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Sky runs rings around policy makers

Another day, another appeal lodged. Serial litigant Sky is, like one of those ambulance chasing law firms, spending rather a lot of time in the courts. Last month, Sky finally sold its stake in ITV. This 17.5% stake, bought in November 2006 clearly with the purpose of thwarting ITV management, was finally sold in February 2010 for a £350m loss. For three and a half years, Sky appealed against rulings that it should dispose of the stake.

Everyone, literally everyone, knew what Sky was up to and frankly the fact that ITV was such a basket case did nothing to help its cause either. This month, Sky – it is ruled by Ofcom – must cut the wholesale price of its sports channels. This dispute, too, has been going on so long that one of the companies behind the action is no more.

Sky's tactic here has successfully seen out Setanta. It will, of course, appeal to the Competition Appeal Tribunal. So we’ll pick this up in about three years, then.

This is broadcasting policy by default or regulation by competition law and it is unsatisfactory at best. It’s impossible to have a coherence of position through appeal tribunals. They take three years to get to the point where they can even make a decision for a start. There's no point railing against Sky. While their behaviour might mimic that of a non-compliant toddler, they’re not doing anything wrong. What else should they do but protect their shareholders interests for as long as legally possible?

Take a look at the competition appeal tribunal's website (www.catribunal.org.uk) and run through the nine pages of cases looked at since its inception in 2003. The vast majority are communications. Cable and Wireless, BT, Sky, Virgin, Telefonica, T-Mobile must be stuck in the revolving doors.

It's not Ofcom's fault, easy though it is to look at the regulator and raise an eyebrow. This is a failure of policy. The DCMS must take the blame for failing to properly engage with the complex sprawl that are our communications companies.

If one entity is effectively controlling the markets in terrestrial broadcasting, digital broadcasting, sports rights, movie rights and pay per view content then this needs to be looked at in the round. It’s just a waste of everyone’s time and money to be still fighting appeals on acts of corporate sabotage performed three years ago.

Janine Gibson is editor of guardian.co.uk

Posted 19 April 2010 by Janine Gibson
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