OFT clears cable merger, Sky's Easynet purchase

The Office of Fair Trading has given the green light to both the proposed merger of NTL and Telewest and Sky's acquisition of Easynet.

In deciding on the cable merger, the OFT noted that the local networks of the respective companies do not overlap, except in the already-competitive areas of wholesale telecoms and narrowband internet. It dismissed potential concerns that the new entity could cease to supply Flextech content to DSL rivals on account of its "relatively low share of viewers" and the availability of alternative content.

Meanwhile, Sky's £211 million takeover of the VOD firm - enabling it to launch a triple-play offering in 2006 - is expected to "benefit consumers", the OFT said.

It added: "Competition between Sky and Easynet is currently insignificant but third parties have raised concerns about the potential for Sky blocking the supply of pay TV content to its emerging DSL rivals given its market power in premium content provision and its significant buyer power in non-premium content." The regulator dismissed these concerns on the basis that Sky already has the potential to undertake such practices.