UPDATE2 BT and Sky in Fresh UK Competition Spat Over TV Sports Channel

The communications regulator, Ofcom, has opened a new competition probe after UK telecoms giant BT complained that the terms on which Sky (Sky Broadband) offered wholesale supply of its Sky Sports 1 and 2 TV channels to their rival YouView (IPTV) platform “amount to an abuse of dominance“.

The case, which was officially opened on 14th June 2013 (i.e. follows the lodging of a complaint by BT on 24th May 2013), alleges that Sky (BSkyB) had made the supply of its key sports channels conditional on BT offering wholesale access of its new BTSport content (launch news) to Sky’s own retail and satellite platform.

At present BTSport, among other things, has the rights to show 38 live Barclays Premier League football matches (including 18 top picks) and 69 live Aviva Premiership rugby games. BT recently confirmed that it would be offering this content for free to its broadband subscribers, which could weaken Sky’s dominance of sport content and steal away some of their broadband subscribers.

Ofcoms Statement

“As set out in section 25 of the Act, Ofcom may conduct an investigation where it considers there are reasonable grounds for suspecting that the Chapter II prohibition and/or the prohibition in Article 102 TFEU have been infringed. In addition to the Chapter II prohibition in the Act, Ofcom has the power to apply Article 102 TFEU in full.

Ofcom has now opened an investigation under section 25 of the Act into the matters raised by BT’s complaint and will consider whether Sky has abused a dominant position under UK and/or EU competition law.”

Normally such complaints and any relevant investigations can drag on for a long time but the imminent launch of BT’s new TV content, which could arguably be further disadvantaged by Sky’s restriction, has caused BT to request that Ofcom “consider whether it is necessary to act as a matter of urgency to grant interim measures relief“. A preliminary decision on this is expected in July 2013, which is just before the 1st August 2013 launch of BTSport.

Meanwhile BT has said that it was “pleased” with Ofcom’s move “because they have refused to provide Sky Sports 1 and 2 to BT on YouView on fair terms whilst providing them to other pay TV retailers such as TalkTalk“. BT added that they would continue to try and resolve the situation through commercial negotiations but in the meantime have asked Ofcom to “take urgent action“.

UPDATE 11:21pm

Added some more remarks from BT to the bottom.

UPDATE 20th June 2013

Separately Ofcom has today ruled on a semi-related BT complaint, which claimed that Sky had breached the Code on the Prevention of Undue Discrimination between Broadcast Advertisers by not allowing the telecoms giant to broadcast advertisements for its BTSport channels on the Sky Sports channels.

The regulator ruled that “Sky is pursuing a legitimate commercial interest” and that the effect on BT would have been “limited“. Ofcom further said that “Sky’s approach is proportionate to its aim” and found that the satellite broadcaster had not “unduly discriminated” against BT. The full report can be found here (PDF).