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July 10, 2015

BT vs Sky: Ofcom called to review pay-TV dominance

One month after CBR reported BT CEO demanding a level playing field, the telco giant calls on Ofcom to act.

By James Nunns

The on-going battle for the UK pay-TV market is heating up with BT calling on Ofcom to broaden its Digital Communications Review.

Addressing Sky’s dominance of the market, BT is hoping that the regulator will tackle the low levels of switching seen.

John Petter, chief executive, BT’s consumer division, said: "Whereas in the energy market regulators have criticised the Big Six operators, in pay-TV Sky has a 64% share, so there really is only the Big One."

The opening salvos were fired back in June when CBR reported BT CEO Gavin Patterson telling a London conference: "We would argue that there are certain parts of the market where there is a dominant player – Pay TV – that does not have the same expectations and restrictions that BT has to work with. When customers increasingly buy in bundles, the difference becomes extremely blurred between a Pay TV-led bundle and a telco-led bundle," he said.

He added: "I really hope we use this as an opportunity to remove regulation where the world has moved on."

With switching levels in pay-TV 50% lower than levels seen in broadband, Petter now argues that there aren’t the right levels of competition.

Sky rebutted, saying: "The reality is that, in a competitive market, customers are choosing Sky in greater numbers and staying with us for longer because of the quality and value that we offer."

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In recent months, Sky has called on the regulator to take away the national broadband network, Openreach, from BT ownership.

Sky said that it believed this request from Ofcom to address the pay-TV market is, "An attempt to deflect attention from the real problems that exist in broadband, where customers are suffering because of BT’s underinvestment and there is a concern about competition in the future."

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