Former state-owned telecoms giant BT has formally whinged to Ofcom that archrival Sky should be subject to regulatory intervention over its dominance in the paid-TV market.
BT has asked Ofcom to change the scope of its review into digital communications, citing "high prices and poor outcomes for consumers arising from a lack of competition in pay TV".
The retaliatory blow follows Sky’s call to Ofcom last month to break-up BT Openreach.
John Petter, chief exec of BT’s Consumer Division, described Sky's break-up calls as a “smokescreen” designed to obscure the real market failings in pay TV, where Sky is the dominant player.
"Whereas in the energy market regulators have criticised the Big Six operators, in pay TV Sky has a 64 per cent share, so there is really only the Big One," he said.
He told delegates in a speech at the Broadcasting Press Guild that the broadband market has four major players but none with over 32 per cent market share. In contrast the pay TV market has one dominant player with a 64 per cent share, he said.
BT is eager to boost its BT Consumer division, which includes TV and BT Sport. According to its last quarter results this was the only division to grow, with sales up 3 per cent to £1.1bn.
Paolo Pescatore, director at analyst firm CCS Insight, said the timing of the spat is significant as Ofcom's Digital Communications Review later this year will be the first major review of the market in a decade.
"BT makes a strong case, but the market has lacked a strong rival to Sky. Now with BT’s entry into sports, the competitive landscape is changing," he said.
A Sky spokesman told the Reg:
“It is strange to hear BT talk about high prices when they are about to increase the price of BT Sport for Sky TV customers by 48 per cent.This looks like an attempt to deflect attention from the real problems that exist in broadband, where consumers are suffering because of BT’s under-investment and there is concern about competition in the future.” ®