Ofcom review delays BSkyB digital launch

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LONDON -- British Sky Broadcasting's bid to launch a subscription-based digital terrestrial platform before the end of the year was dealt a blow Tuesday when U.K. media regulator Ofcom said it will not make a decision on the matter until early 2008.

The satcaster already had scaled down its plans to launch the three-channel service with MPEG4 compression technology in a bid to get its product in shops in time for the launch of the soccer season in August and the key pre-Christmas sales period.

But the regulator said that the launch of a public consultation into the proposal, put forward by the satcaster in February, will take the approval process into next year.

"Ofcom expects to issue a consultation document in the autumn, provided there are no further delays in the conclusion of outstanding technical and commercial issues between the applicants. Ofcom's normal consultation period is 10 weeks. This will be followed by a statement, which Ofcom would hope to publish early next year," the regulator said Tuesday.

"In the meantime, digital terrestrial broadcast network operator National Grid Wireless is obliged to ensure that Sky's free-to-air channels remain on the DTT platform pending the outcome of Ofcom's review," it added.

Sky is seeking to replace its three existing free-to-air channels with its pay offerings Sky One, Sky Sports and Sky Movies. MPEG-4 compression technology would have allowed it to have squeezed an extra channel onto the proposed Sky-branded platform.

Sky said in a statement that the delay to the approval process was "regrettable" and that its proposal was aimed at injecting "more competition" into the DTT platform. Sky insisted that it will continue to cooperate fully with the regulator but said its insistence on MPEG-2 technology was misguided.

"The adoption of MPEG4 technology is an inevitable step forward for DTT, bringing increased choice for viewers by making more efficient use of scarce capacity. We remain committed to introducing MPEG4 at the earliest opportunity and all set-top boxes for our new service will be capable of receiving both MPEG4 and MPEG2 transmissions," the satcaster said.

"While is it regrettable that Ofcom feels unable to begin its consultation before the autumn, we'll continue to engage fully with the review and work towards launching the service as soon as possible."
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