Ofcom has opened a consultation on whether requiring Sky to offer its Sky Sports 1 and 2 channels to other pay TV providers remains an appropriate way to ensure competition.
The broadcaster has been forced to wholesale its two biggest sports channels to rivals since 2010 despite a legal challenge brought by Sky which insists it’s willing to supply the channels on mutually agreed commercial terms without outside regulation.
In April Ofcom said it would review its original decision in light of changes in the pay-TV market, including the arrival of BT Sport which competes with Sky for major sports rights, and the launch of new products such as Sky’s NOW TV streaming service.
From next season BT will have exclusive rights to the Champions League and it and Sky are expected to fiercely contest the next Premier League rights auction.
Ofcom says it believes these sports “are key content likely to be capable of influencing consumers’ choice of pay TV retailer.”
In a statement, the regulator said: “Sky currently holds over 75% of live rights to Premier League football and has more than 80% of market revenues from the supply of key sports channels.
“The content Sky has is likely to influence the purchasing decisions of a sizeable proportion of high-value customers. Retailers that do not have access to this content would find it more difficult to compete for these customers.
“Given Sky’s continued strong market position, Ofcom is seeking views on its assessment that if there was limited distribution by Sky of its key sports content, competition between pay TV retailers may be harmed. Ofcom is also seeking views on whether, given its market position, Sky may have incentives to limit distribution of its key sports content.”
Although Ofcom says BT may also have incentives to limit distribution of its key sports content, it says the smaller amount of content it offers makes it “less clear that limiting distribution of its sports channels would harm competition.”
However it’s invited views on this assessment.
The consultation can be accessed on the Ofcom website and further details about the review will be announced in 2015.
