Virgin goes to court in Sky disputeBSkyB says legal action is 'without foundation'

13 April 2007

 

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Virgin Media has launched High Court proceedings against arch rival BSkyB in an attempt to resolve its dispute over carrying basic Sky channels.

The group, rebranded from NTL earlier this year, accused BSkyB of 'using its dominance' in the industry to stifle competition after the broadcasting giant refused to settle the spat over Sky channel charges through arbitration by an independent expert.

BSkyB withdrew its basic channels from Virgin Media in March, leaving thousands of viewers without channels including Sky One and Sky News, with many fans of hit shows such as 24 and Lost cut off mid-series.

Virgin Media claims that BSkyB attempted to double the price for its basic channels. It said it was also taking BSkyB to court over the rates Sky pays to air Virgin channels, such as Living and Bravo, for which it claims it was forced to accept a reduction.

'Market dominance'

Virgin Media said it was exercising its powers under the 1998 UK Competition Act and EC Treaty prohibiting a company from abusing its dominant position.

The group is hoping the court action will enable the two broadcasters to renegotiate the price of the basic package on 'reasonable commercial rates', alongside achieving 'fair payment' for its channels.

Virgin Media will seek damages if an agreement cannot be reached to compensate for loss of customers it claims have left as a result of the dispute. A Virgin Media spokesman remained tight-lipped on how many customers it had lost since the Sky channels stopped, but added 'it has clearly been a very unsettling time'.

Virgin Media Chief Executive Steve Burch said: 'This dispute is one very specific example of how UK consumers are being denied the benefits of a diverse, dynamic and competitive pay TV market. Litigation is obviously a serious step and a last resort but we are determined to have these issues resolved as quickly and fairly as possible.'

Sky channels

BSkyB said in a statement that the legal action was 'without foundation and is an obstacle to bringing back Sky's basic channels for Virgin Media customers'.

The broadcaster is claiming it has invited Virgin Media back to the negotiating table with an offer of 3p per customer per day for the basic channels and that Virgin Media's attempts to renegotiate payment for Virgin channels on Sky 'had absolutely no relevance for cable viewers'.

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