Ofcom UK Probes Sky TV Over End-of-Contract Notifications UPDATE

The UK communications and media regulator, Ofcom, has launched a new investigation into Sky (Sky Broadband) over their apparent refusal to issue end-of-contract notifications to Pay TV customers. At issue is whether or not Sky’s standalone Pay TV services fall within the definition of an “electronic communications service“.

Back in February 2020 Ofcom launched a new End-of-Contract Notifications system, which requires all fixed broadband, mobile, home phone and pay TV providers to issue such notifications to existing subscribers (sent by text, email or letter). The move was intended to help tackle the so-called “loyalty penalty” by keeping customers informed about the best deals and encouraging switching.

Specifically, the rules state that these notifications must be sent to customers of all public “electronic communications services” other than machine-to-machine (M2M) transmission services. Ofcom considers that, as a provider of Pay TV services transmitted by a satellite network, Sky provides an electronic communications service and must therefore send end-of-contract notifications to its TV customers.

However, the regulator states that Sky “does not consider that its standalone pay-TV services fall within the definition of an electronic communications service” and therefore believes the obligation to send such notifications “does not apply“.

Ofcom’s Statement

Sky does not consider that its standalone pay-TV services fall within the definition of an electronic communications service and maintains it is not required to comply with GC 1.10 for such services.

Following discussions with Sky, we accept that there is a genuine difference of opinion as to the legal interpretation and scope of the term ‘electronic communications service’. We have therefore decided to open an investigation to examine whether there are reasonable grounds to believe that Sky has failed to comply with its obligations under C1.10.

A Sky Spokesperson told ISPreview.co.uk:

“We welcome Ofcom’s plans to review our position and are pleased to have the opportunity to clarify what has been a long running difference of views on interpretation of the law. We cannot comment further until Ofcom has announced its decision.”

The regulator has always been very clear about the fact that Pay TV providers were covered by their scheme, thus it will be interesting to see how much water Sky’s counter-argument ends up holding. Ofcom expects to determine its next steps by January 2021.

UPDATE 12:13pm

We believe the core of this issue centres on how an ‘electronic communications service’ is defined in section 32 of the 2003 Communications Act, where it says: “a service consisting in, or having as its principal feature, the conveyance by means of an electronic communications network of signals, except insofar as it is a content service.”

Sky’s point of contention is over the bit where it says, “except insofar as it is a content service.” As such Sky appear to be contending that content services (such as broadcast services) are exempt from the regulation, although this may be harder to argue in today’s modern age of digital connectivity than it was in the old analogue era.

Meanwhile Ofcom will most likely be arguing that it is the transmission of content that constitutes an ECS, and there is no reason why a retail package as a whole has to be either one type of service or the other. We’re inclined to agree with the regulator on this one.