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Ofcom receives another YouView complaint

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YouView
Electra Entertainment, a UK-based IPTV service provider, has complained to media regulator Ofcom that YouView will "damage" the UK's interactive TV sector.

Electra has developed an IPTV platform, called Trove, which brings rich media services to the TV screen. It is currently available on Tesco-branded Freeview set top boxes.

YouView, which was formerly known as Project Canvas, will aim to upgrade the Freeview and Freesat platforms to support video on-demand and internet services when it launches next year.

However, Electra believes that "the proposed vision, shareholder structure and aims of YouView are anti-competitive and significantly damage the UK interactive TV market".

The company said that the YouView partners - the BBC, ITV, Channel 4, Channel 5, TalkTalk, BT and Arqiva - are all "major players" in their fields and have the potential to form a "market monopoly for the provision of free and micro-pay TV services".

Pointing to the involvement of the licence fee-funded BBC, Electra said that YouView's software architecture is "state-aided" and its technology standards lack transparency.

The firm also claimed that YouView's estimated initial marketing budget of £48 million is a "major cause for concern amongst venture capitalists looking to fund competing private British businesses in this emerging broadband TV sector".

Jasper Smith, Electra's chairman, said: "We've spent many years developing our technologies and sourcing funding for Trove to be one of the most advanced connected-TV platforms available today to accommodate the changing needs of the interactive and Internet TV industry. Whilst we welcome competition with open arms, like any business, we can only compete in a fair and open market place.

"The actions of the YouView partners and in particular the BBC have disrupted the normal commercial and competitive cycle of innovation, investment and potential reward that is fundamental to the development of new enterprise within the capital markets. We are urging Ofcom to act."

In response, a YouView spokeswoman said: "It is important to consider the overall market impact of YouView, in particular the positive benefits that this will bring to the wider market and the end consumer.

"YouView will create significant new opportunities for content providers and grow the overall market for connected TV, with specific benefits for the consumer electronics market.

"YouView is a much-needed upgrade to DTT in the UK and critical to maintaining healthy competition and a choice of TV platforms. Without it, we will fail to offer an alternative to those people that currently cannot, or choose not to pay for TV services."

Yesterday, YouView dismissed claims that it will harm UK IPTV businesses after a study indicated that investment in the sector has declined by more than 90% since the launch of Canvas in September 2008.

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