Large numbers of Virgin Media customers have recently been upset by the withdrawal of 'basic' Sky television packages from its services. Channels such as Sky News and Sky One have disappeared from the Virgin (formerly ntl:Telewest) cable service since 1st of March following talks between the two companies which did not come to an agreement over the fees paid to Sky. The disagreements revolve around the fees for basic Sky channels and to a lesser degree Virgin's own channels such as Living and Bravo. Virgin have suggested binding arbitration by an independent expert but Sky have reportedly refused to enter into this.
Virgin have today announced its intention to take legal action against Sky unless the matter is not resolved within 30 days including a claim for damages. The company claims Sky has abused its dominant position. The popularity of Sky channels is well known, and Virgin has very limited options to replace this content which includes popular shows such as The Simpsons and 24 among others.
Since the removal of the channels, Virgin Media have been broadcasting messages in place of Sky channels encouraging viewers to visit virginmedia.com/fairplay and comment on the situation. This has resulted in several comments critical of Virgin appearing as well. TheRegister even reports that Virgin's programme guide has renamed 'Sky News' to 'Sky Snooze'. The battle between the two companies is certainly far from friendly.
Since Sky have expanded into broadband, the two companies are competing head-to-head on the triple-play (television, broadband and telephone bundle) market. Virgin has already criticised Sky for acquiring a sufficient ownership of ITV to prevent Virgin taking it over.