Competition Commission Kills Project Kangaroo

The Competition Commission has finally laid Kangaroo, the promising joint venture between ITV, Channel 4 and BBC, to rest in a final report released today after having rejected possible alternatives to decrease any monopoly issues arising.

The commission said that the online VOD venture would be "too much of a threat to competition in this developing market and has to be stopped" adding that "UK viewers particularly value programmes produced and originally shown in the UK and do not regard other content as a good substitute".

One of the argument used by the Competition Commission to justify its decision is the fact that BBC, ITV and Channel 4 control (and own) the vast majority of the material; which obviously is quite ironic and contradictory.

As Cnet puts it, the trio is being penalised for producing unique content and having an archive; something that Sky, Virgin and Five do not have and which effectively put them at a disadvantage; but that's their fault, not Kangaroo's.

A statement issued jointly by BBC, ITV plc and Channel 4 said "We are disappointed by the decision to prohibit this joint venture. While this is an unwelcome finding for the shareholders, the real losers from this decision are British consumers. This is a disproportionate remedy and a missed opportunity in the further development of British broadcasting."

ITV's Chief Executive, Michael Grade, said that the company was surprised by the decision of the Competition commission but the commercial broadcaster is already focusing on expanding its ITV.com Video On Demand offer.

Others though, like Arash Amel, Senior Analyst at Screen Digest were convinced that Kangaroo was nothing more than a waste of time, effort and money as it was the "brainchild of a confused pre-"iplayer 2.0" era.

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Our Comments

Points to ponder: "With a fresh approach, policymakers could choose to prioritise a positive climate for commercial investment. Consumers could make an informed choice about products and services they wish to consume and pay for. The revenues could drive profitable returns and reinvestment in further high-quality content." Who said that? Jeremy Darroch, chief executive of British Sky Broadcasting in the Financial Times dated yesterday.

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Give the market a free hand in Digital Britain

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Kangaroo has lost its bounce: UK VoD suffers

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Tempus analysis: Bad show from the Competition Commission

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