Virgin Media to Appeal BSkyB/ITV Ruling

LONDON, February 25:
British cable giant Virgin Media has said that it too will file an appeal
against the Competition Commission’s ruling on BSkyB lowering its stake in ITV,
arguing that it doesn’t go far enough.

Last week, BSkyB mounted a
legal challenge against the findings of the Competition Commission's report on
its investment in ITV and the subsequent ruling that it should lower its stake
from 17.9 percent to under 7.5 percent. John Hutton, the Secretary of State for
Business, Enterprise and Regulatory Reform, based his decision on the findings
of a Competition Commission report that found that the Sky/ITV deal would
result in a substantial lessening of competition in the British market.

Virgin Media announced
today that it is filing an appeal with the Competition Appeal Tribunal
requesting a review of the Competition Commission conclusions, noting that the
move reflects the platform’s “commitment to fight for a more dynamic and
competitive media landscape in the U.K.”

Virgin Media itself was
looking to acquire ITV when Sky announced its investment in the broadcaster in
November 2006. The quad-play platform maintains that Sky’s actions “were
intended for the sole purpose of preventing the emergence of a stronger
competitor and are against the public interest.” Moreover, Virgin Media says
that reducing the stake to below 7.5 percent is not adequate to address the
problem. Virgin Media is also appealing the Competition Commission's
conclusions that the acquisition has not “materially affected the sufficiency
of plurality in the U.K.'s media.” BSkyB and its major shareholder, News
International and ITV are both “very significant providers of news in the
U.K.,” Virgin Media says. "BSkyB's stake in ITV is exactly the kind of
scenario that the media plurality provisions of the Enterprise Act 2003 were
designed to address. This is the first time that these rules have been tested
and Virgin Media believes the Competition Commission has made significant
errors in interpreting and applying these rules."

—By Mansha Daswani