Ofcom wants to impose a complicated pricing formula which it claims will allow Sky to make a decent margin from selling on its sport and movie channels, even after the cost of acquiring the rights has been taken into account.
"It would not make Sky sell at a loss," Patterson [Chief Exec of BT Retail] says. It is ironic, he adds, that Sky has built a broadband business with more than 2 million customers (BT has close to 5 million) by piggybacking on BT's own network, following a deal imposed by regulators, but is unwilling to accede to Ofcom's writ by making its own content available to BT and others.
I hadn't thought of it like that. Sky has talked up the investment made by the company in securing its premium TV content monopoly, but has conveniently ignored the similar situation in the broadband market with BT having made a huge investment and then having to bow to regulatory power to open it up to the competition. Which Sky has been one of the main beneficiaries of.