Kangaroo must jump Competition bar

The three public service shareholders in proposed online project Kangaroo have expressed their disappointment at the decision by the Office of Fair Trading to refer it to the Competition Commission. The process will delay the project by at least 26 weeks while the Commission makes its deliberations and collects further evidence.
A joint statement from the BBC Worldwide-ITV-Channel 4 venture said it was disappointed by the decision and that all three remained committed to the project.

“The OFT’s decision shows that the assessment of the proposed joint venture involves some very complicated issues.  The parties are confident that when properly subject to more detailed scrutiny by the Competition Commission, the Competition Commission will conclude that the joint venture will provide wider choice for consumers and be seen as a pro-competitive force in the market place.”

ITV executive chairman Michael Grade went further, highlighting the £2.5 billion annual spend by the public broadcasters in original UK production, and accusing the regulator of stalling the project. “This venture has been delayed by a reference to the Competition Commission, at the very same time that non-UK companies like Google and Apple are free to build market dominating positions on line in the UK without so much as a regulatory murmur.”

The project would bring together the retail activities from the three broadcasters including the syndication of VOD content. The OFT says it is concerned that in syndicating the content to wholesale customers it could potentially force up prices to the end consumer.