Sky cleared of anti-competitive movie dominance

BSkyB does “not adversely affect competition” in the pay-TV movies market, the Competition Commission (CC) has found after a lengthy inquiry.

Sky Movies

The CC concluded today (2 August) in its final report that Sky Movies, which is first to offer pay movies from all the big Hollywood studios, is not a sufficient driver of subscribers’ choice of pay-TV provider to give Sky an undue advantage over its pay-TV movie rivals.

It said that the launch of new services from Netflix and Lovefilm have increased competition and consumer choice, reflecting the consumer trend towards watching audio visual content via the internet.

The CC added that Sky’s launch of Now TV also does not harm competition because it gives consumers a new way to subscribe to Sky Movies separately from their other pay-TV subscriptions.

It also reflected that consumers attach more importance to other pay-TV service attributes such as price and having a broad range of content, rather than just seeing movies as their main driver to sign up.

This marks a change from the CC’s provisional findings in August last year, when it said Sky did restrict competition. At the time it proposed restricting the number of major movie studios from which Sky could exclusively license movies from, amongst other remedies.

Laura Carstensen, who led the inquiry, says: “We have seen significant change in pay-TV movie services in the course of our inquiry and have considered the implications of these developments carefully in reaching our final views. It is clear that consumers now have a much greater choice than they had a couple of years ago when our investigation began.”

The CC will not propose any remedies in light of this conclusion.

BSkyB says in a statement: “Sky considers there to be overwhelming evidence that UK consumers are well served by strong competition between a growing number of TV providers, including those offering movies.”

Rival Virgin Media, however, says it “strongly disagrees” with the CC’s findings and in May said that the launch of Netflix and LoveFilm have not changed Sky’s dominant position.

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