[Ignitionnet]

Originally Posted by Horace

Open as in the case of Sky "pay us enough and we might just let you onto our EPG"

Nope BSkyB have no say in what goes on their EPG, that's a condition of their Ofcom operating licence. Comply with the technical details, etc, and there's nothing Sky can do about it.

Freesat wasn't set up for the fun of it - and in the case of BT "our infrastructure was built by the taxpayer and we had to be legislated into giving access".

As I said above BT's next generation access network they voluntarily made open. This access network is either in no way built by the taxpayer or very little of it. That the taxpayer built the original network is also irrelevant it's the issues around replicating that infrastructure, it is a structural monopoly that are the reasons for the original legislations. BT wasn't just handed from government control to private control - they paid for it!

Virgin are the only one of the three to have built their own infrastructure and continue to pay for that investment via (frozen) interest payments.

So what? Legislation appears to be perfectly acceptable on Sky to prevent them having a monopoly, so what does who built what, where, why and how have to do with things? Sky's platform was built with entirely private money, why should they be regulated if whomever built the networks is relevant. Virgin Media do, after all, have a total monopoly on cable access and in some areas a monopoly on high speed internet access. They are always talking about how superior their network is, surely it would be in the public's best interest to have more choice over that superior network? Infact the only party to whom it wouldn't be in the best interest is Virgin Media. They have the only large non-open distribution network in the UK.

Requiring allowing of access to cable networks is certainly not without precedent. It's happening now in the Netherlands for TV content and in the United States access to cable networks for 3rd party ISPs was done as long as 9 years ago. Then there is that ntl were wholesaling access to their cable network a while ago, albeit at extremely inflated prices which only one operator was stupid enough to pay.

Also, it's no surprise OFCOM gives seemingly unfair support to cable since without it SKY would have a complete monopoly in pay-tv in the U.K. It's also no surpise that organisations are full of Labour sympathisers, the same happened, and will again, when the Conservatives were in power for a long period.

Ofcom isn't just full of Labour sympathisers, it's full of Labour advisors, donors, etc. Stephen Carter leaves his jumped up PR position at ntl and goes to Ofcom then leaves there to come work for the government. Ed Richards his successor used to work for the government. That goes beyond sympathising to loading up the regulator for political reasons, and rest assured Ofcom have a strong policy role. They also appear to be lining up a nice lucrative spectrum auction, once again taking money from private enterprise, which we will have to pay back in higher bills, and putting it into government coffers, which is nice.

On the subject of monopolies Sky are already required to wholesale a large number of their channels, and if BT and VM want the content so badly why don't they simply bid for it themselves? The whole fear that if Ofcom don't force Sky to sell their channels cheaper there will be some kind of monopoly is ridiculous. No-one is stopping BT and VM from putting their hands in their pockets and bidding. If they are too scared to bid on their own they could form a conglomerate and put in a combined bid. If they are still too scared to sink their own money into the bidding process they obviously don't want the content that badly if they'd rather Sky bear the risk.

Easy to think of VM as aggrieved however if they think there is a demand for these channels they can simply pay for them, Sky did offer to discount substantially from previous levels however I believe Ofcom refused that deal on behalf of VM and everyone else as Sky wanted to sell pay-tv over DTT in return. If they think the price is unreasonable they negotiate. If they still can't get anything out of the deal they look into allowing Sky to sell the channels on their platform and charge Sky for access to their platform. This way they get to take none of the risk and can advertise the HD availability, however I guess due in no small part to the 'politics' between the two companies that isn't going to happen which is a shame. Homechoice had Sky channels which were sold by Sky and transported on their platform and it's a very common arrangement in a number of countries across many different cable networks and DTH platforms including Sky's own where ESPN et al are sold distinctly from Sky so I'm not sure what the issue is beyond the politics and/or VM not wanting to set precedent through allowing other operators any kind of access to their network.

This whole thing is about Ofcom wanting to shape the market to fit their view of how it should be, it's nothing to do with fostering choice or fair competition. Going by how well things went last time Ofcom did this with a market - broadband - I wouldn't feel too optimistic. Ofcom's enforced competition just left us with several hundred varieties of crap to choose from, LLU offerings largely centred around reducing costs rather than improving services, and no-one wanting to make serious investment in next generation technologies to compete with cable until this year.

If you want some more idea about how prejudiced against Sky this remedy is Sky will be obliged to offer the channels at a retail minus basis. In other words the more efficient Sky are and the lower they keep the prices to their own consumers through things like more automation, more use of online resource, etc, the less they get for the channels, punishing them for trying to keep their own consumers' prices down. This is ridiculous as it assumes a similar level of efficiency from whomever buys the channels, and everyone who buys them from a Virgin Media or BT right down to Smallworld pays the same. In addition when Sky come to increase their retail prices that means they increase the wholesale ones as well right? Nope, they have to seek consent from Ofcom before the wholesale price goes down and in any event Ofcom have a pricing system of how they want the charges to go in the future anyway. Under this system it's perfectly feasible that Virgin Media will be able to rebroadcast Sky's channels for less than the cost of making them.

But hey, it's Sky right? Monopoly, evil Rupert Murdoch, must be stopped at all costs. Which is fine except when a body that's supposed to foster competition is the one doing the stopping at all costs. Maybe a remedy is needed, maybe other operators just need to grow a pair and start bidding with Sky for the new content and either let Sky sell on their platform directly or pay up, either way this remedy that Ofcom want to employ is really very OTT. Who'd have thought a Labour dominated regulator would be overbearing and want to control everything because they know best