LONDON: Although the UK Competition Commission's decision to veto Project Kangaroo (the video-on-demand service from BBC Worldwide, ITV and Channel 4) may have delighted NewsCorp's UK satellite monopoly BSkyB and its US-owned cable counterpart Virgin Media, it has disappointed the nation's ad agencies.

But there is a degree of ambivalence in the response from the Institute of Practitioners in Advertising – the body representing UK ad, media and marketing communications agencies. 

Admits IPA director of media affairs Geoffrey Russell: "We found ourselves torn between the desire to see the VoD area grow as a result of Project Kangaroo raising the sector's profile with the consumer, and the dangers of allowing the creation of a giant which might subsequently exploit its dominant position to the detriment of advertisers and viewers."

Nonetheless, says Russell: "We are disappointed that the opportunity, which Kangaroo offered for growing the VoD market appears to have been blocked; but would still hope that some means might be found, whereby fears over the availability of original material to other channels in the marketplace might be overcome."

The IPA argues that the extent to which Kangaroo posed a real danger [to VoD competition] depended on satisfactory answers to two inter-related areas:

  • The constraints placed on Kangaroo to ensure the availability to others of the original programming supplied by its founding partners. 
  • The extent to which advertising within downloads from the Kangaroo participants was sold individually and in competition - and what safeguards might be put in place to ensure this actually took place.
Russell said that the IPA was reassured with regard to the last of these points, but acknowledged that the proposals put forward by Kangaroo's sponsors about the availability of original programming "were clearly insufficient to offset the Competition Commission's concerns".

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