The Competition Commission has blocked the proposed video on demand (VOD) venture Project Kangaroo.
The joint venture between the BBC through BBC Worldwide, ITV and Channel Four has been blocked as the Commission concluded none of the remedies proposed could remove the threat to competition in the VOD market.
In its final report, the Competition Commission confirmed its provisional finding the joint venture is likely to result in a substantial lessening of competition in the supply of UK TV VOD content at the wholesale and retail levels.
Peter Freeman, Competition Commission chairman and chairman of the inquiry group said, “After detailed and careful consideration, we have decided that this joint venture would be too much of a threat to competition in this developing market and has to be stopped.”
“Without this venture, BBC Worldwide, ITV and Channel 4 would be close competitors of each other. We thought that viewers would benefit from better VOD services if the parties, possibly in conjunction with other new and/or already established providers of VOD, competed with each other,” said Freeman.
Michael Grade, chairman and chief executive of ITV said, “We are surprised by this decision because we believed that the Kangaroo joint venture, competing in a crowded online world against dominant global brands, was an attractive UK consumer proposition, free at the point of use.
“However, in the two years since the idea for Kangaroo was born, the success of ITV.com has proved that our UK content is attractive enough to stand on its own and we remain focussed on our online growth.”
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