Sky, Virgin carriage dispute still unresolved

Sky's portfolio of entertainment channels remain unlikely to return to Virgin Media in the immediate future after a new attempt at a resolution fell flat.

According to letters between Sky CEO James Murdoch and his Virgin counterpart Steve Burch - released by Sky on Friday - Sky put forward a new proposal on Thursday, May 10 "in an effort to break the impasse".

"Our new offer is that we simply split the difference between each party's last offer in respect of the carriage of our basic channels," wrote Murdoch. "We hope that you will accept this proposal and meet us in the middle so that we can rapidly complete a legally binding agreement that enables the return of Sky's basic channels to Virgin Media's customers within days."

A week later Burch confirmed in writing, according to Sky, that the firm was "fully prepared to negotiate" further but was rejecting the new offer.

"As a result, Sky believes that there is now little prospect of Virgin Media agreeing to restore Sky basic channels to its network, at least for the foreseeable future," said a Sky spokesman. "Sky regrets this outcome and the disappointment caused to viewers in cable homes."

Virgin said that the leak of the letters had been deliberately timed to coincide with an impending ruling on the legality of Sky's purchase of an 18% stake in ITV.