Sky Movies is cleared in probe thanks to Lovefilm and Netflix
SATELLITE broadcaster BSkyB no longer dominates the pay-TV movie market following the arrival of new entrants Lovefilm and Netflix, the competition watchdog said yesterday in a reversal of its initial findings.
But the decision drew angry responses from Sky’s main rivals BT and Virgin, who said its Sky Movies channel reduces competition.
Laura Carstensen, chairman of the Competition Commission investigation, said: “Lovefilm and Netflix offer services which are attractive to many consumers and they appear sufficiently well resourced to be in a position to improve the range and quality of their content further.”
Given the findings, the regulator said it would now not propose any remedial action. It will review responses to its revised finding before reaching its final verdict.
The provisional finding was a reprieve for BSkyB which has clashed repeatedly with regulators in recent years over its dominance of pay-TV, putting at risk its ability to lure customers with the offer of exclusive movie and sports content.
The Competition Commission had previously found that Sky’s subscriber base of more than 10m homes gave it an advantage over rivals who struggled to bid for the rights to first-run Hollywood movies.
While the commission noted yesterday that BSkyB still held the rights to the movies of all six major Hollywood studios for the first subscription pay-TV window, it said Netflix and the Amazon-owned Lovefilm had already acquired rights to several other studios.
Virgin Media said it “strongly disagrees” with the commission and that Sky’s dominance had led to “higher prices” and “less innovation.
A BT spokesman said: “We cannot see how this is in the best interests of consumers.