Branson Vs Murdoch: Round Five
The dispute between rival broadcast giants Virgin Media and BSkyB has taken yet another turn, with Sky claiming that it does want its channels to be available to Virgin Media customers.
Earlier today, Virgin Media released a statement insisting that Sky was about to pull its basic package of channels from the newly launched quadruple-play operation by the end of this month, after negotiations to sign a new contract for the services broke down (see Sky Channels To Be Removed From Virgin Media).
The breakdown in communications suggested that from the end of the month, Virgin Media would no longer have the rights to broadcast Sky One, Sky Two, Sky Three, Sky News and Sky Sports News although, currently, it still holds the contracts to broadcast Sky’s sport and movie channels.
In a statement, a Sky spokesman hit back, saying: “With several days remaining and active discussions continuing, we’re surprised and disappointed that NTL/Virgin chose to attack Sky and suggest, prematurely, that their customers will miss out on Sky basic channels from 1 March.”
The broadcaster said that it wanted Sky basic channels, including Sky One, Sky Two, Sky Sports News and Sky News, to remain available to NTL/Virgin customers. It also said that it had been willing to offer more to Virgin Media customers than it ever had, including HD services and new channels such as Sky Three and Sky Arts, the UK’s only dedicated arts channel.
The spokesman added: “Unlike the open satellite platform, NTL/Virgin’s cable network is closed. The only way Sky’s channels can be available to cable viewers is if NTL/Virgin chooses to carry them.
“NTL/Virgin can’t expect to free-ride on Sky’s commitment to bring viewers the best TV. They need to decide whether they are going to invest in the programmes that their customers enjoy.”
In a statement released earlier, Virgin Media had said: “The nature of these negotiations leads us to believe that this outcome has been deliberately engineered by Sky in order to suppress competition and coerce Virgin Media’s customers into switching to its service by denying them access to the basic channels.
“This view is reinforced by Sky’s decision to broadcast, at the height of negotiations on February 12, a series of promotions claiming that the channels were about to disappear from Virgin Media’s network. This was nothing more than a heavy-handed attempt to exert undue influence on the negotiating process.”
Virgin Media said that negotiations are ongoing and it would continue to, “seek an agreement on terms that make commercial sense for both parties. However, as things stand, Sky’s demands offer no prospect of us being able to reach a commercially viable agreement to continue carriage of these channels on Virgin Media’s platform.”
The broadcaster said that if Sky withdraws its channels, it would divert any money saved into continuing the transformation its television service with “an extensive range of new channels and programming. This will include further additions to our existing on-demand library and ensure our television service more than matches anything on offer from Sky.”
Steve Burch, president and chief executive of Virgin Media, said: “Throughout its history, Virgin has challenged the attempts of dominant corporations to manipulate markets, stifle competition and dictate consumer choice. It has done so simply by giving consumers a better deal and Virgin Media is going to do the same. Sky’s behaviour is a heavy-handed and anti-competitive response to that challenge and consumer choice has been reduced as a result. I’m pleased, however, that at a time when they’re taking content away, Virgin Media is giving people more.”
Sky launched adverts on channels such as Sky One earlier in the month. Customers of the newly branded Virgin Media (see Virgin Media Launches Today) were told that Sky’s basic channels could be withdrawn from the cable system if Virgin Media did not pay a “fair price for them” (see Branson Vs Murdoch: Round Three).
The latest in the Branson Vs the Murdochs saga has erupted essentially as a follow on from Virgin’s complaints to regulators after Sky effectively blocked the cable company’s takeover bid for ITV (see BSkyB Chief Exec Defends Company’s Swoop On ITV Shares).
BSkyB: www.sky.com Virgin Media: www.virginmedia.com