Virgin Media acuses BSkyB

Televisionpoint.com Correspondent
British pay-TV firm BSkyB has abused a dominant position in its channel dispute with Virgin Media in a bid to damage its rival, the cable group said in papers submitted to the High Court. The two groups have engaged in a vociferous spat in recent months over how much the satellite operator should receive for allowing its channels to be shown on the Virgin Media cable system, media reports said.

The dispute resulted in BSkyB taking its basic channels, which show such hit programmes as Lost and 24, off the cable network, prompting Virgin Media to launch legal action in London's High Court. Virgin says it has launched the legal case to resolve the channel dispute and challenge BSkyB's dominance but competition lawyers have told Reuters it will be a difficult case to prove.

According to the papers submitted to the High Court and seen by Reuters on Thursday, Virgin Media said BSkyB engaged in abusive behaviour involving a disproportionate attack at the cable group as it is BSkyB's only material competitor.

"(The action was) designed to stifle the emergence of greater potential competition ... to strengthen BSkyB's dominant position on the pay TV retail market and pay TV purchasing market," the papers said.

Virgin Media, which was formed in February from the merger of NTL, Telewest and Virgin's mobile phone division, said the dispute would also harm consumers by leading to higher prices and less choice. The dispute involves the price Virgin Media pays for Sky's basic channels such as Sky One and Sky News and also the price BSkyB pays for Virgin Media's channels such as Bravo and Living.

Virgin said when discussing new contracts, BSkyB had initially offered to pay nothing for the Virgin channels while the final price offered to Virgin for the Sky channels was 105 percent higher for its content which included high definition and video-on-demand.

A spokesman for BSkyB disputed the claims, saying they contained "substantial factual inaccuracies and omissions," and called for Virgin to return to the negotiating table. "No one should draw conclusions after hearing only one side of the argument," he said.

The two groups first clashed when BSkyB bought a 17.9 percent stake in Britain's biggest commercial broadcaster, ITV after the-then NTL and Telewest group said it was looking at a bid for the company. That deal is being investigated by the regulators and Virgin Media has said it was anti-competitive.