Pay-TV broadcasters such as BSkyB and Virgin Media could find themselves having to pay retransmission fees to public service broadcasters.
In a presentation at the RTS Conference, Sajid Javid, the secretary of state, Department for Culture, Media & Sport, said that the current rules allowing cable operators to retransmit public service channels free of charge were set in a different age and justified at the time, when the cable industry was just starting out.
Now, however, they are out of date. He added that it is important to start a proper consultation process now, though it should not be rushed and would not be part of a deregulation bill.
Such a consultation would also look at the EPG prominence public service broadcasters enjoy on pay-TV service.
Javid said that any changes would clearly have implications and that this is a “complex area” and a “high stakes game”.
What he currently sees now is a highly regulated market and “our role as the government is to ensure that viewers are the winners”.
In a response to Javid’s speech, Tom Mockridge, Virgin Media’s CEO, said: “UK public service broadcasters enjoy a unique role in the broadcasting ecology. We’re pleased Government has confirmed its review of retransmission fees will encompass other wider benefits the PSBs enjoy, such as EPG prominence.
“Virgin Media fully supports the ‘zero net fees’ ambition the Government reinforced today. We do not, nor have we ever, charged public service broadcasters. Equally, we do not believe viewers should pay an additional tax for the privilege of viewing programming which they have already paid for.
“Government is right to ignore the overly simplistic calls for another tax on TV viewers and review the current system in more detail. There is a careful balance to strike.”
On Monday, ITV published a report claiming ITV and the BBC were providing a multi-million pound subsidy to Sky and Virgin.
In March, the BBC and BSkyB reached agreement on the amount paid by the BBC for the cost of Sky’s platform services in a move expected to save the corporation some £4.5 million.
As part of a new deal Sky has waived the cost of running services such as the inclusion of the correct regional programme in its programme guide. The long-term distribution of both BBC channels and the BBC iPlayer has also been confirmed.
In other parts of his speech, Javid said that a review into the decriminalisation of licence fee evasion would begin now and report after next year’s General Election.