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“We confess ourselves slightly perplexed,” BSkyB (NYSE: BSY) finance chief Andrew Griffith told Wall Street investors, when asked about the Competition Commission’s judgement that Sky Movies is anti-competitive in the on-demand movie space.
“The movies market has never been more competitive,” Griffith told UBS’ Annual Media and Communications Conference in New York.
“Sky has never traded on exclusivity. Every movie that’s ever been on Sky Movies has had a theatrical release and has been in Asda or Tesco well before it has been on Sky.
“The average consumer only has to spend 15 minutes on the internet to realise just how competitive the landscape is, including companies like Netflix.”
The Competition Commission provisionally ruled Sky Movies’ exclusive pay-TV 1 window deals with six Hollywood studios anti-restrictive. It has proposed breaking up those rights or forcing Sky to offer rivals like Netflix (NSDQ: NFLX), Lovefilm and Blinkbox to its own satellite customers.
Griffith was also asked if BSkyB could offer bouquets like Sky Sports to platforms like YouView, so that consumers would not require its satellite boxes.
“YouView doesn’t have a lot of linear capacity, and sport is the hardest to reproduce on an on-demand basis.
“If there’s demand out there from people who don’t want a dish and a box and just want to be able to subscribe to Sky Sports on-demand, there’s no reason at all why we won’t be in the marketplace giving them that service.
“We are today. The reality is that market right now is not very large. Anecdotally, it’s students in their dorm room using a laptop.”
Griffith also gave a gloomy UK economic indicator – he expected Q4 advertising sales to be “flat to down”, with December the weakest month of the quarter. That is disappointing since December is chock-full of Christmas ads. But advertising is only five percent of Sky revenue.
Sky will buy back up to £750 million in its stock to return to investors, Griffith said, following the shelving of News Corp.’s bid to buy out the remaining piece of the company.