The chairman of the Competition Commission inquiry group into the market for pay-TV movies has said there remain questions as to the effectiveness of the pay-TV retail market.
Laura Carstensen’s comments came as the Commission restated its view that BSkyB’s position in the acquisition and distribution of movies in the first pay window does not adversely affect competition in the pay-TV market.
“In our view, competition in the pay-TV retail market overall remains ineffective but we were asked by Ofcom to look specifically at the role of first pay movie content and Sky’s position with regard to these rights,” said Ms Carstensen. “We have concluded that this content does not provide Sky with such an advantage when competing for pay-TV subscribers as to harm competition and, given this finding, we are not proposing any remedies. We note that, were there to be a material change in the circumstances which have led us to our findings, this might warrant renewed scrutiny of these issues.”
The final report ends a sequence of events that begun in August 2010 when media regulator Ofcom referred the supply and acquisition of subscription pay-TV movie rights and the wholesale supply and acquisition of packages including core premium movies channels to the CC.
Prior to this Sky had been required to wholesale two of its premium sports channels to all comers.
The CC concluded that “Sky Movies, which currently offers the first pay movies of all the big Hollywood studios, is not a sufficient driver of subscribers’ choice of pay-TV provider to give Sky such an advantage over its rivals when competing for pay-TV subscribers as to harm competition”.
According to the Commission more consumers believe that a broad range of content and price is more important than recent movie content. New services such as Netflix and Lovefilm reflect an increasing trend of new choice, powered by the internet, and which also includes Sky’s own Now TV.