UK Regulator Clears Murdoch’s BSkyB of ‘Margin Squeeze’

18 December 2002

Following a three-year probe by Britain's Office of Fair Trading, News Corporation-controlled satellite pay-TV platform BSkyB has been absolved of breaching competition law.

The decision caused considerable surprise among industry observers; even, it is said, BSkyB executives. However, there are few arched eyebrows among students of the British government’s eagerness to appease NewsCorp’s quartet of election-tilting national newspapers.

The OFT reversed its own finding of twelve months ago when it opined that the satellite broadcaster had infringed the Competition Act over the prices it charged retailers of its television channels – the now bankrupt ITV Digital and similarly cash-strapped cable groups NTL and Telewest.

According to OFT director general John Vickers: “On the key issue of the alleged margin squeeze against rivals we found BSkyB to be around the borderline of anti-competitive behaviour.” But, he said: “[Overall] there are not sufficient grounds to conclude that BSkyB has broken competition law.”

Said BSkyB piously: “After an investigation lasting nearly three years, BSkyB welcomes confirmation that its conduct has not infringed the Competition Act.” Rival Carlton Communications declared “surprise and disappointment” at the decision.

Data sourced from: Times Online (UK); additional content by WARC staff