None of our business
In true public-sector style, the Office of Fair Trading (OFT) has had a good, long think about whether to investigate the proposed collaboration to create an open standard for IPTV - Project Canvas - before deciding not to do anything.
Project Canvas is a proposed joint venture between the BBC, ITV, Channel 4, Five, BT, Talk Talk and Arqiva to create an open standard for Internet TV. It has been approved by the BBC Trust and is going through a period of open consultation, in which objections to its formations can be made, before it can be launched.
Among the most vocal opponents, unsurprisingly, are the pay TV providers Sky and Virgin Media, who question how open the joint venture really is. The BBC Trust has said it will make a final decision on whether or not to give Canvas the green light this spring, which gives it another 11 days by our calculation.
The OFT was apparently thinking about investigating Canvas under the merger provisions of the 2002 Enterprise act, but has now realised that since none of the protagonists are contributing a pre-existing business, it's not a merger and hence not in its jurisdiction. Furthermore Canvas is different to Project Kangaroo - which was blocked by the Competition Commission - because the partners won't be contributing content or commercial efforts to the joint venture.
"Our investigation has confirmed that the JV partners, including the BBC, do not intend to transfer an existing business into the JV," said Sheldon Mills, OFT director of mergers. "Therefore, regardless of the potential significance of Project Canvas JV for the future of internet connected television, the notified proposals do not give rise to a merger qualifying for substantive investigation by the OFT."
This could well be a precursor to a final approval from the BBC trust, although it doesn't preclude other competition law obstacles being thrown in Project Canvas' path.
"The Project Canvas partners welcome the decision from the OFT, which confirms our analysis and sets the scene for the final stage of the regulatory process," said Project Canvas director Richard Halton. "Project Canvas aims to create an open platform that delivers a connected future for free-to-air TV and a competitive market for internet connected TV services in the UK. The Project Canvas partners are committed to achieving that aim."