TellyWars.com

The basic lowdown

VirginMedia bought NTL:telewest recently, taking over their cable service market share in the UK.  On March 1st 2007, the deal that NTL:telewest had with BSkyB to provide Sky One, Sky News and Sky Travel expired - while Virgin and Sky had been negotiating a continuation of this deal, nothing was agreed upon so all VirginMedia (NTL:telewest) customers lost their access to these 3 channels.

A variety of marketing efforts and press spin was promptly launched by both companies in an attempt to leverage market share from the other.

VirginMedia’s stance on things

On their site, VirginMedia claim that Sky were demanding close to double the fee for access to these channels, “despite the channels falling in popularity by around 20% over the past 3 years”.  As such, no deal was made.

VirginMedia go on to argue that paying these prices would be unfair on their customers (as it would mean price increases) and they didn’t want to see their customers being “ripped off”.  After this refusual, Virgin state that Sky “withdrew their services” (which could be slightly melodramatic as it’s more likely to be a simple contract end).

In addition to this, Virgin claim that Sky “forced” them to accept an 85% reduction in price for Virgin channels such as Bravo and Living, despite an increase in popularity.

Abusing their market share

Virgin have taken several steps to rectify the situation to be able to “offer basic packages at a reasonable price”:

• They offered to let an independent party judge the prices - Sky refused.
• On the 5th Of March, Virgin advised Sky that if they didn’t come to an agreement they would take them to the High Court for abuse of their market dominance.
• This court action will seek to provide basic channels for both providers at a fair price.

Virgin also state, “it’s time to stop arguing and take action”.  Well Mr Branson, that’s why TellyWars.com is here too!

New channels from VirginMedia

To replace the lost channels, Virgin have offered a new free on demand channel that allows users to view a small selection of TV programmes (such as The Office and Nip Tuck) for free at any time.  On top of this, Virgin are releasing music videos onto the service (leveraging on aspect of their unique market advantage) and assure users that they will be adding series 3 of Lost to their on demand service later in the year.