BBC and Sky executives are said to be meeting today to discuss next steps.

Relations are said to be frosty since the BBC said it would dispense with the services of Sky's encryption services earlier this month. The move, expected to save the BBC £85 million over five years, is not without potential for some fraught and frank discussions between the parties.

Assuming that Sky don't offer the BBC a deal on encryption the areas of issue will be:

The position of BBC 1 and BBC2 on the EPG at 101 and 102 and how to change the software to allow users to select their region into that position in the EPG.

This is a software update that the BBC have said they are prepared to pay a reasonable amount for. The potential sticking point is what is reasonable.

Any attempt by Sky to move the BBC channels elsewhere in the EPG is likely to be challenged by the BBC, who will go to the ITC for enforcement.

As reported Sky doubled the costs of non encrypted EPG entries but this isn't something the BBC are complaining about - while other broadcasters are challenging the new fees with Oftel.

Finally the decision of the BBC to move from encryption leaves the other public service broadcasters in a slight quandary. Currently the BBC pays for cards for people who do not have a Sky subscription and that card is used to decrypt ITV, C4 and C5. Once the BBC stops this service anyone who does not have a Sky subscription would no longer potentially have access to these services.

The next month or so is likely to see a substantial amount of negotiations on this front - follow the details on Digital Spy.