Ofcom Finds Sky UK Breached Rules on Contract Notifications UPDATE

A long-running investigation by the UK telecoms and media regulator, Ofcom, has today concluded that Sky (Sky TV, Sky Broadband etc.) broke consumer protection rules by failing to send end-of-contract notifications to their satellite based Pay TV customers.

The End-of-Contract Notifications (ECN) system requires all fixed broadband, mobile, home phone and pay TV providers to issue such notifications to existing customers at the end of their term (sent by text, email or letter). The move is designed to encourage switching and helps to keep subscribers informed about the best deals available to them.

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

However, Sky originally disputed this and highlighted section 32 of the 2003 Communications Act, which states: “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 position was thus that they didn’t need to send such notifications because their satellite TV product is merely a “content service“.

On the flip side, Ofcom argued that it is the digital transmission of content that constitutes an ECS and the regulator hasn’t changed their position. In addition, the regulator made it quite plain in their original ECN announcement that the rules also applied to pay TV services.

Ofcom’s Statement

By failing to send end-of-contract notifications to its pay TV customers, Sky has contravened, and continues to contravene, C1.21 to C1.29 of the General Conditions (and their predecessor obligations at C1.10 to C1.15 of the General Conditions) from at least 26 March 2020. Ofcom has therefore issued a Confirmation Decision to Sky under section 96C of the Communications Act 2003.

We have decided that Sky must take all necessary steps to comply with its regulatory obligations to send end-of-contract notifications to customers of its relevant pay TV services, starting no later than nine months from the date of this decision.

In addition, Sky must provide Ofcom with a progress report no later than four months from the date of this decision on the steps that it will take to ensure that the remedy is fully implemented within the nine months given. If Sky brings an appeal against our decision, those directions will be suspended pending the outcome of a first instance decision of the Competition Appeal Tribunal.

The regulator said that Sky has been given two months to decide whether to appeal their decision, and it will be fascinating to see whether the broadcasting giant continues to defend their position. We can understand Sky’s argument on the technical detail, but equally Ofcom makes some valid points and have always clearly stated that ECNs were intended to apply to Pay TV providers too.

Trying to fight Ofcom on this might risk casting Sky in a poor light. We’ve reached out to them for a comment.

UPDATE 12:37pm

We’ve had Sky’s reaction, and they’re sticking to their guns.

A Sky spokesperson said:

“We continue to believe Sky’s Pay TV service is not an electronic communication service under the legal definition in the Communications Act 2003, but we note the outcome of Ofcom’s investigation. We look forward to working with Ofcom to seek a legal review.”