BT may join rivals in Sky blockbuster fight

| August 5, 2012 | 0 Comments

By
Tom Mcghie

16:11 EST, 4 August 2012

|

16:11 EST, 4 August 2012

BT is considering teaming up with its rivals to launch a legal challenge to the Competition Commission’s decision to let BSkyB be the first company to broadcast Hollywood blockbusters on TV in Britain.

A bitterly disappointed Gavin Patterson, head of BT Retail, which also runs BTVision, the group’s fast-growing TV business, said the decision left BSkyB in a ‘dominant monopoly position’ and gave it a ‘stranglehold’ over British TV broadcasting of Hollywood movies.

His comments come after the commission ruled that it would not intervene to overrule BSkyB’s deals with six major film studios, giving it first TV broadcast rights in the UK.

Blockbusters: Sky can show some of the latest movies, such as The Dark Knight Rises, under the deal

Blockbusters: Sky can show some of the latest movies, such as The Dark Knight Rises, under the deal

Patterson said BT itself had once
been a monopoly but had been required to loosen its grip on telecoms,
and that the same should apply to BSkyB.

‘We know all about monopoly
positions,’ he said. ‘BT was itself in this position 25 years ago. Now
if you want to buy a subscription for the newest Hollywood movies, you
can only buy it through one company and that is BSkyB.’

BT was struggling to understand the
logic of the commission decision, he added.
But according to the commission BSkyB’s strong position in the pay-TV
movie market ‘does not adversely affect competition’. It said that the
arrival of new services such as Netflix and LoveFilm had increased
consumer choice.

Laura Carstensen, who led the
commission’s inquiry, said: ‘It is clear that consumers now have a much
greater choice than they had a couple of years ago when our
investigation began.’

But Patterson insisted that the
commission’s decision harmed BT’s commercial interest because thousands
of people made their choice of TV subscription services on whether they
could see the latest movies, such as The Dark Knight Rises, the Batman
film with Christian Bale, which was released last month.

He said that BT executives would now
sit down and go through the commission judgment and then consult with
other companies about what action to take. He said: ‘There are avenues open to us.’

BT is battling hard to boost its TV
subscriber base. BTVision has more than 700,000 subscribers, but Sky has
more than ten million.
The big lure for viewers is live football and films. In June BT bought
the rights to show 38 big games for three years from 2013 for
£738million.

But Sky paid £2.3 billion to screen
116 live games.
Many analysts believe BT overpaid for the football rights and this
explains the pressure it faces trying to add to its subscriber base and
hence the importance of having the ability to screen big movies.

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