Media: The battle to rule over the airwaves

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The Independent Online
THE OFFICE of Fair Trading's assault on BSkyB and the Premier league is only one of a number of regulatory battles being fought out in the communications industry at present. Oftel, the telecoms regulator, is looking at how telephone carriers charge each other to use their lines into peoples' homes and the Monopolies and Mergers Commission is yet to judge on BSkyB's bid for Manchester United. The most interesting battle isn't between regulators and companies, but between different regulators to see who will be communications supremo.

Evidence of this was seen three weeks ago when the Financial Times ran a front page story about how the Independent Television Commission was opposed to BSkyB being allowed to buy Manchester United. The purchase of the Reds is nothing to do with the ITC, but is evidence of how it is trying to prove itself as a financial regulator. The story almost certainly emerged from a series of lunches, held by one of the ITC's most senior staff, with journalists to put their case for its competence as an economic regulator. The Government has published a Green Paper asking for views on the future of telecoms and television regulation. With the development of interactive services, cable television companies that are phone companies and Internet access through the TV screen, it seems increasingly strange to have separate regulators for what is increasingly the same business. But this is not how the ITC sees it and the ITC is scared of being squeezed out by Oftel - hence its ham-fisted intervention in the United deal. It wants to prove it can work with the other regulators and has already flexed its economic muscles. It ordered the cable companies to unbundle some programme packages to stop viewers having to subscribe to large packages of channels. "That gave the ITC balls, especially when they were sued by Flextech and the Sci-Fi Channel, but won," says one senior media analyst.

Since then, the ITC has submitted its response to the Green Ppaper outlining a case for the status quo, with the ITC, Oftel and the OFT working together when they need to - as they did when BSkyB was kicked out of the bid for the digital terrestrial multiplex.

The ITC believes the cultural and political importance of television means it cannot be regulated in the same way as people sending computer data down a phone line is. The whole affair is as dry as dust to the outside observer - it is a battle of the acronyms - but given that the words television, monopoly and regulation inevitably seem to appear in the same sentence as Rupert Murdoch and BSkyB, the outcome of this boring battle could be very interesting indeed.