U may do U-turn in U.K.

Second U.S. co. to threaten move if cable unbundling proceeds

LONDON — Universal may choose not to base its new European headquarters in the U.K. if the unbundling of cable and satellite TV channel packages goes ahead.

The threat is the latest protest against plans by the ITC, the British commercial TV regulatory org, to end channel packaging, which it views as anti-competitive. Viacom recently said it could leave Britain if unbundling proceeds (Daily Variety, May 8).

Niche channels in the U.K. are at present guaranteed at least 80% carriage to cable and satellite subscribers, and fear that unbundling — which lets subscribers pick and choose which channels they buy — will adversely impact distribution.

Universal, parent of the Sci-Fi Channel, is planning to launch two channels in Britain in 1999 — 13 Street and Studio Universal — and is poised to invest millions in building a broadcasting center.

A Universal spokesman told Daily Variety that the studio was “in a period of watching and waiting” but was “considering quite seriously” setting up operations on the continent if it felt its U.K.-based channels were threatened.

“London is a logical location, but other people would be happy to have us,” the spokesperson said, pointing out that Universal already had bases in Rome, Paris and Munich.

For its part, the ITC is holding its ground, describing the aggressive lobbying of niche broadcasters and niche channels as “public posturing.”