Murdoch's hold over pay TV under attack

Furious UK cable companies have complained to the Office of Fair Trading and competition authorities in Brussels over Rupert Murdoch's control of the pay TV market in Britain.

A formal complaint has been launched with the European Commission asking that agreements signed between BSkyB, the satellite and cable broadcaster 40 per cent owned by Mr Murdoch's News Corp, and two UK cable companies be overturned on the grounds that they restrain trade.

The OFT has also been asked to look at the contracts, and has formally requested copies from Nynex CableComms and TeleWest, two large cable companies.

Mr Murdoch's pay TV woes came to a head just as he confirmed to an Italian newspaper that he was prepared to buy outright Silvio Berlusconi's three commercial television stations in Italy.

The cable company contracts were signed earlier this month. A copy of the Nynex contract, seen by the Independent, enjoins Nynex from investing in or carrying products that compete directly with Sky programming. In exchange, the company receives advantageous rates for the carriage of Sky's movies, sports and general interest channels.

Sky's rates and programming packages for cable companies were the subject of an informal undertaking from BSkyB earlier this year, following complaints from the cable industry. The OFT and BSkyB agreed that cable companies could buy Sky services a la carte, and that a standard rate card would be established. BSkyB offered to provide programming at a discount for companies willing to sign a fixed-price agreement.

CableTel is leading the battle against BSkyB. Its chief operating officer, Steven Wagner, said yesterday that "companies operating without a fixed contract are facing large increases" in the amount they must pay BSkyB for programming. Mr Wagner said his costs would rise 20 per cent, which he would have to pass on to customers.

Several other cable companies are supporting CableTel's complaint. They argue that BSkyB's control over encryption technology, by which television signals are scrambled and unscrambled, gives it a gatekeeper role in pay TV. In addition, they complain that Mr Murdoch's arrangements with Astra, the satellite company, restrict access to the UK market for other players. Finally, they believe Mr Murdoch has secured key programming rights at high prices, limiting the amount of non-Sky broadcasts available to the cable industry.

In an effort to build alternative sources of programming, several cable companies, including CableTel, Nynex and TeleWest, together secured rights to various programmes. Some were sold to Mirror Group when it decided to launch LiveTV. The remainder of rights have been retained by a joint venture established by the consortium of cable companies.

Earlier this week, Nynex refused to continue to finance the alternative package beyond 31 May. TeleWest said it would consider extending its funding role only if the cable companies brought in BSkyB as a partner.

Meanwhile, Mr Murdoch's intentions toward Mr Berlusconi's TV empire became clearer yesterday. He told the Turin daily La Stampa that as far as he was concerned Mr Berlusconi had already decided to sell everything. Mr Murdoch was interested in buying as many television stations as he could get hold of, or failing that a share in the business as a whole.

Arts & Entertainment
Madonna in her music video for 'Like A Virgin'
music... and other misheard song lyrics
News
Waitrose will be bringing in more manned tills
newsOverheard in Waitrose: documenting the chatter in 'Britain's poshest supermarket'
News
The energy drink MosKa was banned for containing a heavy dose of the popular erectile dysfunction Levitra
news
News
Much of the colleges’ land is off-limits to locals in Cambridge, with tight security
educationAnd has the Cambridge I knew turned its back on me?
VIDEO
Sport
Australia's Dylan Tombides competes for the ball with Adal Matar of Kuwait during the AFC U-22 Championship Group C match in January
sportDylan Tombides was diagnosed with testicular cancer in 2011
News
Ida Beate Loken has been living at the foot of a mountain since May
newsNorwegian gives up home comforts for a cave
Extras
indybest10 best gardening gloves
News
Russia's President Vladimir Putin gives his annual televised question-and-answer session
peopleBizarre TV claim
Arts & Entertainment
tvIt might all be getting a bit much, but this is still the some of the finest TV ever made, says Grace Dent
Arts & Entertainment
Comedian Lenny Henry is calling for more regulation to support ethnic actors on TV
tvActor and comedian leads campaign against 'lack of diversity' in British television
News
Posted at the end of March, this tweeted photo was a week off the end of their Broadway shows
people
News
peopleStar to remain in hospital for up to 27 days to get over allergic reaction
Arts & Entertainment
The Honesty Policy is a group of anonymous Muslims who believe that the community needs a space to express itself without shame or judgement
music
News
Who makes you happy?
happy listSend your nominations now for the Independent on Sunday Happy List
Life & Style
life
Have you tried new the Independent Digital Edition iPad app?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

1st Line Helpdesk Engineer Apprentice

£150.00 per week: QA Apprenticeships: This company has been providing on site ...

Telesales & Sales Support Apprentice

£221.25 per week: QA Apprenticeships: This company is a well established Inter...

Client Relationship Manager - SQL, Python

£40000 - £50000 per annum: Harrington Starr: Client Relationship Manager - SQL...

**Financial Services Tax**

£35000 - £50000 per annum: Pro-Recruitment Group: Take your chance to join the...

Day In a Page

How I brokered a peace deal with Robert Mugabe: Roy Agyemang reveals the delicate diplomacy needed to get Zimbabwe’s President to sit down with the BBC

How I brokered a peace deal with Robert Mugabe

Roy Agyemang reveals the delicate diplomacy needed to get Zimbabwe’s President to sit down with the BBC
Video of British Muslims dancing to Pharrell Williams's hit Happy attacked as 'sinful'

British Muslims's Happy video attacked as 'sinful'

The four-minute clip by Honesty Policy has had more than 300,000 hits on YouTube
Church of England-raised Michael Williams describes the unexpected joys in learning about his family's Jewish faith

Michael Williams: Do as I do, not as I pray

Church of England-raised Williams describes the unexpected joys in learning about his family's Jewish faith
A History of the First World War in 100 moments: A visit to the Front Line by the Prime Minister's wife

A History of the First World War in 100 moments

A visit to the Front Line by the Prime Minister's wife
Comedian Jenny Collier: 'Sexism I experienced on stand-up circuit should be extinct'

Jenny Collier: 'Sexism on stand-up circuit should be extinct'

The comedian's appearance at a show on the eve of International Women's Day was cancelled because they had "too many women" on the bill
Cannes Film Festival: Ken Loach and Mike Leigh to fight it out for the Palme d'Or

Cannes Film Festival

Ken Loach and Mike Leigh to fight it out for the Palme d'Or
The concept album makes surprise top ten return with neolithic opus from Jethro Tull's Ian Anderson

The concept album makes surprise top ten return

Neolithic opus from Jethro Tull's Ian Anderson is unexpected success
Lichen is the surprise new ingredient on fine-dining menus, thanks to our love of Scandinavian and Indian cuisines

Lichen is surprise new ingredient on fine-dining menus

Emily Jupp discovers how it can give a unique, smoky flavour to our cooking
10 best baking books

10 best baking books

Planning a spot of baking this bank holiday weekend? From old favourites to new releases, here’s ten cookbooks for you
Jury still out on Manchester City boss Manuel Pellegrini

Jury still out on Pellegrini

Draw with Sunderland raises questions over Manchester City manager's ability to motivate and unify his players
Ben Stokes: 'Punching lockers isn't way forward'

Ben Stokes: 'Punching lockers isn't way forward'

The all-rounder has been hailed as future star after Ashes debut but incident in Caribbean added to doubts about discipline. Jon Culley meets a man looking to control his emotions
Mark Johnston: First £1 million jackpot spurs him on

Mark Johnston: First £1 million jackpot spurs him on

The most prize money ever at an All-Weather race day is up for grabs at Lingfield on Friday, and the record-breaking trainer tells Jon Freeman how times have changed
Ricky Gervais: 'People are waiting for me to fail. If you think it's awful, then just don't watch it'

Ricky Gervais: 'People are waiting for me to fail'

As the second series of his divisive sitcom 'Derek' hits screens, the comedian tells James Rampton why he'll never bow to the critics who habitually circle his work
Mad Men series 7, TV review: The suits are still sharp, but Don Draper has lost his edge

Mad Men returns for a final fling

The suits are still sharp, but Don Draper has lost his edge
Google finds a lift into space will never get off the ground as there is no material strong enough for a cable from Earth into orbit

Google finds a lift into space will never get off the ground

Technology giant’s scientists say there is no material strong enough for a cable from Earth into orbit