Sky slams ITV for lack of clarity on retransmission

Graham McWilliam

BSkyB has slammed UK commercial broadcaster ITV for allegedly failing to provide “concrete details” about how its demand for retransmission feeds from the pay TV operator would work in practice.

In a blog posting published ahead of ITV’s quarterly results announcement this week Sky’s group director of corporate affairs, Graham McWilliam, said ITV had “gone silent” on the issue since its call in August for the implementation of US-style retransmission fees, which would see ITV and other free-to-air broadcasters paid for making their channels available over Sky’s network rather than paying Sky for them to be broadcast.

McWilliam demanded that ITV make it clear whether it, like Channel 4, “is in favour of additional regulation” in the form of a fee set by Ofcom and noted that ITV had not publicly welcomed the UK government’s review of whether it would be possible to reduce the regulations governing relations between platform operators and broadcasters. Such deregulation, he said, could see a removal of the rules on the position of the UK’s leading channels on the Sky EPG.

In September, culture secretary Sajid Javid said his department would review both whether payments between broadcasters and platform operators should be subject to regulation and whether positions on EPGs should be regulated.

“Genuine deregulation would mean removing specific obligations on both [public service broadcasters] and platforms so that an unfettered commercial negotiation can take place,” said McWilliam. “For example, this would include removing the rules requiring Sky to carry PSB channels on its platform and to provide them with the top slots on our EPG. At present, we receive nothing in return for giving up these commercially valuable slots, which deliver audiences and advertising revenue to ITV.”

McWilliam said that the UK public service broadcast system was based on “expectations of universal availability”, unlike the US system, and argued that US-style transmission blackouts could have a major impact on ITV’s advertising revenue.

McWilliam also questioned whether ITV would invest therevenue from retransmission fees in new original programming, pointing to stock market expectations of a profits windfall if retransmission fees are made obligatory.

In September, ITV CEO Adam Crozier announced that ITV and other broadcasters would push for retransmission fees from Sky and Virgin Media, whose owner, Liberty Global, is a minority shareholder in the broadcaster.

Analysts at Credit Suisse said at the time that the imposition of retransmission fees could add up to ￡1.5 billion (€1.9 billion) to the value of ITV.