Digital TV News

Virgin Media files legal proceedings against Sky

14 April, 2007

editorial@consumerchoices.co.uk

Virgin Media has started legal proceedings against BSkyB, in a move predicted by DigitalChoices.co.uk earlier this week (visit www.virginmedia.com / www.sky.com).

The proceedings were filed in the High Court on April 12th, and aim to resolve the dispute around Sky withdrawing its basic channel package from the Virgin Media digital TV platform.

Virgin is also challenging Sky to increase the rates it pays for the carriage of Virgin Media channels (including Living, Bravo and Trouble) on the Sky TV service, which Sky allegedly reduced by 85% in January.

Virgin also continues to claim that Sky attempted to double the fees that Virgin should pay for the basic Sky channel package, despite a decrease in their popularity.

Virgin’s legal documents refer to Section 18 of the UK Competition Act 1998 and Article 82 of the EC Treaty, which both prohibit companies from abusing their dominant position.

Almost 70% of the UK’s pay TV subscribers have Sky TV, which makes Sky the dominant provider. Virgin claims that Sky has “engaged in a strategy to stifle competition by using its dominance against Virgin Media”, and uses Sky’s recent marketing campaign as an example. As soon as the channels were removed from the Virgin Media network, Sky promoted their withdrawal as a reason to switch to Sky.

Virgin Media’s CEO, Steve Burch, said: "This dispute is one very specific example of how UK consumers are being denied the benefits of a diverse, dynamic and competitive pay TV market."

Chris Eagle, commercial manager at DigitalChoices.co.uk, comments: “It’s great that Virgin Media has followed up on its promise to take this seriously. DigitalChoices.co.uk and consumers throughout the UK will be awaiting the outcome with baited breath.”

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