Recent Tweets on @LSEMediaPaL

    Link to LSEMediaPaL on twitter

    I also used to be mediapal on del.ici.ous

    Wednesday 21 March 2007

    Pay-tv market investigation - the dead hand of Ofcom?

    Yesterday Ofcom announced its intention to undertake a review of the operation of the Pay-tv market, and to refer the market on to the Competition Commission for a fuller investigation if this proves necessary. Its planning to focus on control over content, ownership of distribution platforms, retail subscriber bases and vertical integration. The legal powers on which it is acting were provided by the Enterprise Act 2002 (it is already conducting a review of wholesale digital television broadcasting platforms under Communications Act powers).

    The move is being widely seen (1, 2, 3, 4) as a major problem for BSkyB - certainly it has been the primary focus for complaint from other operators (most notably Virgin, but also BT, Setanta and others). It may be that Ofcom and the Commission conclude that Sky must change its behaviour in some ways, but there are reasons for the company to be sanguine. First, there is the all important issue of market definition, and then the determination as to whether Sky holds significant market power/dominant position on any relevant market. Ultimately, is it competiting fairly or not? It is notable that the company's practices have been subject to review before, and that conditions have been imposed on how it supplies content to other platforms. These conditions have gradually been relaxed over time (since the mid-1990s) as markets have developed, so that only the provision of Sky's premium content is regulated. It would seem peculiar if the authorities concluded now that some retrenchment was required.

    The big question today, however - the 'elephant in the room' or (as Emily Bell put it recently) the 'dinosaurs in the meteor storm' point - is what impact the emergence of new technologies, new economic models of content provision, and on-demand services will have on the entire sector.

    No comments:

    Older Posts