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Sky told to cut wholesale prices by regulator Ofcom 
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http://news.bbc.co.uk/1/hi/business/8596083.stm

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Regulator Ofcom has told Sky it must cut the price it charges rival cable, terrestrial and internet broadcasters to show its premium sports channels.

The broadcaster will have to sell Sky Sports 1 and 2 for up to 23% less than the current wholesale price.

The decision- part of the result of a three-year inquiry - aims to offer viewers more choice of pay-TV services.

Sky said it would appeal against the "unwarranted intervention", arguing it would be to the detriment of consumers.

"This is a marketplace where customers are well served with high levels of choice and innovation," Sky said.


Consumers will in the future enjoy a greater range of innovative services following fresh investment by competing pay-TV providers
Ofcom

"Consumers will not benefit if regulators blunt incentives to invest and take risks."

Sky will have to sell Sky Sports 1 and 2 for £10.63 a month each - 23.4% less than at present. If the two channels are sold together, Ofcom has set a price of £17.14 - a discount of 10.5% on current wholesale charges.

Bodies representing rugby, football and cricket - which rely on lucrative TV rights deals - fear the proposals will mean less money going into sport.

A spokesperson for the English Premier League said it was "very disappointed" and was studying the findings carefully.

BT said it hoped to offer Sky Sports 1 and 2 cheaper than Sky in time for the start of the next football season.

But it added: "Ofcom should have gone much further than it did.

"They should have included all Sky Sports channels, not just two. The wholesale price for the two sports channels is higher than the regulator had previously suggested."

It also complained that Ofcom had not set a regulated price for HD channels.

'Innovative services'


Robert Peston
For Ofcom, the goal is to increase the availability of live sport so that, for example, it can be tapped by the millions who watch Freeview and in movies to see the development of on-demand services on broadband and other platforms.
Robert Peston, BBC business editor

Read Robert's blog in full

As part of what could be a major shake-up of the pay-TV industry, Sky has also been given permission to offer pay-TV services on Freeview, replacing Sky's current free channels.

This, however, is conditional on Sky implementing the wholesale part of the deal, Ofcom said. If it decides to offer movie channels on digital terrestrial, it must also offer these to competitors such as BT vision and Top Up TV, the regulator added.

The move could mean 10 million Freeview-only homes having access to premium sport such the Premier League for the first time.

Ofcom estimates this could lead to up to two million more people subscribing to premium TV channels in the next five years.

"Consumers will in the future enjoy a greater range of innovative services following fresh investment by competing pay-TV providers," it said.

The broadcast regulator also found that Sky's dominance in the supply of premium movies was restricting viewer choice, particularly when it comes to video-on-demand services.

However, it said it did not have the necessary powers to address these concerns and proposed referring the matter to the Competition Commission for them to look into.

Competitors had hoped that Ofcom would also set lower wholesale prices for film channels.

Ofcom's inquiry began in 2007 after BT, Virgin, Top Up TV and the now defunct Setanta, expressed concerns about Sky's dominance of the pay-TV industry. It has an estimated 85% of the market.

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Wed Mar 31, 2010 9:08 am
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I do enjoy it when someone tells Murdoch what he has to do.

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Wed Mar 31, 2010 9:10 am
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jonlumb wrote:
I do enjoy it when someone tells Murdoch what he has to do.

I can see the DEB being modified so that Ofcom no longer have power to regulate satellite services. :evil:

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Wed Mar 31, 2010 8:33 pm
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Amnesia10 wrote:
jonlumb wrote:
I do enjoy it when someone tells Murdoch what he has to do.

I can see the DEB being modified so that Ofcom no longer have power to regulate satellite services. :evil:


The Tories are going to scrap Ofcom after the election anyway...

http://www.theregister.co.uk/2009/07/06/cameron_ofcom/

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Wed Mar 31, 2010 9:09 pm
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So the Tories have sold the public out to Murdoch already! :shock:

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Wed Mar 31, 2010 10:04 pm
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Amnesia10 wrote:
So the Tories have sold the public out to Murdoch already! :shock:


As if there was ever any doubt. They've probably made arrangements to kill off most of the BBC too.

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Wed Mar 31, 2010 10:25 pm
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Linux_User wrote:
Amnesia10 wrote:
So the Tories have sold the public out to Murdoch already! :shock:


As if there was ever any doubt. They've probably made arrangements to kill off most of the BBC too.

That would be political suicide. The BBC may have its detractors but the public love the BBC the only issue is how it is funded.

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Wed Mar 31, 2010 10:36 pm
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Amnesia10 wrote:
the only issue is how it is funded.


Which gives them the perfect angle to attack it from.

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Wed Mar 31, 2010 11:04 pm
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Linux_User wrote:
Amnesia10 wrote:
the only issue is how it is funded.


Which gives them the perfect angle to attack it from.

And any policy that will harm the output of the BBC will come back to sting them. The Tories will find it next to impossible to rehabilitate their reputation if the BBC are commercialised and we end up with a trashy TV system like the US. They still have the reputation of the Nasty Party and to compound it with demolishing the BBC will harm them for years maybe decades.

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Wed Mar 31, 2010 11:17 pm
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