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LONDON (Alliance News) - UK telecoms regulator Ofcom Monday launched a supplementary consultation over whether Sky PLC's insistence that rivals supply key sports content in order to get access to its own sports content "would prejudice fair and effective competition."
Ofcom is undertaking a review into the wholesale must-offer obligation it imposed on Sky that requires it to offer wholesale access to its Sky Sports 1 and 2 channels to competitors.
As a result of responses it received in its consultation on the matter, it has identified a specific issue that it will consult on further with stakeholders - Sky's insistence on reciprocal supply of key sports content.
Sky and rival BT Group PLC entered talks for the wholesale supply of Sky's sport channels to BT's Youview platform after the 2012 Premier League auction, and BT has said that in those talks Sky made the supply of these channels conditional on BT wholesale its BT Sport channels to Sky.
Sky has indicated that "its concern about reciprocity of supply is not a recent development and is not linked to BT?s emergence as a significant competitor to Sky in the past few years," Ofcom said. This leads Ofcom to believe it is therefore likely Sky would include similar terms with anyone that has acquired, or may acquire, key content rights.
The rivalry between BT and Sky has heated up over the past two years following the launch of BT's new BT Sport channels, challenging Sky in its dominant area of paid sports television. The competition between the two led to a significant jump in the costs at the most recent auction for the broadcasting rights to the English Premier League. The rights were sold for a total of GBP5.13 billion, jumping from GBP3 billion at the previous auction.
Shares in Sky were up 0.2% at 1,133.00 pence Monday morning, whilst BT was up 1.2% at 468.00 pence.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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