Sky told to end public service retransmission fees

The UK government plans to end controversial retransmission fees that British public broadcasters pay to News Corp-backed satellite TV platform BSkyB for carriage.

A new report released the week by the Department for Culture, Media and Sport recommends the fees be stopped to bring the arrangement between Sky and the PSBs in line with “zero net charge” deals in place with cable operators such as Virgin Media.

Sky currently receives fees totalling nearly £10 million (€11.5 million) to transmit the PSBs channels – the BBC, ITV, Channel 4 and Channel 5 – on its platform, whereas cable operators receive nothing.

All UK platforms are obliged to carry public channels, which are in turn required to produce certain types of content in the public interest.

“The Government wants to see zero net charges, where the fees for access to the main platforms and for PSB channels cancel each other out. This is not too far removed from the current market position, and recognises the benefits to platforms, the PSBs, and audiences from being able to access award-winning, PSB content,” the Connectivity, Content and Consumers 2013 report stated.

The DCMS will launch a consultation in the autumn, “before bringing forward legislative proposals if required”.

The situation is unique to the UK market and in the US, Sky’s News Corp stablemate 21st Century Fox has actively campaigned against paying retransmission fees to cable operators for its broadcast channel Fox.

“Collectively the PSBs now pay less than £10 million a year in regulated platform charges, and this figure continues to fall.  We will continue our discussions with the PSBs about how the charges can be brought down further,” a Sky spokesman said. “At the same time, we welcome the Government’s recognition that Sky should not be required to pay the PSBs for content which is freely available on competing platforms and services.”