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Virgin Media UK Lodges Project Canvas Competition Complaint with Ofcom

Posted: 03rd Aug, 2010 By: MarkJ
virgin media ukCable giant Virgin Media has carried out its earlier threats by lodging an official competition complaint against Project Canvas in the UK. Canvas claims to be an open standard for delivering subscription-free broadband internet TV services directly into homes via your ISP and special £100-£200 set-top-boxes (mix of freeview/freesat and other tech).

The complaint is 85 pages long and claims that the Joint Venture (JV) partners, which include the BBC , ITV , BT , TalkTalk , Channel 4 and Arqiva, have failed to uphold Canvas's original "open standards" principals. VM alleges that Canvas is now anti-competitive, a proprietary closed platform, and will limit consumer choice instead of expanding upon it.

Virgin Media's CEO, Neil Berkett, said in June (here):

"The Canvas consortium has rejected the opportunity to incorporate Canvas into the Virgin Media customer experience, insisting that if we want to use their standards we must also accept that the entire Virgin Media entertainment service be accessed by our subscribers via a Canvas-imposed interface, including the Canvas channel listing and search facility.

This "shop window" to services would be entirely controlled by the joint venture partners and would allow the Canvas partners to give preference and prominence to their own channel content above that of any other content provider."

A Virgin Media Spokesperson added today:

[The] Canvas partners have significantly exceeded their original claims to be creating a common set of open standards which could have been improved upon by others and are now intent on controlling every aspect of how people watch TV.

The BBC Trust has already acknowledged, but then completely ignored, the impact that Canvas will have on so many different organisations; from consumer electronics firms to software developers and enterprising new technology manufacturers to independent programme makers. We strongly urge Ofcom, supported by the OFT, to thoroughly examine Project Canvas and its clear anti-competitive behaviour."

uk project canvas exampleRegular readers will recall that the Office of Fair Trading (OFT) had to throw out its own investigation of Canvas in May 2010 because it did not have jurisdiction to review it under the merger provisions of the Enterprise Act 2002 (original news).

Canvas approached the OFT on its own merit, with the aim of seeking a formal clarification. However the OFT's decision did not preclude the application of other Competition law provisions and relevant legislation, only that they did not have the right powers to investigate.

The BBC Trust ultimately approved Project Canvas for launch at the end of June 2010 (here), albeit alongside some fairly minor conditions. Canvas had been due to complete by early next year, with TalkTalk already planning its own related TV service for launch sometime in 2011 (here), although Virgin's latest move is likely to delay such efforts.

Ofcom had previously warned the BBC Trust that Canvas needed to go further if it wanted to avoid being seen as a service that could discriminate against any non-Joint Venture partners. One suggestion was that it should be made available to services other than just Freeview and Freesat (e.g. Virgin Media's platform). Failure to do this properly could have a very negative impact.
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