Media regulator demands that BSkyB make a 23.4% cut in price of Sky Sports 1 and 2 to rivals such as Virgin Media and BT
BSkyB must reduce the wholesale price at which it sells Sky Sports 1 and Sky Sports 2 to rivals such as Virgin Media and BT by 23.4% from the current £13.88 to £10.63 per subscriber per month. On the basis that most subscribers buy packages including the sports channels, the reduction for a bundle is 10.5% from £19.15 to £17.14.
Ofcom also said today that BSkyB is restricting the distribution of premium movie rights, with a knock-on effect for the subscription video-on-demand market, and is proposing to refer the issue to the Competition Commission.
Rivals such as BT and Virgin Media have promised to cut the prices that their users pay for Sky Sports channels, but are also concerned that BSkyB may be able to exploit loopholes in the ruling such as shifting key sports content to channels not covered by the ruling.
Ofcom said that it would counter any move by BSkyB if it tried to shift content to channels not covered by the ruling "to any material extent".
Ofcom has also said that BSkyB must offer wholesale high-definition versions of Sky Sports 1 and 2 to rivals but stopped at setting a price. Within minutes of the announcement this morning BSkyB confirmed that it would lodge an appeal with the CAT over what it regards an "unprecendented and unwarranted intervention".
March 31, 2010
OFCOM - the main headlines