OFCOM and Sky

[Rookie]

Surprised not to see anything on here about the latest OFCOM decision to try and stop all the all powerful Sky.
BBC News - Sky told to cut wholesale prices by regulator Ofcom (other websites also available!)

All seems very strange to me telling a private company that has won sporting contracts and invested a hell of a lot of money in getting the product better how much it can charge for its product. I know they have a monopoly but surely that is only because they have been willing to take the risks that Virgin et al have not with regard to paying for football/rugby what not. (Cue Sky is the devil etc)

 

[captainmorganrum]

Not sure why BT should be allowed to offer Sky Sports 1 & 2 cheaper than Sky either.

Sky have invested billions in the last 30 odd years and Ofcom turns around and says the product they have developed needs to be discounted.
If you built a house and spent twice as much as your neighbour on fixtures and materials etc and the council said you had to sell it for the same price, well we know how you'd feel.

If Virgin or BT etc want the coverage they always have the option of bidding for the broadcasting franchise. Sky have to keep their prices down as far as possible to encourage customers so it's completely unreasonable to offer a discount to competitors.

I'd expect Sky to start showing more 'good' stuff on Sky Sports 3 and 4.

 

[clapham_gull]

In fairness, I think the reason Ofcom are keeping tabs on them is that there are a platform and also make programmes.

Is that's cross domination (in the case of football) that they want shook up a bit.

 

[clippedgull]

I'd expect Sky to start showing more 'good' stuff on Sky Sports 3 and 4.

Seems OFCOM have that covered!

BSkyB’s rivals claim the Rupert Murdoch broadcaster will try and “game” the system by moving some of the most high-profile matches to Sky Sports 3 or 4 so that BT and Virgin subscribers will still miss out on crowd pullers like Manchester United vs Manchester City, for example. Ofcom warned BSkyB that if it attempted to “undermine” the ruling by shifting content on to the other channels it would consider extending the price caps to Sky Sports 3 and 4.

 

[seven stands]

should see the prem rights costing a lot less to buy cue lots of teams in administration just as we begin our climb up the divisions

 

[sten_super]

Not sure why BT should be allowed to offer Sky Sports 1 & 2 cheaper than Sky either.

Sky have invested billions in the last 30 odd years and Ofcom turns around and says the product they have developed needs to be discounted.
If you built a house and spent twice as much as your neighbour on fixtures and materials etc and the council said you had to sell it for the same price, well we know how you'd feel.

If Virgin or BT etc want the coverage they always have the option of bidding for the broadcasting franchise. Sky have to keep their prices down as far as possible to encourage customers so it's completely unreasonable to offer a discount to competitors.

I'd expect Sky to start showing more 'good' stuff on Sky Sports 3 and 4.

The house analogy doesn't really hold here because the point there are only a couple of suppliers of the football at the moment (Sky and Virgin), whereas house prices are a competitive market. Ofcom obviously feel that Sky are charging monopoly prices to consumers and to other distributors.

The argument of the other parties is that due to Sky's domination of the major sports rights, they are not able to build up a sufficient audience to make competing for sports rights worthwhile. They argue that if they started making large-scale sales of Sky Sports, they would have enough viewers to enable them to attempt to buy sports rights without having to take a huge loss on them.

I'm not saying they are right, just what they are saying.

 

[clapham_gull]

The point is that it would be nice to buy Sky products on any platform i.e. Virgin, Freeview whatever at a fair price.

No one is suggesting Sky shouldn't have the rights, only that you shouldn't be forced into buying their equipment to do so.

By lowering the whole sale price of Sky Sports it makes that easier and keeps the market competitive.

The decision has nothing to do who has the rights but everything to do with the manner in which you actually get to watch it.

It's worth pointing out that Sky now have been given the opportunity to offer pay per view services on freeview.

Generally I'm of the opinion that you shouldn't tie channels to particular receiving equipment. It's quite backward thinking and a bit like the old days of the computer industry where software had to be bought from the company that built your PC.

 

[seagullsovergrimsby]

Sky will appeal against the OFCOM decision and take it to the Competition Appeal Tribunal meaning it could take months or a year to reach a ruling. You have to bear in mind that these are wholesale prices , so the other platforms will slap on their profit margin before we find out what they will eventually charge. OFCOM like to interfere and meddle even though they are supposed to operate as a "light-touch" regulator. All in all , this is a bad decision from OFCOM as Sky will spend less on securing TV rights for several sports with the consequence of the monies trickling down to grass roots level becoming even less.

 

[clapham_gull]

Sky will appeal against the OFCOM decision and take it to the Competition Appeal Tribunal meaning it could take months or a year to reach a ruling. You have to bear in mind that these are wholesale prices , so the other platforms will slap on their profit margin before we find out what they will eventually charge. OFCOM like to interfere and meddle even though they are supposed to operate as a "light-touch" regulator. All in all , this is a bad decision from OFCOM as Sky will spend less on securing TV rights for several sports with the consequence of the monies trickling down to grass roots level becoming even less.

Anything that potentially forces football to become less reliant on a single television company is a good thing, not that I think it will.

I personally don't like the idea of being forced to buy a particularly set of equipment to watch a particular channel.

Sky can continue to sell their channel, but make it easier to receive on something other than dish.

I don't see this as Sky bashing at all.