[Rich]

And this is on the PR Newswire:

LONDON, February 27 /PRNewswire-FirstCall/ -- In this morning's edition
of the Daily Telegraph BSkyB claims to have offered Virgin Media
significant concessions and a new annual price of 90 pence per subscriber,
or GBP32.4 million, for carriage of its basic channels on Virgin Media's
network. They maintain that this represents an increase of 19 per cent on
the existing arrangement.
Sky is blatantly misrepresenting their offer, which specifically
provides for a minimum guaranteed annual payment that is twice the current
annual payment. Under Sky's proposals, there are no circumstances under
which Virgin Media would pay anything less than this doubled amount. The
pence per subscriber figure they quote is simply not applicable because of
the minimum guarantee.
Sky wishes to double the cost of the existing arrangement for a
portfolio of channels whose popularity has declined by 7 per cent every
year for the past three years. Moreover, Sky has demanded that Virgin Media
remove their basic channels from our entry level TV package (which is
available for free with any other Virgin Media product). This means that,
even were terms agreed, Virgin Media would be forced to deprive a
significant proportion of their subscribers of Sky's basic channels. This
is nothing short of an attempt to stop Virgin Media giving consumers a
better deal so that Sky can maintain their monopolistic position in the
market.
We find this selective use of facts disingenuous and misleading, but
hardly surprising. It confirms our view that Sky have no intention of
agreeing a deal on sensible commercial rates and that a withdrawal of these
channels is an outcome which they are deliberately trying to engineer in
order to suppress competition.
In justifying their demands, Sky has emphasized their additional
investment in their basic channels. In reality their investments have
failed and over the last 5 years they are the worst performing general
entertainment pay TV provider on our network. Like any good monopolist, Sky
apparently wants to be rewarded for failure.
Virgin Media has offered Sky a generous increase on the existing fee
arrangement, in return expecting only to receive the same product that Sky
makes available to its own customers. We remain open to any genuine offer
at any point up to expiry of the existing contract.
Part of the background to this dispute is the significant investment in
new and exciting programming by Virgin Media over recent months.
The dispute concerns the carriage of Sky's basic channels: their sport
and movies channels are unaffected and will continue to be available to
Virgin Media's customers.
Steve Burch, Virgin Media's CEO said: "The latest offer from Sky is
nothing more than smoke and mirrors. They continue to demand a price for
their basic channels that demonstrates a determination to use their market
power to bully competitors and enforce pricing that bears no resemblance to
commercial reality".
Notes to Editors
Virgin Media is an innovative and pioneering UK entertainment and
communications business. For the first time consumers can get everything
they need from one company - the UK's only quad play of TV, broadband,
phone and mobile plus the most advanced TV on demand service available, the
UK's first high definition TV service and V+, our high specification
personal video recorder. We're the UK's most popular residential broadband
provider, the largest virtual mobile network operator and the second
largest provider of pay TV and home phone.
Virgin Media owns two content businesses - Virgin Media Television
(VMTV) and sit-up. VMTV owns seven entertainment channels - Living, Living
2, Bravo, Bravo 2, Challenge, Trouble and Ftn - and is a 50% partner in
UKTV which consists of ten channels including UKTV Gold and UKTV History.
Sit-up runs retail TV channels bid tv, price-drop tv and speed auctiontv.
Virgin Media is the largest Virgin company in the world and has almost
10 million customers. To find out more visit
http://www.virginmedia.com/presscentre
Media contacts
Virgin Media:
M: Communications, Nick Fox and Lisa Gordon +44-(0)207-153-1540/1548
John Moorwood, Virgin Media, +44-(0)1256-752-670 or
[email protected]