CSI: Ofcom — the Sky / Virgin Media battle continues
The MediaGuardian this morning* continues its coverage of the Sky / Virgin Media dispute in light of Virgin Media’s dismal 1Q07 results. Richard Wray writes:
Virgin Media lost nearly 47,000 customers in the first three months of this year and warned yesterday that more were likely to follow after the decision by BSkyB to pull channels including Sky One from the Virgin service two months ago.
The cable TV company, in which Sir Richard Branson’s empire has a major stake, suffered an exodus of telephone customers in the first quarter of the year, in the face of fierce competition from services such as Carphone Warehouse’s TalkTalk with its “free” broadband offer. Now Virgin Media faces the departure of thousands of disgruntled TV subscribers after its bitter rival Sky stopped providing cable households with basic Sky channels on March.
I’ve generally sided with Sky in this matter, at least in the sense that I think the dispute over the television channels in question is not an important regulatory or competition law matter. It simply requires what Warren Buffet calls an honest-to-God negotiation. The MediaGuardian also have not fallen for the same line we have heard in other places — wrongly attributing every Virgin customer loss to the Sky dispute.
Virgin Media have also not done themselves any favours by filing a secretive complaint document with Ofcom, and then on-the-other-hand publicly claiming that ‘consumers have a right to understand more about the facts behind the headlines and what Virgin Media is doing to put things right. The numbers behind Sky’s pricing proposals speak for themselves and reveal the extreme nature of their behaviour.’
Actually, numbers don’t speak for themselves. People have to read them. I asked Virgin Media for those facts twice, and both times received no response whatsoever. I’ve also been told that even Sky has been denied access to the Ofcom complaint. Let’s face it, these are not nuclear secrets — it’s just television. Virgin’s refusal to put its case forward to the people that matter — the viewers — means to me it’s probably not very compelling. I’m willing to listen to Virgin, but I have this crazy problem of thinking for myself, and not being convinced by self-serving press releases.
So, I have a double problem here: First, the loss of these television channels from the Virgin Media platform — mainly containing content that can be purchased competitively — is not an important regulatory or competition law matter. Second, even if it is an important matter, the total secrecy surrounding the Ofcom complaint is not warranted.
*By the way, the new look Guardian Unlimited website is excellent.
I don’t side with Sky at all on this. The size of the Sky corporation and it’s position as both a competitor and supplier of channels allows them to ‘negotiate’ from a totally monopolistic position and it is clear both in the unfair increasing of price and their dubious purchase of stakes in ITV they are going to make damn sure they keep their monopoly. The reason we only have one satellite supplier and its only real alternative is an ailing cable supplier is because OFCOM has chickened out of tackling the issue of decoupling content producing from broadcast supply in the same way they have with the telephone / internet industry. In my line of work I would never countenance using a massive competitor as a primary supplier but that is what any potential cable or satellite supplier is forced to do.
Thi si my business address, my personal email address has become temporary – I am yet another fleeing from Virgin Media’s dreadful customer service.
If one uses an internet search engine to look for “Virgin Media Customer Falls” – as well as this site – one finds dozens of leads detailing stories of terrible, appalling and commercially indefensible customer relations by Virgin Media.
In these circumstances it is impossible to have any sympathy with Virgin Media’s published statements, not least because all the accumulated evidence suggests that they are not to be believed. Until have demonstrated that they can treat their own customers honourably, why should they have any protection or support froma regulator whose umbrella they seek to otherwise evade?
Much more basic and to the point – what is the point of a Regulator who apparently cannot, and or will not, control the ruthless exploitation of end customers by a major supplier to the marekt in which, allegedly, they exist to protect the interest of the Public?