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Canvas will stifle competition, says Sky

Chris Andrews

Sky is stifling competition, say BT and Virgin

It seems that everyone is out to stifle competition these days, starting with the proposed Freeview IPTV platform Project Canvas, according to BSkyB.

Sky is no fan of Canvas. The company has delivered its second response to the BBC Trust, outlining its concerns over the project, which ultimately comes down to Canvas, of course, stifling competition.

In its submission Sky argues that the BBC should not be ‘engaging in platform development and commercialisation’ with its public service remit better fulfilled by distributing content across third party platforms. Sky does acknowledge that the BBC has responsibilities to develop DTT in the UK. However, it said, these responsibilities do not extend to the creation of an IPTV/video-on-demand service. Canvas, it said, would result in “the stifling of investment and innovation in a nascent sector faced with competition from a platform supported by the licence fee, free from the commercial pressures faced by other platforms and retail services.”

So, how much validity is there in this? Is Canvas a BBC platform seeking to dominate the IPTV market? Though not surprising, according to the partners involved in the project the answer is a residing ‘no’. Writing on the BBC Internet Blog on behalf of the BBC, ITV, BT and Five, Canvas’ director Richard Halton responded to Sky’s criticisms.

“Canvas will not be a BBC platform,” he wrote. “It is a proposal for a new joint venture - much like Freeview or Freesat - with commercial partners, and ITV, Five and BT have already committed their support. The BBC's involvement in this venture is subject to BBC Trust approval and we expect their emerging conclusions in the Autumn.”

Halton said that Canvas was not a BBC standard, but would fit in with the standard for connected TVs being developed by the Digital Television Group, and he welcomed support from any ISP, including Sky, who could offer the platform to their subscribers or as a venture partner, “provided their ambitions for a free-to-air platform and open competition match ours”.

Halton also said that subscription-free didn’t mean that all content had to be free, and the platform would support a range of monetisation options including targeted advertising and micropayments and that “Sky could increase the reach of its video-on-demand service Sky Player through the Canvas platform.”

“Canvas is in addition to, not instead of the syndication ambitions of all of the existing partners. Making content widely available is fundamental to the economics of free-to-air content providers and Canvas adds to the range of options available. As a platform, it is intended to reduce the barriers to accessing the television set that some content providers already experience.”

Sky was in the news earlier this month at the other end of the competition stifling stick, reported the Telegraph, as Virgin Media and BT attacked Sky’s pricing mechanism for its premium channels, including sport and films, saying its “near monopoly” of the pay TV market meant increased prices for consumers. They also said that the lack of competition in the market was, that’s right, “stifling growth and innovation”.

This was in a joint submission to Ofcom from the two companies, as well as Top-Up TV, which offers Freeview access and DVR. Ofcom has launched proposals to control the wholesale pay-TV market saying that regulated prices would mean greater choice, and Sky has rejected the idea as being an attack on a functioning market already delivering for consumers. Ofcom is now consulting on the proposals.

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