- Mar 21, 2004
- 29,387
- 34,059
not sure exactly what this means, what it is trying to achieve or who will benefit
from BBC
http://www.bbc.co.uk/news/business-29426570
and this is what sent out by Virgin Media internally
from BBC
http://www.bbc.co.uk/news/business-29426570
and this is what sent out by Virgin Media internally
You may have seen media reports this morning that Virgin Media has asked Ofcom to open an investigation into the way that the Premier League sells live television rights in the UK.
This is the right action to take, for our customers and for our business. There is a strong base of evidence to support the case we are making.
Broadcasters secure the rights to broadcast Premier League football live on TV through an auction managed by the Premier League. The Premier League sells the rights on behalf of all of the individual clubs.
The total cost of live rights increased by 70% to £3.02bn at the last auction; these costs are being passed on to consumers, and so this ever increasing inflation in cost means consumers must pay more.
Under the current structure, there is widespread speculation that there will be another significant increase in the cost of live television rights when the next auction process starts – probably later this year. For Pay TV customers, this inevitably means even higher prices. That is why we felt it important to take this action.
The Premier League’s selling arrangements were accepted by the European Commission in 2006, although they raised competition law concerns. As part of this, the Premier League agreed to a number of time-limited ‘Commitments’ such as ensuring that no single bidder could acquire every package of rights and the release of more games. These commitments, which have now expired, were intended to promote competition.
We have asked Ofcom to review these commitments and the auction mechanism as we believe they have failed. The price of watching all Premier League games on TV is, on average, three times higher than for other top European Leagues. Also, Premier League viewers also get less for their money as only 40% of its matches are available for broadcast - compared to the other major European leagues where 100% are available.
We are asking Ofcom to make targeted changes to the mechanism by which live rights are sold, while preserving the benefits of joint selling of those rights. There is a window of opportunity now, before the next auction process begins, for Ofcom to review the effect of rising prices on viewers and football fans.
This is clearly now a matter for Ofcom. I will keep you updated on our progress.