[Ignitionnet]

Originally Posted by TheDon

Amazing how the countries that they still have a market presence in they don't have a Sky like force to compete with isn't it?

Like Northern Ireland and Eire, both of whom have full Sky services available?

Setanta's screw up was assuming that if they paid Sky-rates for the content they'd get sky-level subscriber numbers.

Instead they came up against the complete un-willingness for subscribers to subscribe to multiple sports channels.

Setanta's business model was only unrealistic because of Sky being such a dominant force meaning that customers who are used to getting all their premium content in one channel package didn't want to subscribe to any others so they couldn't reach the subscriber numbers needed to make it profitable.

They overpaid due to the competition for the rights from various other parties including apparently the BBC and some company called Virgin Media.

Source that VM don't want to pay for them?
As everything in the ofcom consultation says they DO want to pay for them, just at a level where they can actually offer competitive pricing on them without losing money.

Ofcom should go further, the vertical integration of services and platforms should be banned, and companies broken up so all platforms have access to all content on a level playing field.

A bad choice of words on my part, I should have mentioned they don't want to pay the current rates for them. VM appear to have no problems cross-subsidising in some ways, for example ESPN being free to XL TV. VM chose to advertise Sky Sports for less than Sky, their decision.

If they have so much trouble with Sky Sports they have always had the option of removing it from their packages and allowing Sky to take the commercial risks associated with it in a similar manner to how Homechoice delivered Sky content.

Breaking up companies in the manner you describe would be an amazingly bad idea that would lead to no-one investing in content due to the uncertainty of where they would find their return, it would also make things amazingly confusing to subscribe to.

As far as vertical integration goes, the most vertically integrated would actually be Virgin Media, given that they produce some of their content, own the network is runs on, the CPE, billing, etc. Sky rent capacity on the SES Astra satellites which anyone else can do, and run an open platform on their EPG, unlike Virgin Media whose network is totally closed.

Doing what Ofcom are doing doesn't actually do anything to preventing or discouraging vertical integration, it merely discourages investment in content. Seems to me that Ofcom just want to punish Sky for being too successful.

Had ntl and Telewest been able to compete better in the 90s, not killed themselves massively overspending acquiring networks at .com boom prices, and therefore had more cash they would probably be in the same situation Sky are, but they aren't. They screwed up, Sky didn't as badly, so now Sky are expected to allow them the benefits of their investment in content.

---------- Post added at 13:04 ---------- Previous post was at 13:02 ----------

Originally Posted by martyh

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but as has been pointed by Broadbandings sky's monopoly was ended a few years ago as regards premiership football coverage so why didn't /couldn't setanta take advantage of this ,give potential customers what they wanted like red button access to matches ,decent commentators ,if the only reason lack of funds then that's hardly sky's fault

Part of the issue with Setanta was that their productions were, initially, garbage. Comparing the poor picture quality and at times amateurish production with the slick, extremely well run Sky operation was probably another major issue.

It's worth noting that a lot of issues Setanta had weren't with getting customers but retaining them. They had a lot of teething trouble with their hardware and bit rates which turned people used to high picture quality games from Sky off in a massive hurry.

http://www.cableforum.co.uk/board/11...s-picture.html
http://www.digitalspy.co.uk/forums/s...d.php?t=621915