Five years after Ofcom’s pay-TV inquiry began the market is right back where it started, writes Julian Clover.
If the long running investigation into the UK’s pay-TV sector were an inquiry into the building of a hospital or an airport there would by now be calls for resignations.
The decision this week by the Competition Appeal Tribunal that Ofcom was wrong to impose wholesale rates on BSkyB for the distribution of two channels in its sports package followed two years after the levels were originally set. Before that there had been three years – and three consultations – as the regulator deliberated on what action should be taken.
Last week 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, but cleared Sky’s position.
In the UK an inquiry into the pay-TV sector effectively means an inquiry into Sky. Its longevity in the market, its dual role as both platform and provider of premium content, and of course its relationship with News Corp is never going to do it any favours.
In the period since the process began there has been a change in government. Ofcom was very much a creation of New Labour. Its founding CEO Stephen Carter was made a peer and served as a broadcasting minister. Even now the use of CEO seems strange in public body.
There were multiple appeals against the Ofcom decision, not just from BSkyB, but also the Premier League, BT and Virgin Media, the latter two believing the regulator had not gone far enough. There were also interventions from the Rugby Football Union, Football League, PGA, the England and Wales Cricket Board, Top Up TV and Freesat.
One of the post interesting elements is the charactarisation of Sky’s negotiation tactics, which to the outsider suggested were often viewed as being akin to ferrets in a sack, but seen by the Tribunal as having been misinterpreted by Ofcom.
The regulator acknowledged there had been some “regulatory gaming” – a phrase that will continue to be used if this writer has anything to do with it – but had apportioned blame to Sky. The tribunal placed a much greater emphasis on the regulatory gaming by competitors and the consequent lack of progress.
While everyone has been enjoying their day in court negotiations have been continuing. Sky Sports F1 offered Formula 1 to Virgin Media customers from the chequered flag, but the cable operator still has no agreement to show Sky Atlantic.
Meanwhile there was no BBC multiscreen Olympic coverage to the half million BT Vision subscribers. Anyone fancy an inquiry?
