BBC, ITV and Channel 4 broadband TV joint venture Kangaroo is facing stringent criticism from industry rivals, who are petitioning the UK Office of Fair Trading (OFT) to investigate the service to ensure it is not anti-competitive.
The OFT has opened comments on Kangaroo, asking industry stakeholders to provide opinions on its possible effect on the growing online TV marketplace. Rival online TV platform operators Virgin Media and BSkyB say that the OFT needs to closely monitor Kangaroo, as the partnership of major broadcasters “raise concerns” that the platform could become a monopolising entity.
BSkyB says a major issue is whether content from the broadcasters is made available to both Kangaroo and competitors, with the possibility that material created with public subsidies for traditional broadcast is then transformed into on-demand content exclusive to Kangaroo.
Another concern raised is whether Kangaroo will receive cross-promotion from the publicly-subsidised operations of the broadcasters, providing a significant advantage over Virgin and BSkyB efforts.
The OFT is also being asked to investigate the advertising ramifications of Kangaroo, with a single advertising operation expected to leverage resources from BBC, ITV and Channel 4 for the platform. Rivals say a similar venture would not be allowed in traditional media, such as terrestrial TV, and the creation of a broadband TV entity with market-controlling advertising strength is a definite threat to competition.
The OFT is expected to review the venture and either provide direct recommendations or refer it to the Competition Commission for further review.