OFT Issues Terms For Inquiry Into Dominance Of BSkyB

The Office of Fair Trading has issued the terms of reference for its review into BSkyB’s position in the pay-TV market. The inquiry was announced in January to ensure that regulation of the broadcaster remains appropriate to the changing marketplace, and that effective competition within the industry is protected (see OFT To Review BSkyB’s Position In Pay-TV Market).

The inquiry will question BSkyB’s dominance within the market and assess whether this power is abused. In particular its relationship with the cable industry, to which it provides channels for onward broadcast, will be considered.

BSkyB hopes to see regulation regarding its supply of content relaxed, claiming that recent consolidation within the cable industry has created powerful rivals. The broadcaster is currently obliged to supply content to both cable platforms and digital terrestrial broadcaster ONdigital. With the development and increased competitiveness of these rival platforms, Sky argues that it should be able to protect its content from its competitors (see Cable Merger Could Lead To Open Networks).

Cable groups and ONdigital, however, are calling for a reduction in the current levy paid for Sky channels to allow greater access to premium television products.

The inquiry is now inviting comment from broadcasters and other interested parties. Full details can be found at www.oft.gov.uk.

Office of Fair Trading: 020 7211 8000