Julian Clover unpicks the carriage fee dispute between Sky and Virgin Media
There’s nothing like a cable spat to set the juices flowing and as the clock ticked past midnight it became apparent that there would be no immediate settlement in the dispute between cable operator Virgin Media and its satellite borne programme supplier BSkyB.
So many offers and counter offers have been made public that it has been difficult at times to keep up. As we understand it Sky is proposing a monthly carriage fee of 90p per subscriber, per month to cover a package of basic channels including Sky One, Sky News and Sky Sports News. Sky is also including a minimum guarantee, apparently at the behest of Virgin, but the cable operator is disputing the amount saying that it brings the cost back up to the original proposal.
One element that has emerged is that Virgin does not carry all of the Sky branded channels that BSkyB offers its own subscribers. But it’s not just Virgin – Tiscali TV, the recently rebranded Homechoice doesn’t offer Sky One or Sky News, although Sky Sports and Sky Movies are available as part of the Sky by Wire service.
While BSkyB has not missed an opportunity to remind people that it too can offer telephony and broadband services, Virgin has been using its radio and television appearances to talk about Virgin Central, the free video on demand service launched when the cablenet rebranded from NTL and Telewest at the beginning of the month.
One of the reasons cited by Sky for its price increase has been the investment in programming. These include the high profile acquisitions of 24 and Lost, purchased after the programmes had already established themselves on BBC Two and Channel 4. Lost is also a part of Virgin Central, at least it will be, though it should be remembered that Sky owns both the same non exclusive rights and of course will have first run of the programmes on Sky One.
Virgin Central currently has a handful of series; Alias, Little Britain. Nip/Tuck, Spooks, The Closer and The Office, some of which will only be familiar to the most avid TV watcher, though the line-up will be refreshed regularly. In the United States experience has shown that by offering viewers free video on demand they will be more inclined to sample the pay offerings.
BSkyB also has video-on-demand planned, but only to customers that have the Sky+ digital video recorder, about 20% of its 8.4 million subscriber base. Even then Sky Anytime would be unable to offer the range of programmes that a wired service can offer.