Sky and Virgin end their battle

So the spat between Virgin and BskyB is at an end.

Hostilities broke out over 18 months ago and it all got very silly when Virgin stopped carrying some of Sky channels.

The row began when Sky decided to charge Virgin twice as much as previously to carry its channels.It what came to be seen as a standoff between Richard Branson and Rupert Murdoch,Virgin retaliated by simply taking the Sky channels off its service.

Details of the settlement have remained confidential although as Paid content points out

But it's likely Sky will have had to accept less than it wanted first time around. The loss of Virgin's 3.5 million TV customers was never in the interest of Sky's advertisers - now the ad recession is biting, Sky needs to offer them as much reach as possible.

.

The FT reports that

Channels that Virgin developed to fill the gap will continue on its own platform, and will also be carried on the satellite broadcaster until June 2011, under the terms of the resolution.
Jeremy Darroch, chief executive of BSkyB, added: “This is great news for Sky and Virgin Media customers alike. We want our channels to be enjoyed by as many people as possible so we’re delighted to secure their return to the Virgin Media platform.”

A small price to pay for BSkyB

The decision by the government to force the broadcaster to sell its share in Itv from 17.5 % to below 7.5% may ,on reflection, not be a bad piece of business for the Murdoch clan.

Although it is estimated that if they sell at the present time they could lose up to £300m,that is waht is cost them to keep Virin Media at bay.In the long term it could be seen as a good bit of business.

Guardian media reports that

ITV said today that it "warmly welcomed" Hutton's decision, which was widely expected following the commission's ruling.
"We believe this decision is in the best interests of the overwhelming majority of our shareholders," the company said in a statement.
BSkyB said: "The company will give careful consideration to the announcement and confirm any further steps in due course.

On why anyone would want to buy Virgin Media

A good piece in the Times this morning by James Harding following yesterday's announcement that Virgin Media is being courted by the private equity sector.James makes the point that

"cable in Britain has always suffered by comparison
with networks elsewhere. In the United States and Germany, the cable systems
were laid a generation ago, well before they could be challenged by digital
satellite platforms or DSL-upgrades to copper wire telephone lines. Along the
way, nearly every cable operator has had to undergo a financial restructuring to
absorb the costs of developing a national network. "

As to why Carlyle would want to make a bid for sucha debt laden organisation,well.....it

"has an enviable combination of assets for a converging
world of entertainment and communication: it has all the elements of the
quadruple play – television, telecoms, broadband and mobile; it has distribution
over Freeview and over a pay-TV platform; it has a content business; and it has
a brand. Carlyle’s gamble is that private equity can put the business on a
stable financial footing and impose effective management, so that cable,
finally, fulfills its long-heralded potential. It is a bold bet."

Virgin Media to go private

We woke to the news this morning that Virgin Media is under attack from the private equity brigade.

This from Media Guardian,

"

"Private equity firm Carlyle Group has made a preliminary
offer for cable TV company Virgin Media, in a deal that could reach around $20bn
(£9.95bn), according to reports from the US overnight.
Carlyle is in the
early stages of talks with Virgin Media, the New York Times and Washington Post
reported today, quoting sources familiar with the negotiations."

Reports also state that Richard Branson seems quite happy for the group to go back into private ownership and wishes to retain a stake.The management feel that the company will have a greater growth potential in the private sector.

The Company currently has around 9million customers for its broadband,cable Tv and phone empire and is still embriled in a battle with Sky over the distribution of Tv Channels.