Ofcom gives BBC greenlight in UKTV split up
Details
Joseph O'Halloran
| 05 June 2019

The UK’s broadcast regulator Ofcom has revealed that it has decided not to conduct a formal competition assessment of the BBC’s regarding the deal between its commercial arm, BBC Studios, and Discovery regarding the break-up of UKTV.

Less than two years after Discovery acquired the half share in the British TV service to match that of BBC Studios, the two companies announced on 2 April 2019 that UKTV’s current format was to be broken up among its partners.

Under the terms of a 10-year content partnership deal — effective in all territories outside the UK, Ireland and Greater China —Discovery will take full ownership of UKTV’s lifestyle channels and BBC Studios will gain UKTV’s entertainment channels. That will see Discovery will take control of channels such as Good Food, Home and Really. For its part, BBC Studios will acquire the remaining seven channels — Alibi, Drama, Eden, Gold, Yesterday, W and the core entertainment channel Dave — along with digital player UKTV Play, and the UKTV brand.

As per its obligations under its Charter and Agreement, the BBC assessed the UKTV deal and concluded that it did not constitute a ‘material change’ to its commercial activities. For its part, Ofcom is obliged to ensure that the BBC’s commercial subsidiaries do not gain an unfair advantage over other rival services because of their relationship with the Public Service.

In the case of the UKTV deal, even though Ofcom considered that the deal would cause a significant change to the BBC’s commercial activities given the scale of the transaction, it decided not to conduct a further formal competition assessment of the UKTV deal.


Ofcom examined potential competition issues, including if  Public Service  content  was  supplied directly to UKTV below market rates, and the risk of  UKTV profits being used to  subsidise other commercial activities that are not earning a commercial rate of return over an appropriate period. However, it said it was confident  that  its trading and separation regulation sufficiently  safeguarded  against  any potential  market distortion  or unfair competitive  advantage  arising.

Ofcom added in its ruling though that it had We have also considered how it would hold the BBC to account on the commissioning requirements in the Agreement. It noted that it had decided not to impose any additional requirements on the BBC in this area at this time but would continue to monitor how the BBC’s commissioning process operates.