BSkyB is to face no action from regulators over its monopoly of UK pay-TV film rights, after the Competition Commission decided that video on demand rivals such as LoveFilm and Netflix provide a vibrant market for consumers.Now normally I would be on VM’s side here, but, as we’ve seen when Sky was forced to share Premiership football with another broadcaster (Setanta/ESPN) these things don’t always benefit the paying customer even if it does eliminate a monopoly. Where once you could get all your Premiership games from Sky for a single price you now have to subscribe to ESPN too (on Sky at least). If that happened with the movie channels we could find ourselves in a situation similar to the States where you have to take multiple premium priced services to have access to the five big Hollywood studios movies, costing the customer considerably more than we pay here. The current arrangement works well – if you are just an occasional movie watcher you probably just need the films broadcast on the Freeview channels, if you want first run you go to either FilmFlex on a pay per movie or subscribe to Sky Movies. If we had to pay for, say, Sky Movies for Warner Bros movies but VM Movies for Universal and Sony films, that would be a mess.
The decision marks a U-turn by the competition regulator, which provisionally determined last August that BSkyB's contracts with the six major Hollywood studios – were anti-competitive and needed to be weakened to allow rivals to flourish.
"Virgin Media strongly disagrees with today's provisional findings by the Competition Commission and continues to support its earlier findings of 2011 – that Sky's control of movie rights is restricting competition in the UK," said a spokeswoman for Virgin Media.
"The recent emergence of providers such as LoveFilm and Netflix has done nothing to impact Sky's advantage and we're currently working to better understand the reasons for the commission's decision as we consider next steps.
"The commission states very clearly in these provisional findings that competition in the wider pay-TV retail market remains ineffective."
I can't believe VM is going to suddenly decide to invest in their own content again, so all I can suppose is that their complaining is more to do with reducing carriage fees for Sky Movies than any genuine demand to address a monopoly situation.