Project Canvas makes OFT submission

The Project Canvas partners have made a merger analysis submission to the Office Of Fair Trading, as transmission firm Arqiva joins the venture.

In a pre-emptive strike to their critics, the partners - the BBC, ITV, Channel 4, Five, TalkTalk and BT - want to persuade the OFT that Canvas does not constitute a qualifying merger under the Enterprise Act 2002.

Canvas aims to create an open platform based on common technical standards for the delivery of internet-connected television to Freeview and Freesat households.

However, the project has faced criticism from Sky and Virgin Media that it will use public money to create a dominate player in the emerging IPTV market at the expense of commercial rivals.

Following the submission, the Canvas partners expect the OFT to launch a full consultation into the venture to judge whether it passes the 'merger threshold'.

Under the OFT's powers, it can ask the partners to amend their proposition or refer the entire project to the Competition Commission.

"The Canvas partners are clear that the joint venture does not qualify as a merger, and we welcome the opportunity to clarify this position formally," said Canvas project director Richard Halton.

Also today, Canvas has welcomed transmission firm Arqiva as an equal partner in the project. Not only does Arqiva handle the UK digital terrestrial television infrastructure, but it also owns video on-demand venture SeeSaw.

Welcoming the move, Halton said: "We are delighted that Arqiva have committed themselves to the project. They have a history of positive and progressive support for Freeview, and Project Canvas will benefit hugely from both their experience and engineering expertise."

Arqiva strategic development director for terrestrial broadcast Rob Hamlin added: "Arqiva has a long history in supporting free-to-air broadcasting as a shareholder in Freeview and provider of digital terrestrial television networks, so it is a natural step for us to take a partner role in Canvas.

"The approach of Canvas as an open platform based on common technical standards is one we fully support and are looking to encourage through standards bodies, particularly via the UK's Digital Television Group (DTG)."

The addition of Arqiva to the project could also help offset DTG concerns that Canvas is failing to properly engage with the wider digital TV industry.