BSkyB's 18% price rise angers bar and pub operators

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The Independent Online

The pubs and bars industry is to take a new complaint about broadcasting company BSkyB to regulators, after the satellite television operator hiked subscription prices for licensed premises by 18 per cent.

The British Beer and Pub Association (BBPA) said it had begun gathering evidence and case studies that it will present to the Office of Fair Trading in the next few weeks.

Earlier this week an Early Day Motion called on the satellite group to review its "pie in the Sky" price jump. The screening of sports events is a key attraction to pubs and BSkyB is the only supplier of highly rated sports content, including live Premiership football. The broadcasting group has been the subject of many regulatory investigations over the years, including examinations of its pricing policy, but the company has never been found guilty of anti-competitive practices.

Most recently, in December, the Office of Fair Trading concluded a three-year investigation into the wholesale rates that Sky charged other pay-TV operators for its content. While the watchdog found in Sky's favour, it was careful to say that its decision was "borderline".

Earlier in 2002, it had investigated a complaint on pricing from pubs groups but this too did not lead to a finding against Sky, which is screened in 30,000 pubs, bars and clubs across the country.

Mark Hastings, of the BBPA, said: "The last time the OFT looked at Sky, it was a 'borderline' case. We believe this [price hike] has taken it over the borderline."

Sky wrote to pubs in recent weeks to inform them of a price increase of about 18 per cent - its charges vary, depending on the size of the premises.

The hike takes effect on 1 September and will mean, for example, that the "average local" pub will see the monthly price of a Sky subscription rise from £399 to £488.

The increase comes as Sky is thought to have been forced to bid much higher than expected for the next Premiership rights contract, with an offer of around £1bn for a three-year deal, running from 2005.

A Sky spokesman said: "Ultimately, pubs and clubs have a choice of which entertainment they offer customers.

"We believe our pricing reflects the value of our product and the value it adds to our customers' trade."