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02/03/2007

National Consumer Council Warn Digital TV Giants Could Face Complaint

Virgin Media and BSkyB could face an official complaint following a row between the two companies which has left hundreds of thousands of customers without their favourite channels, the National Consumer Council has said.
The consumer body said it would consider invoking its statutory powers to push for a review of the digital television market from the Office of Fair Trading (OFT) if the situation is not resolved.
The switch-off came on February 28 after the deadline passed for the companies to resolve a row over TV rights. Reports suggest the row is over how much Virgin Media - a merger of NTL and Virgin Mobile - pays Sky to screen its channels.
National Consumer Council Philip Cullum said: "The fallout from the dispute between Virgin Media and BSkyB is bad news for customers. Over three million Virgin Media customers have been left high and dry."
The NCC will be making a decision by the end of March as whether to exercise its statutory powers under the Enterprises Act.
Sky has rejected Virgin Media's offer of arbitration and Virgin Media has rejected Sky's latest offer, confirming it would not table a new offer of its own.
Sky has also proposed to retail its basic channels directly to Virgin Media customers if Virgin Media will provide access to its closed platform.
Sky One includes popular series such as '24' and 'Lost' as well as new episodes of 'The Simpsons'.
Virgin Media CEO Steve Burch commented on the dispute: "We're disappointed but not surprised by this outcome: nothing Sky have said or done in the course of the negotiation indicates that they had the slightest interest in doing a commercially viable deal. Their action here is consistent with their plans to withdraw their free channels from Freeview."
Virgin founder Richard Branson said: "We're sorry that Sky have pulled their basic channels from our service. These however do not include their sports and movie channels, which continue to be available to Virgin Media's customers."
A statement on Sky's website said: "Unfortunately Virgin Media have decided to drop these channels. This was their decision. As a "closed network" only they can decide what to offer their customers. Up to the final hours we tried time and again to reach a solution, including proposing a way for Sky to retail channels directly to cable customers in a way that would cost Virgin Media nothing."
A Sky spokesperson has said: "If Virgin decides that it wants to bring back the TV that its customers enjoy, we're available for talks at any time."
A complaint could lead to enforcement action by the OFT, the launch of a market study, or referral to the Competition Commission.
Meanwhile, the government has ordered media regulator Ofcom to investigate BSkyB's controversial purchase of a 17.9% stake in ITV.
BSkyB's decision to buy into ITV was seen by some as an attempt to block a bid for the firm from its then rival NTL.
(DS/SP)
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