Lovefilm and Netflix “far from clear” threats to Sky, says Ofcom

Ofcom has provided comments on the Competition Commission’s working paper and research report on the pay-TV market. In its comments, Ofcom recommends that Netflix and Lovefilm “should be viewed in context and that their potential market impact should not be overestimated,” because the competition they pose to Sky is “far from clear.”

Through its contracts with the six major Hollywood studios, Sky controls almost all first subscription pay-TV window movie content in the wholesale market, according to the Competition Commission’s provisional findings. Moreover, Lovefilm and Netflix’s subscription video on demand services are not believed to be substitutes for this content: the two offer mainly non-recent television series.

Since Ofcom believes that first subscription pay-TV window movie content is the “key factor” in competition for the pay-TV sector, Sky still has a stranglehold on the market.

Full content: The Guardian

Related content: Are Media Markets Analyzed as Two-Sided Markets? (John Wotton, Allen & Overy)

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