VirginMedia vs BSkyB continued (or Thanks Mum)

On Wednesday night, at midnight, the BSkyB channels were taken off VirginMedia. Virgin’s offer of independent arbitration was rejected by Sky and no last minute agreement was made.

When you select the Sky One channel, you get a constant promotion for the Virgin Central channel and the following message “Thanks to Sky, the Sky One channel is no longer available. They’ve picked up their ball and gone home. Foul play? We think so. To have your say visit Press i to find out more. Stay tuned to Virgin Central and you can still watch your favourite shows. Press (red button) sit back and enjoy”

We had a look at what is on offer on the Virgin Central on demand channel and there are only 7 different shows at the moment. That said Series 4 of Alias is there and we missed several episodes of this when we saw it last, so we will be able to catch up on them. They need to get a lot more selection available to make it worthwhile.

On Monday, the government asked the media regulator, Ofcom, to investigate BSkyB’s controversial purchase of a 17.9% stake in ITV. This purchase was made on 17th November, shortly after NTL (now VirginMedia) had announced it was interested in merging with ITV on 9th November. This move was seen as a move to block a bid for the firm from its rival NTL. This purchase was referred to the
Office of Fair Trading, who released a statement on 12th January, which states that they believe ‘ a relevant merger situation has been created since Sky and ITV may have come under common control for the purposes of the Enterprise Act 2002 (the Act) as a result of Sky acquiring material influence over ITV’
. They issued a formal invitation for comments.

Yesterday, the National Consumer Council were considering making an official complaint.
Philip Cullem, deputy chief executive of the consumer council, accused both broadcasters of “behaving like children”. “At the end of the month we’ll make a decision about putting in the super-complaint that that will help to knock heads together,” he told BBC Radio Five Live.

Whatever the outcome, it is the consumer who ends up worse off. If an agreement is reached to carry the channels again it will probably be more than VirginMedia want to pay and less than BSkyB want, so both will probably put their prices up. If VirginMedia don’t carry the channels, Sky are estimating a reduction in operating profits of up to £20m ($39.3m), so this will have to be made up from somewhere. I expect in a couple of months time, when the majority of VirginMedia customers who are going to switch to Sky have done so, and are tied into a 12 month contract, the prices will go up.

Anyway, to the ‘Thanks Mum’ from the title. Mum has Sky not VirginMedia and so still has access to Sky One and is going to record Stargate SG1, Atlantis, Battlestar Galactica and the Dresden Files for us. So, at least in the short term, the loss isn’t going to have a major impact. Who knows, maybe VirginMedia can negotiate with the US companies and provide the shows themselves without having to rely on Sky at all.

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