Key cabler's BSkyB deal could trigger dispute

LONDON — Cable & Wireless Communications, the U.K.’s largest cable operator, is believed to be in advanced negotiations with British Sky Broadcasting on a deal that would see the satcaster supply the cabler with pay-per-view movies.

Such a move would hinder the cable industry’s ability to launch its own pay-per-view service, as it is considering doing. CWC’s actions are thought to have triggered a major dispute between the cable operators.

Telewest, Britain’s second-biggest operator, has been aggressively seeking a pay-per-view deal with the Hollywood studios. Without CWC on board, those plans would seem to be compromised.

Although CWC would not comment, a Telewest spokesman said: “It wouldn’t surprise me if they’ve done a deal. It would be nice if CWC were part of the party, but it doesn’t preclude us from pressing ahead.”

Sky News not falling

CWC has, however, indicated that it will not drop the Sky News channel despite the fact that it, like virtually all of the cable industry, has agreed to carry the BBC’s new 24-hour news service.

There has been considerable speculation that the operators would dump Sky News in favor of the BBC channel, which is a free service (Daily Variety, Aug. 29).

The U.K. cable industry has also been pressuring BSkyB to unbundle the channels it provides to the operators. The satcaster supplies the industry with its most important programming — movies and sports.

Britain’s commercial TV regulatory authority, the ITC, is currently assessing whether BSkyB’s channels should be unbundled, and disunity between CWC and its peers could impact the issue.

Research conducted by the cablers points toward unbundling facilitating better penetration. At present, only 22% of cable-ready households in the U.K. have taken it up.

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