[Community Television] Murdoch moves to take on Freeview

[Michelle McGuire]

Murdoch moves to take on Freeview
10 June 2004 08:24

BSkyb chief executive James Murdoch this week unveiled plans for a 
200-channel free-to-air digital satellite package in a dramatic 
departure from Sky’s pay-TV business model.

The subscription-free service, which will not be branded Sky, will 
launch later this year for a one-off payment of £150. The package 
contains 116 TV channels including all the free-to-air channels, such 
as the five terrestrial services, news offerings including Sky News and 
shopping channels, along with 81 radio stations.

The move will put Sky in direct competition with Freeview to attract 
the 47% of homes that have so far resisted the appeal of multichannel 
services.

The announcement is seen as a major defensive move to counter the 
digital terrestrial TV service. Freeview, a joint-venture between the 
BBC and Sky, has attracted 3.5 million customers since its October 2002 
launch with boxes now selling for less than £50.

Sky’s move has also been orchestrated to pre-empt a planned free-to-air 
satellite proposition being developed from the BBC.

The corporation is looking for government support for a so-called 
Freesat service and Sky’s move may not prevent the launch of a rival 
service.

BBC sources said it intends to continue with its plans in spite of 
Sky’s announcement but could eventually team up with the satellite 
operator on the venture. "We are still talking to Sky about how we 
might work together on this," a source said. "It might be that we end 
up co-operating."

BBC director of marketing, communications and audiences Andy Duncan 
welcomed the move and said a free satellite offering was "an important 
missing piece in the jigsaw to achieving a fully digital Britain".

But he also refused to rule out the BBC being involved in a rival 
offering. "Whether this ends up being the only (satellite) service, I 
don’t know. But it’s possible other interests will want to offer their 
own free-to-view satellite service."

Customers of the free Sky service will be served by the same EPG as 
Sky’s subscription customers, who pay up to £40 a month for premium 
content such as football and movies.

All the Sky boxes in free satellite homes will have the capability of 
being upgraded to existing Sky packages and the satellite giant will 
use the customer database to try and convert them to pay-TV packages.

Sky also revealed this week that it planned to launch a new high 
definition (HDTV) service which will offer a premium package of 
channels in the high-def format.

Murdoch said: "These initiatives are another step in giving consumers a 
choice from Sky that suits their needs at the top and lower ends of the 
scale. They will help drive even greater take-up of digital TV."

Source: broadcastnow.co.uk