Panic buying

Homechoice 'not for sale'

BSkyB is belatedly trying to catch up with the whole idea of video on demand via broadband services, which is the technology that's best placed to seriously disrupt BSkyB's monopoly of pay-TV by satellite in the UK and Ireland. Hence BSkyB's sudden interest in internet service providers such as Easynet, since broadband access has now become very popular.

BSkyB's problem is one that other monopolies like Microsoft have since discovered to their cost; namely that they can't claim ownership of the internet, so the only alternatives are to try and get people to use their software or alternatively provide exclusive content via an internet access service and hope that it's popular enough to dominate the market.

Unfortunately for BSkyB, Easynet may be a larger than average ISP but there are many other ISP's both large and small which all have the potential to offer exclusive content if deals can be struck with content providers. BSkyB already has various exclusive contracts with content providers but they predominantely relate to satellite distribution rights.

Another huge problem for BSkyB is that BT is still the dominant telephone/broadband infrastructure service provider in the UK, and BT plans to roll out a combination Freeview/broadband TV set top box by this time next year which is likely to represent a major threat to the BSkyB pay-TV monopoly in the longer term if BT can secure exclusive content deals.

At the end of the day content is king, and it would only take a handful of broadband content deals to make the difference. Combine this with disgruntlement regarding BSkyB's satellite TV monopoly and the scene is set for a major fight for dominance; a fight that represents a massive future risk for BSkyB.

No wonder BSkyB is panic buying.

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