Media Forum: Is YouView anti-competitive?

Are the concerns voiced about the service justified, Alasdair Reid asks.

Richard Halton, the chief executive of YouView, the proposed internet protocol television platform formerly known as Project Canvas, isn't often taken by surprise. After all, he used to be a gimlet-eyed management consultant - and until recently, he was one of the BBC's brightest young things when it came to putting a digital hat on and gazing into the corporation's crystal ball.

And yet, last week, his new ball seemed to fail. Or at least that was the impression he was trying to create, acting all shaken and upset at the news that BSkyB, supposedly at the 11th hour, had told both Ofcom and the Office of Fair Trading that it would like the regulators to run their rule over YouView.

Sky joined at least 11 other parties in submitting concerns to Ofcom, but the regulator this week gave the green light to YouView, arguing that it will "bring benefits to viewers and consumers". While it has not ruled out a future investigation should evidence "emerge that YouView causes harm to the interests of viewers and consumers" for the time being, at least Halton can crack on with the task of developing and launching YouView.

Halton and Kip Meek, YouView's non-executive chairman who was previously employed by Ofcom, will know that Sky is not alone in expressing concerns about their venture. Virgin Media, for instance, lodged an official complaint back in August. And parts of the advertising industry have been disappointed, to say the least, that so little care has been taken to canvas (no pun intended) their views. After all, this is clearly a project with advertising at its core.

So they may have noticed with interest Halton's accusation that Sky's stance is opposed to the "public interest". A charge levelled at YouView itself but dismissed by Ofcom and sidestepped rather by the BBC Trust when it gave provisional clearance for the project last year. Leaving observers to ask at the time whether the BBC Trust is best placed to deliberate on a BBC-led project in the first place.

On the other hand, the UK's biggest commercial broadcasters, ITV, Channel 4 and Channel 5, are among the YouView consortium members - so it appears that most of the UK's TV content creators are on board.

Bob Wootton, the director of media and advertising at ISBA, can reveal that he's continuing to maintain a watching brief. ISBA has written to Ofcom about this matter but Wootton wants to emphasise unequivocally that it has not adopted a formal line per se. He says: "We are aware that there are questions as to whether the BBC Trust alone is a sufficient regulator in this instance. We feel it is appropriate for Ofcom to look at this."

But Marco Bertozzi, the managing director, EMEA, of VivaKi's Nerve Centre, says the market shouldn't lose sight of the big picture here. He states: "If anti-competitive means we will see the uptake of IPTV en masse, if anti-competitive means we will have free access to a range of great content when we want it, for free, if it means we will have a streamlined technical approach to this area and not a myriad of different players and if we can simplify the opportunities for consumers - then yes, it's anti-competitive, but worth it." And he adds: "Lets not repeat the likes of Joost - let's get it right first time. As advertisers, we should welcome a slick, rapid expansion of IPTV."

However, Nick Suckley, a managing partner at agenda21, is not entirely convinced: "From a purely UK market perspective, there's a massive potential for this to be uncompetitive. I can see why many advertisers are worried that it may lead to monopolistic trading practices. On the other hand, I think it will deliver a good consumer experience - and I don't buy the Sky argument that it will stifle innovation. Meanwhile, there's a real risk that, while this parochial UK spat continues, Google will enter the market and clean up - and I don't think that would be good for the UK television business."

Lorenzo Wood, the chief technology officer at LBi, says he can see why Sky and Virgin are doing what they're doing - but he doesn't really believe they have a public-interest case. He concludes that it will be difficult for any proprietary platform to acquire a sustainable dominant position in this rapidly evolving market: "The explosion of interest in mobile has led to more websites optimised for mobile. The web and TV is set to follow a similar pattern. The web on my TV today is not much fun, but it has the potential to adapt quickly and in an open way - and I can't imagine proprietary platforms winning out in the medium term."

MAYBE - Bob Wootton, director of media and advertising, ISBA

"It is our view that Ofcom would be well placed to offer a more complete regulatory perspective. But we are not saying that YouView is anti-competitive. We are not taking a position."

NO - Marco Bertozzi, MD, EMEA, VivaKi Nerve Centre

"The YouView group is required to be open to help grow opportunities for other companies to join and the BBC has to answer to its Trust, so I feel enough steps have been taken to make sure it plays fair."

MAYBE - Nick Suckley, managing partner, agenda21

"There's a danger that we'll lose sight that this should be about what's best for the UK consumer. Some of Sky's concerns are legitimate. Surely it should have been involved from the beginning?"

NO - Lorenzo Wood, chief technology officer, LBi

"YouView raises public expectations of what modern TV can deliver. Negative PR and legal activity are cheap ways for Sky and Virgin to seek to maintain their competitive position for longer, by holding the competition back. As a public-interest matter, it's moot."

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