Messy negotiations over a new carriage deal between UKTV and Virgin Media have spilled out into the open as the dispute nears a rapidly approaching deadline and may result in UKTV’s 10 channels going dark on the platform.
The nature of the dispute is not exactly clear, with both sides citing different reasons for a breakdown in talks. Virgin Media has made the case that a key sticking point for them is VOD rights to BBC shows that air on a repeat window on UKTV’s channels.
It should be noted that Virgin Media has laid the blame for this dispute not on UKTV themselves, but the company’s joint owner BBC Studios for not granting a VOD licence. Virgin Media has reached out to BBC Studios in hopes of striking a deal that would bring at least some of the content to their customers as Box Sets. Thus far those attempts have been unsuccessful.
“Virgin Media has had a long relationship with UKTV, but viewing behaviours amongst our customers are changing and we are committed to investing in the kind of programming they want to watch, whenever and however they want to watch it. Unfortunately, due to the restrictions put on UKTV by the BBC, UKTV is not able to provide the significant on-demand programming that we know our customers want”, said David Bouchier, Chief Digital Entertainment Officer at Virgin Media, “We are still in discussions with UKTV but we have already invested in an extensive collection of replacement high-quality programming for our customers to enjoy.”
UKTV, however, says that they are unable to come to terms as Virgin Media is demanding a “significant cut” in fees, despite the fact that they account for more than 25% of viewing to pay entertainment channels in Virgin’s basic pay pack. (Virgin has claimed that while UKTV’s FTA channels perform well, the pay channels audience share has dropped.) “We want to continue to provide our channels to Virgin Media, but the huge cut in fees that Virgin has requested doesn’t reflect the value we bring to customers”, said UKTV CEO Darren Childs. “The money we receive from platforms helps to pay for our record investment in high-quality programmes, which we increased to more than £150 million in the last year. If our 10 channels, including Dave, W, Gold and Alibi, are no longer available through Virgin, we will be hugely disappointed for the millions of customers who will lose out. We’ll keep working with other platforms to bring viewers the drama, comedy and documentaries they love.”
UKTV has offered Virgin Media an increased range of on demand catch-up and boxsets, enhanced distribution rights, and an additional channel, Gold HD, to secure a new deal. The present agreement between the two companies expires on Saturday July 21st, when UKTV’s ten channels – including Dave, Gold, Alibi and Drama – will go dark. Assuming a last-minute agreement is not hammered out, Virgin will replace UKTV’s channels with such channels as Paramount Network and Your TV.