Ofcom has announced it will not be conducting an investigation into YouView, the former Project Canvas, stating it would be premature at this stage of its development. However, the regulator warned it may reopen the files at a later stage.
Cableco Virgin Media and the receiver technology developer IP Vision had both called on Ofcom to investigate the hybrid television project under the terms of the Competition Act. A last-minute complaint by BSkyB had brought the total number of objections to 13.
YouView CEO Richard Halton welcomed the decision, saying the project had maintained throughout that it would stimulate competition in the TV platform market and create opportunities for content providers and device manufacturers. “In a market dominated by pay services, we are creating the only mass market IPTV service that will be subscription free. All our efforts are now focused on launching a brilliant consumer product for launch next year. We look forward to broadening our engagement with wider industry partners over the coming weeks and months.”
Led by the BBC, the other YouView partners are ITV, Channel 4, Channel 5, Arqiva, BT and Talk Talk. The initial product will be a DTT/Freeview PVR with the first products appearing by mid-2011. YouView enabled devices are expected to feature an Electronic Programme Guide that runs both forwards and backwards in time – allowing access to catch up TV – and apps provided both by YouView partners and third party developers.
Setting out its reasoning the regulator said:
- IPTV is still an emerging sector, and the impact of YouView on the market will not be known with any confidence for some time;
- It is likely that YouView will bring benefits to viewers and consumers. Any potential harm to competition would need to be offset against these benefits; and
- Whether or not YouView and its partners will harm competition in the ways alleged will depend upon how this emerging market develops and how the YouView partners act, particularly in relation to issuing technical standards and providing access to content.
“Ofcom’s view is that consumers’ interests will not be served by opening an investigation. It would be premature at the current stage of YouView’s development given the absence of a clear risk of consumer harm,” said Ofcom chief executive Ed Richards. “But if evidence does emerge in the future that YouView causes harm to the interests of viewers and consumers we may reconsider whether to investigate.”
Ofcom looked across three main areas of concern; content, standards and user interfaces. On content the regulator said that it was difficult to determine the impact at this stage, but said if the partners were to restrict the supply of video on demand content to rivals, it could generate competition concerns.
When it came to standards Ofcom said the partners had already made a number of technical standards available to the industry – readers will recall the early acrimony between Canvas and the Digital TV Group (DTG) over the interoperability with the UK Connected TV standard – and Ofcom said it does not justify an investigation at this stage.
Ofcom did identify a risk that YouView might result in a more limited choice of user interfaces and user experiences for viewers. But said an assessment would need to recognise the choice that already exists in the TV market and new opportunities for entry from other firms, as well as the potential benefits to consumers of a common ‘look and feel’.
Eddie Abrams, CEO of IP Vision, manufacturer of the Fetch TV product, expressed his disappointment at the decision: “It is clear from its assessment of the complaint against YouView that Ofcom shares and reiterates our particular concerns, namely the questions of content syndication and fair access to YouView’s technical specifications. Our view remains that YouView’s current commitments in both areas fall well short of the commitments made by the BBC Trust when YouView was first proposed”. Abrams said he would call upon to BBC Trust to exhibit transparency and fairplay in its regulation of the BBC’s YouView involvement.