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Competition Commission Halts Project Kangaroo

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Competition Commission Halts Project Kangaroo

The final word has been awaited for a while now but after numerous set-backs we finally know that plans between the BBC, ITV and Channel 4 to create a joint digital media distribution service, called Project Kangaroo have finally been well and truly vetoed by the Competition Commission (CC). As Kangaroo's would-be collaborators said in a joint statement: "the real losers from this decision are the British public".

According to the CC Kangaroo would be "too much of a threat to competition in this developing market and has to be stopped." It would be childish for me to suggest the CC has confused a project which would have been extremely beneficial to the video-on-demand viewing British public with a real Kangaroo on a deadly rampage, so I won't.

As you might guess, I don't agree with the Competition Commission's decision. As I've espoused before, deeming Kangaroo anti-competitive when there is no competition in the first place seems a little off. Moreover, the BBC, ITV and Channel 4 have made numerous and reasonable proposals that would minimise the likelihood of Kangaroo being anti-competitive in the future, too. Even were its backers, in the CC's words, in "a very strong position as wholesalers of TV content to restrict competition from other current and future providers of video on-demand services to UK viewers."

Personally I see such a service as self-regulating. Buyers know how much they're willing to pay for VOD content and common sense dictates its originators should offer the lowest price for that content. Thus, having three of Britain's major content providers offering all of their VOD programmes via one portal is surely the best solution for all involved? Apparently not, though.

And you thought the Digital Britain Interim Report was depressing reading.

Link:

Competition Commission - Project Kangaroo Final Report.

ClownShoes

February 4, 2009, 6:01 pm

Honestly, this decision has made me really annoyed. Rather then getting all the content we want with single sign-in, a single set of payment details backed by three large corporations with a service that was ready to go live we have to wait for a selection of diverse sites offering diverse content, probably costing more than the cost from Kangaroo because of the additional cost / profit centre between us and the content provider.





Thanks CC. It's as bad as the European CC decision on Premiership Football; make the consumer have to pay Sky AND Setanta for something we only had to pay for once. Way to go and protect the consumer.





Grrr.

DEB

February 4, 2009, 6:02 pm

Does seem since we have no Amazon VOD, no Hulu. Perhaps the subscription TV goliath Sky had something to say about it.


*Chuckles at mental picture of rampaging kangaroo*

Andy 10

February 4, 2009, 6:36 pm

This is the right decision. I work for a small start-up developing a similar service and this venture would have made all our efforts worthless. I am sure that there are other companies working on similar ideas as well. Why should British government backed organisations be allowed to get an effective a monopoly?

mr dog

February 4, 2009, 6:38 pm

I can only agree with what ClownShoes has already said; having three versions of the same software is a really stupid way of going about this. And what effect will this decision have on third parties? The way Kangaroo was designed i envisioned it being easily integrated into set-top-boxes and such, giving us a real British alternative to the likes of Apple TV and Amazon unbox (if they ever make it to the UK in any worthwhile form) if the beeb, ITV and channel four now all go their separate ways with separate closed systems, the only way we'll be able to get everything at a glance is to sit in front of our PCs with three VOD programmes running concurrently.

Hugo

February 4, 2009, 6:57 pm

Andy, is your start-up going to be sourcing content from the BBC, ITV and Channel 4? Are you going to be (potentially) offering those broadcasters' entire back catalogues of programmes? Are you going to sell to your customers at the same rates you pay for the content in the first place?





Because if not then your offering simply isn't/won't be as compelling as Kangaroo would have been. And that being the case the competition isn't coming from Kangaroo having a monopoly, it's coming from Kangaroo having a better product to sell.





As it is, you're now likely to have to have three competitors not one. You call that the right decision..?

ClownShoes

February 4, 2009, 6:58 pm

I'm sorry Andy. I understand how this would affect your business, but I fail to see how it benefits the consumer. As far as I'm aware the broadcasters had agreed to make the content available to third parties such as your self as well, or this should have been a condition of allowing Kangaroo to go ahead. This would have allowed you to compete with Kangaroo on price and quality of service. If you can't do that then how does this decision benefit the consumer?





These companies have invested two years of development and &#16325m on this project only to have it canned when it was ready to be released. If anyone else was capable of providing the service then they would have already.

needlegun

February 4, 2009, 9:03 pm

I also agree with the article. Consumers will have to pay more to multiple suppliers to get the same overall offering.

timple

February 4, 2009, 11:54 pm

This announcement is really awful. The CC is totally out to lunch. What planet are they on? Supermarkets? No problem. They don't have a monopoly on food sales in the UK and abuse small food providers... A single portal for video content from the UKs major program makers? Oh no - far too convenient and logical for the UK consumer. And of course sky would hate it since they wouldn't be in control.... The CC's problem is it seems completely on the side of big business at all times. The problem is it is probably stuffed full of over-paid economists living in a different world and hoping to get lucrative jobs with said big business following their stint with the CC. I just heard a very smooth self-certain self-satisfied CC man on radio 4 PM uttering drivel as to why they've stopped this and as you can see he really got me mad.





Well to be honest I'll stick to the iplayer. Since it came out I haven't been bothered with C4 or ITV on-line offerings (both were very clunky when they came out - and i haven't bothered to find out whether it's got any easier) and I don't give a **** for whatever sky offers. So the sooner the hard drive recorder people (Humax, Panasonic, Sony - are you doing anything?) start offering a native iplayer on their boxes (or the next revision of ps3 comes with playtv inbuilt) the faster we can have the BBC as the only VOD provider in town and I am not interested in any other offering either requiring subscription or bombarding you with adverts. It will end up the BBC player becomes kangaroo anyway once the other program makers realise that everyone goes to iplayer first and they want a slice of the viewers. No doubt the CC will then take iplayer off the BBC and we'll all end up watching fox tv uk inbetween celebrity big busts on ice has got talent.

PGrGr

February 5, 2009, 2:31 pm

Utterly ridiculous decision. Honestly, I haven't spoken to one person or read one opinion which is in favour of the CC on this one. I have been using iplayer for a while and have just tried 4od for the first time, and, timple, I can confirm that the iplayer is streets ahead in terms of ease of use, time taken to set up, and cross platform support.





(Just to go off on a rant for a moment, the 4od website even explains that the reason they can't offer the service for Mac OS is: This is an industry-wide issue caused because the accepted Digital Rights Management (DRM) system used to protect online video content, which is required by our content owners, is not compatible with Apple Mac hardware and software. The closed DRM system used by Apple is not currently available for licence by third parties and there is no other Mac-compatible DRM solution which meets the protection requirements of content owners.





This is patently nonsense as the BBC have clearly managed to get round the issue, and its also, clearly, untrue.





The real reason that 4od is pc only became obvious when I tried to install it on my 5 year old laptop, which only has version 9 of WMP installed. 4od require WMP 11 to be installed. They are tying their service to MS proprietary software, so it is hardly suprising that it doesn't work on anything but a Windows based system!)





Back to the point, does anyone know about the legality of the CC's decision. Could the backers of Kangaroo challenge the decision in the courts, if they wanted? If they have really committed &#16325m to the project already they are clearly serious about it, so is that an option?

timple

February 5, 2009, 5:52 pm

I've had a night to calm down and I am thinking that the UK does need a single portal for all program makers to be able to offer their programs either for free or if they think they can make some money for a subscription etc. Is not the body to do that someone like freeview? They have set technical standards for digital tv and the freeview+ - they are the logical people to setup freeview vod for the uk. They also seem to be most of the people behind kangaroo except BskyB (the main missing piece) and arqiva (who are an infrastructure provider not a program maker anyway) So if BskyB joined the party would the CC be happy or is freeview now going to get dismembered on the same wonky logic?





The Freeview Organisation (from their website)





Freeview is managed by DTV Services Ltd, a company owned and run by its five shareholders - BBC, BSkyB, Channel 4, ITV and Arqiva. Launched in October 2002, the Freeview service provides free-to-air digital TV channels, radio stations and interactive services through an aerial.

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