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Tiscali, BT Fire Competition Warnings Over Project Kangaroo

Posted: 16th Sep, 2008 By: MarkJ
Project Kangaroo (SeeSaw), a joint broadband Internet TV (IPTV) service venture between the BBC, ITV and Channel 4, received more flak today after both BT and Tiscali warned of the damage it could do to the fledgling pay-TV market, reports C21Media.

The warnings came as part of an official response by both ISPs to a Competition Commission (CC) investigation, which was kicked off by complaints from rivals Sky and Virgin Media over fears of the project having an unfair advantage due to the broadcasters public service positions.

Tiscali said: "There will be less need for consumers to use other TV platforms such as Tiscali, BT Vision, Sky and Virgin Media. The public service broadcasters will take advantage of their brand power (and public funding, in the case of the BBC) to challenge the future of the UK pay-TV market.

With fewer subscribers and difficulty in securing valuable content, pay-TV platforms may not be able to continue to carry channels such as Discovery, National Geographic or Living and the business model for much of the UK’s present pay-TV and platform markets may begin to fall apart.
"

It's worth pointing out that the pay-TV market is already dominated by BSKyB and Virgin Media in the UK, although broadband Internet TV (IPTV) services are harder to gauge. Naturally BT, which has its own BT Vision IPTV services like Tiscali, chose to adopt a similar stance:

BT said: "The Kangaroo parties together own or control a vast library of very valuable VoD content. In particular, together they control the great majority of all UK-produced TV content.

There is a very real likelihood that, by providing this vast library of content on the Kangaroo service, the parties will be able very materially to reduce competition for the supply of UK VoD content.
"

Typically Tiscali's own TV service (formerly HomeChoice) appears to have been shrinking, while uptake of BT Vision should have done better than the 280,000 customers it already has. It's easy to see where the concern comes from. It's now hard to perceive Project Kangaroo going forward without some sort of restriction.
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