OFT closes case on Sky

The Office of Fair Trading (OFT) has closed its investigation into Sky's pricing policy in a move which has outraged licensees and pub operators.

The competition watchdog has announced that it will not be proceeding with a complaint lodged by the Association of Licensed Multiple Retailers (ALMR) about Sky's pricing policy on pubs.

The OFT has closed its file on the subject concluding that there are insufficient grounds to suspect Sky had breached the Competition Act.

Nick Bish, chief executive of the ALMR, said: "We are disappointed that the OFT will not be taking any further action in this area. We argued strongly that the recent increases imposed on pubs meant that prices were unnecessarily high and that this breached the Competition Act."

In July 2003, Sky hiked its fees by up to 25 per cent, while the latest charge for Sky's pay-per-view season ticket doubled on the previous season.

The OFT acknowledged that the company's prices were high but not excessive and, therefore, not illegal.

Mr Bish added: "We accept that the Competition Act 1998 sets very high hurdles but for many of our members this will appear to be legal semantics. At the end of the day it is pub profitability that is being eroded as a result of these high prices."

A spokeswoman for Sky said: "Sky believes its pricing is fair and is pleased the OFT has now closed the case."

However, Danny Scott, licensee of Rick's Bar in Greenwich, London, said: "I can't believe it. I really thought this year after the stink we kicked up, the OFT would bring Sky to book. But I shouldn't be that surprised. Sky has got a licence to do what it likes."

And Christine Desborough, licensee of the Friendship Inn, Ashton-Under-Lyne, in Lancashire, said: "The decision is ridiculous. I couldn't afford the season ticket this season and I barely break even with my current subscription to Sky. Yet if I don't have Sky Sports, I'll get even fewer customers. It's a Catch 22 situation."

An OFT spokeswoman said: "Having fully considered the complaint from the ALMR, we do not believe that there are reasonable grounds to suspect that there has been a breach of the Competition Act and so believe a formal investigation is not justified."

Sky high price rises​

• Sky's prices rose by up to 25 per cent in 2003
• Sky's season ticket (pay-per-view) rose by 100 per cent
• Not accounting for last year's price hike, since 1996 Sky prices have risen between 200 and 800 per cent
• If the TV licence had risen by the same amount it would be between £269 and £877 instead of £116
• An average pint would be between £5.17 and £17, instead of £2.11.

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Sky loses football rights (17 December 2003)

Premier League seeks Sky settlement with EC (8 December 2003)

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European Commissioner may rule Sky deal 'unlawful' (12 November 2003)

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Sky gets Premier League football until May 2007 (11 August 2003)

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