Name and title under which you would like this response to appear: Anonymous 201 Representing: Self What do you want Ofcom to keep confidential?: None If you want part of your response kept confidential, which parts?: Not applicable Ofcom may publish a response summary: Yes I confirm that I have read the declaration: Yes Ofcom should only publish this response after the consultation has ended: You may publish my response upon on receipt Question 1:To what extent do you consider that DTT, DSat, cable and IPTV are in competition with one another for subscribers of pay TV services ? either at present or in the future?: Given the space limitations of DTT, irrespective of whoever operates the pay element, DTT is only ever likely to be a limited competitor. The provision of a full range of additional services and the real competition to attract viewers to turn them into subscribers is likely to be between DSat (Sky), cable (Virgin Media) and IPTV (British Telecom and Virgin Media). This is likely to remain so for the foreseeable future because the digital switchover process will not deliver greatly expanded broadcast space to DTT. Question 2:To what extent do you consider the Proposal is likely to deliver benefits to the consumer?: Ofcom’s duty is to promote competition, to protect the viewer and promote choice and variety at a reasonable cost to the viewer. This proposal would deliver no long term benefits whatsoever to the consumer for either free-to-air or pay television. In terms of the Freeview element of DTT, the loss of the Sky channels to a DTT pay system would be a significant and unacceptable loss of choice and variety. Sky News would be lost leaving only BBC News 24 as the sole dedicated Freeview news channel. The loss of Sky Sports News would mean the loss of the only free-to-air sports channel on Freeview. This channel shows a mixture of sports news and some live action and it would be a profound loss. One the surface, the Sky 3 entertainment channel would seem a lesser loss but it makes a unique contribution because it shows series like Nip/Tuck, Bones, etc. that only Sky has access to and it shows a range of documentary, arts and motoring programmes that are not available anywhere else on Freeview. Sky would also be able to buy any new channel leases that come up for sale and Sky could apply pressure to the existing channel holders to encourage them to join their new pay TV system, e.g. the UKTV Group's channels. This would start to significantly damage the attractiveness of Freeview and so threaten the digital switchover process. There will be little incentive to go digital if Freeview becomes a skeleton service sharing space with an overlarge Sky pay TV element. For these reasons this proposal should not be allowed. The proposal would also be detrimental to the consumers of pay television. This proposal, if granted, would make Sky even more powerful and it would control the access to pay services, the gatekeeper functions, on two digital media platforms namely DTT and DSat. This would increase Sky's power significantly and that would be reflected in Sky having greater capability to acquire sole rights to programmes and series, to acquire the rights to premium sports events and films and to set the access rights conditions to the digital platforms under its control. This would be profoundly anticompetitive and would hinder the growth of major competitors like Virgin Media, British Telecom and Setanta and their capabilities to get attractive programming to compete with Sky. This consultation should also be seen against the wider media background of the Competition Commission's investigation into Sky's ITV stake (see Appendix 1) and the joint submission on the pay television market to Ofcom by Virgin Media, British Telecom and others (see Appendix 2). It is quite clear that even without these proposals, Sky is in an overstrong position and it is acting against the public interest by virtue of its existing operations and its recent 17.9% stake in ITV and that is according to the Competition Commission. To allow these proposals would only compound this problem. Similarly, the submission by Virgin Media, British Telecom and others shows, amongst other things, the poor behaviour by Sky in respect of supplying channels to Virgin Media, the provision of a high definition channel to Setanta and the acquisition of a large stake in ITV to block Virgin Media's tentative plans. To allow these proposals would only make the situations highlighted in the submission much worse. Question 3:To what extent do you consider that there is scope for sustainable competition in pay TV on the DTT platform and, more broadly, across all pay TV platforms?: There is no chance whatsoever of any sustainable competition in pay TV on DTT. Sky is several orders of magnitude larger than the existing pay television provider, Top Up TV and it would be a thoroughly unequal competition. The Top Up TV Anytime service and the Setanta 1 sports channel would not stand any chance against Sky's well funded marketing campaign. The only outcome would be a Sky victory leaving it in control of the pay systems on two digital media platforms and this is simply unacceptable. Furthermore, DTT is so limited in space that there is barely enough room for one pay TV provider let alone two fighting it out for dominance. Even after digital switchover, there will be precious little extra space and even that should be reserved for a free-to-air basic high definition service. The existing pay system operated by Top Up TV should be left alone to succeed or fail as market forces dictate. Pay television on DTT has a history of failure as the collapse of ITV Digital and the failure of the initial channel share offering of Top Up TV show. In the event of the failure of Top Up TV, Ofcom could allow another operator to start up using the existing conditional access boxes but that operator should not be either Sky, Virgin Media or British Telecom and that would promote competition. These three particular companies should not be allowed more than a 10% stake in any future DTT pay television provider so as to promote competition. The general prospects for pay television are better and the different platforms all have one different pay television provider - Sky on satellite, Virgin Media on cable, British Telecom on IPTV and Top Up TV on DTT. Ofcom should be looking at the wider picture and it should seek to promote competition for viewers between these different platforms and it should seek to remove any legislative, regulatory or physical barriers to competition between the different platforms and companies rather than promote unsustainable and pointless micro- competition within any one platform. For instance, British Telecom's Vision service depends on a Freeview core which is only available to 75% or so of the British population so Ofcom should, with DigitalUK and others, facilitate the wider coverage of Freeview so that 98% of the population can access Freeview and so get the full BT Vision service thereby promoting competition. Similarly, Virgin Media can only reach about 55% of the population by cable but its own plans for an IPTV service should be facilitated, e.g. by ensuring fair and reasonable access to British Telecom facilities with Ofcom acting as the impartial adjudicator in any disputes. Ofcom should set itself targets so that, for example, by 2012 75% of the population should have easy access to any two of the three major pay television systems (Sky, Virgin Media, British Telecom) rising to 95% by 2017. Similarly, by 2012, 65% of the UK population should have easy access to all three major pay systems rising to 85% by 2017. That really would promote competition and viewer choice and provide strong competition for Sky. Question 4:What are likely to be the key aspects of competition between providers of retail pay TV services on the DTT platform? E.g. what is the role of premium sports and movies content?: As stated above in Question 3, it is a complete myth that there will be any meaningful competiton bteween providers of retail pay TV services on DTT. If this proposal is allowed then all that will happen is that Sky's commercial power will just ensure that Sky replaces the existing Top Up TV/Setanta alliance within a couple of months. Irrespective of whoever runs the pay element on DTT, the space on DTT is so limited that it will never be able to provide a full and comprehensive pay television premium sports, films and high definition service. If people want some extra films and a few premium sports then the existing Picture Box service from Top Up TV can provide that while Setanta supplies a few additional sports events. If a customer wanted a wide range of additional sports channels, modern box office films and high definition channels then they would have to migrate to one of the other platforms anyway. Furthermore, allowing Sky to run the DTT pay service has film and sports rights and pricing implications as mentioned elsewhere. This proposal would concentrate Sky's power and would squeeze out the ability of competitors to obtain additional rights as this proposal would make Sky even more powerful and monopolistic. Question 5:Do you consider that if Sky were to become the only provider of pay TV on the DTT platform it would be likely to have a significant detrimental effect on competition in the long term? How might this affect the development of other platforms for the delivery of pay TV services?: Yes, there would be a significant and adverse effect on pay television competition.