Sky and Virgin confirm end to carriage dispute

LONDON - BSkyB has regained carriage for its basic-tier TV channels on Virgin Media, ending a 20-month dispute.

Ross Kemp fronting Sky's award-winning gangs series
Ross Kemp fronting Sky's award-winning gangs series

The negotiations have successfully concluded with Sky's basic channels - Sky1, Sky2, Sky 3, Sky News, Sky Sports News, Sky Arts 1, Sky Arts 2, Sky Real Lives and Sky Real Lives 2 - returning to Virgin Media's cable TV service on 13 November. The new carriage deal will run until 12 June, 2011.

As exclusively revealed in Media Week (30 September), Sky Media had been confident of a deal being reached when presenting to media agencies at the start of the trading season.

A second deal has also been agreed which provides for the continued carriage of Virgin Media TV's basic channels - Living, Living 2, Bravo, Bravo 2 Trouble, Challenge and Virgin 1 - as part of Sky's retailed channel line-up on satellite. This deal also runs until 12 June, 2011.

The original dispute occurred in March 2007, when Sky's basic channels came off the Virgin platform, due a dispute over the amount Virgin was prepared to pay Sky for its channels. Virgin Media took BSkyB to court, seeking a remedy.

Both Sky and Virgin Media have now agreed to terminate all High Court proceedings against each other relating to the carriage of their respective basic channels.

The absence of its basic-tier channels from the Virgin platform had dented Sky's revenues and also hit Virgin Media's pay-TV subscriber growth.

During the first three months of 2008, Sky's earnings from customers watching its channels on rival pay-TV platforms (wholesale subscription revenues) fell by £26m, compare to the same period in 2007, to £136m.

Virgin Media's chief executive, Neil Berkett, said the company was pleased to have finalised what "represents a fair deal" and "is the right thing for our customers".

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