One for rivals, two for Sky

1 October 2008 By Una Galani Follow @ugalani

It could have been a terrible week for the British satellite broadcaster, but it didn t turn out too badly. Sure, it has been told to reduce its 17.9% stake in rival ITV. But Sky is only being asked not forced to give rivals better access to its most valuable content.

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Ofcom on Tuesday said that British payTV group BSkyB should broaden access for rivals to its premium content such as blockbuster movies and Premier League football, if it wants to avoid a costly referral to the Competition Commission.

In initial findings from a review into the payTV market, the UK media regulator said that it believed Sky had dominant power in the wholesale markets, and an incentive to limit the supply to rivals.

Ofcom launched the PayTV investigation in 2007 after receiving complaints from rivals including BT, Setanta, Top Up TV and Virgin Media, who had requested Sky's referral to the Competition Commission and a structural separation of Sky into a retail and wholesale distribution business.

Earlier in the week, Sky was told it must reduce its 17.9% stake in ITV to below 7.5%. The Competition Commission Appeal Tribunal upheld a decision made in December, and supported Virgin Media's argument that the initial ruling had been too lenient.

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