Leading article: Free competition is in the best interests of viewers

Ofcom is right to seek to level the pay-TV playing field

Share
Related Topics

Whatever other faults might be laid at its door, one thing Ofcom cannot be accused of is cowardice. In challenging BSkyB's position in the pay-TV market, the regulator is taking on a business with formidable resources and awesome lobbying power.

But does the watchdog have a case? Ofcom suggests that BSkyB is distorting fair competition in the market by refusing to sell the rights to air its sports and movie channels to rival broadcasters. The anti-BSkyB argument, to put it crudely, is that the satellite broadcaster, having stitched up cosy deals with Hollywood studios and the Premier League, is determined to keep what it has acquired in its own hands so that anyone who wants to watch must pay a hefty satellite subscription fee.

The solution Ofcom proposes is to force BSkyB to make these channels available to rivals at set prices in order to boost competition in the pay-TV market. It also argues that these new requirements would not unduly penalise BSkyB because what the broadcaster might lose in subscription revenue would be made up, in part at least, from increased revenues from selling its content to rivals. BSkyB's competitors yesterday welcomed the move, saying it would bring down prices for viewers. BSkyB, not surprisingly, has pledged to fight the regulator all the way.

The contribution that BSkyB has made in sports broadcasting must not be overlooked. It has given an extraordinary boost to top-level British sport over the past two decades. Its revenues have swelled the coffers of Premier League clubs, helping top teams to attract some of the best players in the world and outside investment from various oligarchs, oil sheikhs and tycoons. The broadcaster has also offered a fair deal to British sport viewers. Despite the nostalgia of some fans, the days before BSkyB were hardly a golden age for televised sport.

We should also be wary of taking the complaints of BSkyB's competitors at face value. BSkyB had to take risks to get to where it is now. When Rupert Murdoch founded Sky in 1989, there were no guarantees that the British public would be willing to pay to watch television. The start-up costs were considerable and it took several years for the broadcaster to turn a profit. BSkyB is right when it argues that it should not be punished for being successful. And the fact that it makes large profits now does not mean it constitutes an abusive monopoly.

Yet BSkyB has clearly grown to dominate the pay-TV market. The plunge into administration of the sports broadcaster Setanta UK this month cannot be attributed solely to the power of its larger established rival. But BSkyB's dominance certainly played its part in the shambles of the Irish broadcaster's collapse. Setanta UK's owners made big mistakes, but they also had little choice but to take risks to have any hope of growing into a serious challenger to BSkyB.

Despite the Setanta debacle, it was right of the European Commission to rule in 2005 that the rights to air all the games of the Premier League should not go to a single broadcaster. And despite the tough fight that BSkyB will doubtless pose to this latest regulatory challenge, Ofcom is also right to attempt to level the playing field for any prospective competitor to BSkyB.

This is not about punishing success, but serving the consumer. Free competition offers the best deal for viewers. And in the UK pay-TV market, that competition does not, at present, look free enough.

React Now

Latest stories from i100
iJobs Job Widget
iJobs General

Recruitment Genius: Office Administrator

£14000 - £18000 per annum: Recruitment Genius: An Office Administrator is requ...

Recruitment Genius: Sales Executive - Commercial Vehicles - OTE £40,000

£12000 - £40000 per annum: Recruitment Genius: Due to expansion and growth of ...

Ashdown Group: Senior PHP Developer - Sheffield - £50,000

£40000 - £50000 per annum: Ashdown Group: Senior PHP Developer position with a...

Recruitment Genius: Operations Leader - Plasma Processing

Negotiable: Recruitment Genius: An Operations Leader is required to join a lea...

Day In a Page

Read Next
 

i Editor's Letter: Most powerful woman in British politics

Oliver Duff Oliver Duff
All the major parties are under pressure from sceptical voters to spell out their tax and spending plans  

Yet again, the economy is the battleground on which the election will be fought

Patrick Diamond
Revealed: Why Mohammed Emwazi chose the 'safe option' of fighting for Isis, rather than following his friends to al-Shabaab in Somalia

Why Mohammed Emwazi chose Isis

His friends were betrayed and killed by al-Shabaab
'The solution can never be to impassively watch on while desperate people drown'
An open letter to David Cameron: Building fortress Europe has had deadly results

Open letter to David Cameron

Building the walls of fortress Europe has had deadly results
Tory candidates' tweets not as 'spontaneous' as they seem - you don't say!

You don't say!

Tory candidates' election tweets not as 'spontaneous' as they appear
Mubi: Netflix for people who want to stop just watching trash

So what is Mubi?

Netflix for people who want to stop just watching trash all the time
The impossible job: how to follow Kevin Spacey?

The hardest job in theatre?

How to follow Kevin Spacey
Armenian genocide: To continue to deny the truth of this mass human cruelty is close to a criminal lie

Armenian genocide and the 'good Turks'

To continue to deny the truth of this mass human cruelty is close to a criminal lie
Lou Reed: The truth about the singer's upbringing beyond the biographers' and memoirists' myths

'Lou needed care, but what he got was ECT'

The truth about the singer's upbringing beyond
Migrant boat disaster: This human tragedy has been brewing for four years and EU states can't say they were not warned

This human tragedy has been brewing for years

EU states can't say they were not warned
Women's sportswear: From tackling a marathon to a jog in the park, the right kit can help

Women's sportswear

From tackling a marathon to a jog in the park, the right kit can help
Hillary Clinton's outfits will be as important as her policies in her presidential bid

Clinton's clothes

Like it or not, her outfits will be as important as her policies
NHS struggling to monitor the safety and efficacy of its services outsourced to private providers

Who's monitoring the outsourced NHS services?

A report finds that private firms are not being properly assessed for their quality of care
Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

The Tory MP said he did not want to stand again unless his party's manifesto ruled out a third runway. But he's doing so. Watch this space
How do Greek voters feel about Syriza's backtracking on its anti-austerity pledge?

How do Greeks feel about Syriza?

Five voters from different backgrounds tell us what they expect from Syriza's charismatic leader Alexis Tsipras
From Iraq to Libya and Syria: The wars that come back to haunt us

The wars that come back to haunt us

David Cameron should not escape blame for his role in conflicts that are still raging, argues Patrick Cockburn
Sam Baker and Lauren Laverne: Too busy to surf? Head to The Pool

Too busy to surf? Head to The Pool

A new website is trying to declutter the internet to help busy women. Holly Williams meets the founders