Virgin Media mounts legal challenge to Sky-ITV ruling

by Daniel Farey-Jones, Brand Republic 25-Feb-08, 14:55

LONDON - Virgin Media has followed BSkyB in lodging an appeal against the Competition Commission's ruling that the satellite broadcaster has to reduce its stake in ITV below 7.5% -- only Virgin is arguing that Sky should be forced to go lower.

Virgin Media says it supports the commission's decision that the stake is anti-competitive, but that its proposed remedy, which was approved by the government before Sky appealed its decision, is not adequate to solve the problem. It is believed to want Sky to be forced to get rid of all its ITV shares.

Virgin Media, in its previous incarnation as cable operator NTL, was frustrated in its attempts to buy ITV by Sky's acquisition of 17.9% of its target in November 2006.

Its intervention comes four days after Sky announced its appeal against the commission's ruling on the grounds that it was wrong to conclude there was a merger situation worth investigating and wrong to force Sky to reduce its stake.

Virgin Media is also appealing against the commission's conclusions that the acquisition of the stake has not materially affected the sufficiency of plurality in the UK's news media.

Virgin Media said: "BSkyB, together with its leading shareholder News International, and ITV are both very significant providers of news in the UK."

The appeal opens a new front in Virgin's legal and regulatory battles with its rival. It is going to the High Court over Sky's decision to pull its channels from Virgin's subscription package and was one of a band of pay-TV companies that asked Ofcom to investigate the pay-TV market last year.

Virgin Media customers lots channels such as Sky One and Sky News, leading many to abandon the cable firm in favour of Sky.