Sky1, Sky News back on Virgin cable

Sky's bouquet of basic TV channels including Sky1 and Sky News are to return to Virgin Media's digital cable service on November 13.

The broadcasters have reached two separate agreements for the carriage of the Sky basics package on Virgin and Virgin Media Television's Living, Bravo, Trouble and Virgin1 bouquet on the Sky electronic programme guide.

Full commercial terms were not disclosed but the agreements include annual carriage fees plus additional capped payments subject to performance-related targets. Both deals expire on June 12, 2011.

The Sky basic channels will be spread across each tier of Virgin's cable TV service: Sky3, Sky News and Sky Sports News will be available in the lowest M tier; Sky1 and Sky2 will be available in the L tier; and Sky Arts 1, Sky Arts 2, Sky Real Lives and Sky Real Lives 2 will join the XL tier.

"We are pleased to bring our carriage negotiations with Sky to a successful close," said Virgin Media CEO Neil Berkett. "I believe this agreement represents a fair deal and is the right thing for our customers. We recognise the quality and popularity of Sky's channels and look forward to welcoming them back to Virgin Media's TV service. We are also pleased to secure Sky's continued carriage of the Virgin Media Television channels until June 2011."

"This is great news for Sky and Virgin Media customers alike," said Sky CEO Jeremy Darroch. "We want our channels to be enjoyed by as many people as possible so we're delighted to secure their return to the Virgin Media platform."

In March 2007, Sky's basic channels were pulled from Virgin's cable service after a protracted carriage dispute resulted in an existing agreement being allowed to lapse. Virgin accused Sky of "doubling" the price of its channels, a claim denied by Sky, which suggested that Virgin customers displeased by the removal of Sky1 and Sky News should join Sky instead. Last April, Virgin filed a suit against Sky at the High Court, demanding that Sky's channels be supplied at a "reasonable commercial rate" and alleging that Sky abused its position in the pay TV market by forcing Virgin to accept an 85% cut in payments for the Virgin Media Television channels' carriage on Sky's EPG. Relations thawed this March, however, when it was revealed that carriage negotiations had restarted.