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New Ofcom warns on Canvas competition - 26-April-2009, 13:40

Ofcom warns on Canvas competition

By James Welsh

Ofcom has warned that Project Canvas, the on demand IPTV standard being developed by the BBC, BT and ITV, could face competition concerns of a similar kind to those that resulted in Project Kangaroo, a commercial video on demand project from BBC Worldwide, ITV and Channel 4, being blocked in February.

Canvas, which aims to bring the functionality of catch-up services such as iPlayer and ITV Player to broadband-connected set top boxes, will not face a full public value test as the BBC Trust has determined it is an extension of the existing service licence for Freesat.

Peter Phillips, partner for strategy and market developments at Ofcom, said in a letter to the BBC Trust: "We understand that issues relating to the compliance of Canvas with all relevant competition obligations will be considered within the trust's assessment, including those arising from arrangements specific to the BBC and also those arising as a result of competition, merger and state aid law... In that regard we recognise that there may be a future role for the OFT and/or Ofcom to assess the arrangement under relevant merger or competition law."

Canvas has taken pains from the outset to distance itself from Kangaroo, placing heavy emphasis on the intended open nature of the platform being developed.

Ofcom said that care needed to be taken that five factors are addressed from an openness and fairness perspective: technical standards; the establishment of partnership arrangements with other content providers; the availability of Canvas to TV platforms other than Freesat and Freeview; navigation through the on demand EPG; and that the standards by which programmes are included in the service are "justifiable, non-discriminatory, transparent and appropriate".

"While the benefits of Canvas are potentially significant we would encourage the BBC to continue to ensure its content is made available on a wide range of platforms," the regulator said. "In other words, it is important that comercially-led propositions which seek to compete with Canvas should not be unfairly prevented from accessing BBC content."
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