Premium Sports and Movies - Ofcom's remedies

Armchair sports fans will soon have something to cheer, with the cost of watching live football, cricket and rugby on ­television set to plunge as rivals attempt to end the dominance of Rupert Murdoch's ­satellite broadcaster BSkyB.

BT and Virgin expect to capitalise on plans by the media watchdog, Ofcom, that will force Sky to drop the price it charges rival broadcasters for its Sky Sports channels in the biggest shake-up of sports TV for almost two decades. Prices should drop in time for the 2010/2011 Premier League football season.

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Media Guardian

Great news for the consumer, grim for BSkyB and intriguing for the Sporting Governing Bodies.

Sadly, I'll believe it when I see it.

Hmm - wonder how long that will last when Ofcom is disbanded by the Tories and Murdoch gets an unregulated Pay-TV landscape in return for The Sun supporting Cameron...

There'd need to be very rapid legislation though, as Ofcom can currently impose these rules pending appeal, so they'd be in place anyway.

Ideally prices would be ruled as artificially high, prices all round drop, Sky have less to spend on rights and hence the BBC, ITV and ESPN can compete on a more competitive basis.

The reality - whatever OFCOM rules Sky won't want their revenue to fall, so one way or another customers will pay the same or more. Sky will basically just charge themselves (and hence their customers) more for their own channels.

What it comes down to is the argument OFCOM have ignored for well over a decade - there is a conflict of interest with Sky being both channel provider and platform provider, and the only way that would happen if for the company to be forced to split into two operations, which simply won't happen!

Would my current £26-a-month deal with Virgin for all 4 Sky Sports channels be affected or am I tied to that now?

Probably not for those of us who don't currently subscribe to a sport or movies package whose basic subscription will inevitably rise to compensate Sky for the loss of revenue.

One thing is certain, Sky will get their money one way or another.

And that would be even more unfair.

It would be interesting to see whether the Sky Sports subscriptions cover Sky Sports, and similarly with Sky Movies - or whether they are topped up with a slice of the basic subscription too, which if they case is the sort of thing OFCOM should be ruling on.

Regarding Sky being a channel and platform provider, the same argument could be applied to Virgin.

Virgin don't produce premium content though.

Hmm - Virgin don't run premium sport or movie channels though - and although Virgin Media run quite a lot of basic channels, I don't think they have had serious conflicts with any platform who want to carry them.

At one point Sky weren't making all of their sports channels available on other platforms - and there have always been rumblings that they charge other platforms over-the-odds to carry their channels to reduce the profitability of other platforms...

In some countries you aren't allowed to have a dominant position in both the platform market and the channel market - to avoid this possibility.

Well Sky imo, have got away with it, Sky Sports 1 and 2 to have controlled prices and must wholesale in SD only, no restrictions as to repositioning events from SS1 and 2 to the uncontrolled SS3 and 4 either. They can operate Picnic too if they accept the conditions.

Movies 'might' be controlled later, and only if they put them on Picnic.

Sky will scream foul but it could and should have been much worse.

Ofcom