BSkyB’s ITV Stake Hurts Competition, Says British Regulator

LONDON, October 2: BSkyB may be
forced to shed its 17.9-percent stake in ITV, acquired last November, after the
U.K.’s Competition Commission said the satellite platform’s interest in the
commercial broadcaster “restricts competition and therefore operates against
the public interest.”

The regulatory authority issued a statement today noting
that Sky’s shareholding in ITV would be “likely to lead to a substantial
lessening of competition (SLC) by giving it the ability to influence ITV’s
strategy.”

The Commission says it will now consult on possible remedies
to address the adverse public interest finding, including possibly asking Sky
to offload the stake. The authority’s chairman, Peter Freeman, said: “The
acquisition has made BSkyB ITV’s largest shareholder by some margin and whilst
our provisional view is that this would not necessarily affect day-to-day
operations, BSkyB would be able to influence ITV’s key strategic decisions,
particularly relating to investment, whether in content, capacity or new
technology. As a pay-TV operator, BSkyB faces competition from the free-to-air
TV offer, of which ITV is an important part. BSkyB would therefore have both
the ability and incentive to take advantage of opportunities to weaken ITV or
prevent it from taking actions that would threaten BSkyB’s interests.”