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Ofcom rules out YouView investigation

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Ofcom has today announced that it will not launch an investigation into YouView, despite receiving numerous complaints about the IPTV joint venture.

In a statement, the media regulator said that fears about YouView's potential harm to market competition would be offset by its "benefits to viewers and consumers".

However, Ofcom also noted that the IPTV sector is still emerging, meaning the "impact of YouView on the market will not be known with any confidence for some time".

YouView, which is a partnership between the BBC, ITV, Channel 4, Channel 5, BT, TalkTalk and Arqiva, will aim to upgrade the digital terrestrial television platform to support internet-connected services when it launches next year.

The project also plans to create a set of common technical standards for companies making YouView branded set top boxes and connected TVs to deliver content via a unified user interface.

Virgin Media and IP Vision submitted complaints to Ofcom that the venture would potentially breach the Competition Act 1998. Ofcom also received submissions from 11 other parties, including Sky.

The complaints mostly argued that the venture, which launched in 2008 as Project Canvas, would give its partners incentives to "withhold content from competing platforms". They were also concerned that YouView would restrict competition between rival TV providers.

Despite having the power to refer the case to the Competition Commission for further investigation, Ofcom opted to dismiss the complaints.

The regulator said that it is "premature" to open an investigation into YouView, as "whether or not YouView and its partners will harm competition in the ways alleged will depend upon how this emerging market develops and how they act, particularly in relation to providing access to content and issuing technical standards".

Ofcom noted that there is "little evidence" at this stage that YouView partners the BBC, ITV, Channel 4 and Channel 5 plan to restrict access to their video on-demand content.

However, it added: "Given the possibility that harmful effects might emerge later, Ofcom will, nonetheless, keep the content syndication policies of the YouView partners under review."

The watchdog also acknowledged YouView's efforts to publish its technical standards for the industry, while fears about a restrictive user interface are not currently sufficient to warrant further investigation.

Ofcom therefore does not plan to investigate YouView under the Competition Act, but will continue to monitor developments closely, particularly in regards to the venture's sharing of standards and its content syndication practices.

Should evidence emerge that the operation of YouView could cause harm to viewers and consumers, Ofcom could reconsider its decision not to investigate in the future.

"Ofcom's view is that consumers' interests will not be served by opening an investigation," said Ofcom chief executive Ed Richards.

"It would be premature at the current stage of YouView's development given the absence of a clear risk of consumer harm. But if evidence does emerge in the future that YouView causes harm to the interests of viewers and consumers we may reconsider whether to investigate."

In response to Ofcom's decision, YouView chief executive Richard Halton said: "We have been clear throughout this process that YouView will stimulate competition in the TV platform market and create opportunities for content providers and device manufacturers. Most importantly it represents a great consumer proposition. We therefore welcome this decision from Ofcom.

"In a market dominated by pay services, we are creating the only mass market IPTV service that will be subscription free. All our efforts are now focused on launching a brilliant consumer product for launch next year. We look forward to broadening our engagement with wider industry partners over the coming weeks and months."

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