ONdigital and Sky threaten digital cable

BSkyB and ONdigital are attempting to strangle digital cable’s launch at birth by lobbying a joint Independent Television Commission (ITC)/Oftel investigation to prohibit the cable industry’s low priced TV and phone packages.

This is despite last month’s moves by BSkyB and ONdigital to give away free their set-top boxes previously priced at £199, and to offer 40 per cent dsicounts on standard BT phone bills to new subscribers.

Sky and ONdigital are simultaneously offering low priced TV and phone services, while arguing behind closed doors that these packages be banned, or scaled back.

One source in the cable industry says: “These two are going along with a sales tactic over the short term, which they will break.”

In papers submitted earlier this month to the ITC/Oftel investigation into whether TV and phone packages are anti-competitive, Sky argues that the watchdogs should “prohibit pure bundling of TV and telephony services by cable operators”. ONdigital argues similarly.

But both Sky and ONdigital refer to their offers as “discounts” rather than as bundled packages.

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