not a charity, and whilst the Premier League et al pay footballers stupid amounts of money (IMHO there isn't a player on this PLANET worth what they actually get paid) it's always going to be a tough challenge, and could well effect the EPL teams wage offers to new players, putting the quality of the EPL at risk. I highly doubt it'll end up like it did in Scotland where the League decides it's too greedy and rejects the best offer in it's history, but seriously, Ofcom really can't expect Sky to go forward with this. I certainly don't! Do we now live in a society where the big-wigs & government decide what people should pay? Funny, I always thought that was based on SUPPLY & DEMAND!

    I DEMAND my Sky be top notch quality, and Sky SUPPLY me that, i'm very happy with my service, and the price to go with it, but if BT & Virgin are told they can get it cheaper by Ofcom, then what happens to Fair Trade? It's hardly Sky's FAULT that they dominate the market in the UK. Why penalise a company just because they're successful?

    Typical rip-off Britain . . .

  • Comment number 99.

    My personal feeling is not that BSkyB are doing anything particularly wrong, its the Premier League. OFCOM dont regulate them unfortunately (I dont think). They have acquired a 'product' (i feel ill even calling it that) built by millions of fans round the country over the best part of a century and "EPL CORP" are the ones selling 'exclusive rights' to this broadcaster to maximise profits. Whilst I realise the Premier league wants to attract the best players from around the world (which naturally costs a bit more money than foreign domestic leagues are prepared to pay) but do the British/English fans really want this in light of the ultimate cost? For me this argument is not about whether BSkyB are overcharging their wholesale customers, but whether the people of this country (UK) want their national game to be scaled up to this extent or reigned back in so that it becomes more affordable for joe public to watch again. OK so MAYBE EPL CORP are fleecing overseas markets a bit to subsidise us (which we may or may not be comfortable with and may not even be true?) but is it really making our national game 'better'? With so much foreign ownership, by scaling back we (Britain) might actually wind up making a profit and get back to where we started. My solution would be for the EPL to be subjected to more regulation in what they spend their money on - ie investment in the youth game and sports facilities for all around the country. I cant remember the last time I played on a decent state owned football pitch that wasnt covered in glass, dog *** , bare mud patches and uncut grass. I have played a lot of amatuer football all my life and have always loved watching it but now I dont buy Sky cos I feel its unnecessarily expensive. As much as I love tevez, I dont want to be giving him 20 a month, sky shareholders 10 and EPL bosses 10 or however they share it up). This makes me believe that either I'm much tighter than the average joe (possibly!) or that we have another 'bubble', this time in football prices which will surely burst as bubbles usually do. Its time for Ofcom (or someone) to start letting it down gently.

 

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