Friday, July 31, 2009

One Horse Race

The sun is shining on Sky as they post glowing figures. It seems we're all staying in and watching HD TV.

Meanwhile, Channel4 has pulled out of bidding for the channels Virgin Media has put up for sale (what was a PBS channel doing bidding for commercial channels anyway ?), leaving BSkyB as the main contender.

UK TV has become a one horse race. Virgin Media is too weak and underpowered to compete whilst ITV is a basket case.

The reluctance of overseas companies to enter the UK market surprises me, but I suspect that there are a number of rational reasons:

- RTL has failed to make much impact with FIVE
- the BBC skews the market
- there is too much competition
- you have to deal with and compete with BSkyB

Murdoch's tentacles now reach far and wide and he can play off his movie studio against distribution deals around the world.

Frankly, the UK media market excites me, but only when it comes to Internet TV. The cost and barrier to entry are much lower. You can use Google for distribution and the online video advertising market is beginning to take off. This is what the overseas players have realised and why Hulu and other similar service are far more likely to represent their ambitions in the UK market than a full blown assault on the dinosaurs of traditional UK TV. And one of the ultimate owners of Hulu is....Sky's major shareholder, NewsCorp.