Project Kangaroo Blocked Due To 'Competition Threat'

The on-demand video service Project Kangaroo has been blocked by the Competition Commission, because it posed "too much of a threat to competition".

The commission said that the joint venture between the BBC, ITV and Channel 4 "has to be stopped" because it would place the three broadcasters in a "very strong position" to restrict competition from other providers of video on demand services to UK viewers.

Viewers would benefit from better VOD services, if the three broadcasters remained as "close competitors", rather than allies, the commission added.

Project Kangaroo would have seen more than 10,000 hours of programming from the BBC, ITV and Channel 4 become available in one place for viewers.

Each broadcaster currently offers viewers the chance to view shows for free through their individual on-demand services - the BBC via the iPlayer, ITV, via the website ITV.com and Channel 4 through the 4oD service.

A statement from the Competition Commission said: "After detailed and careful consideration, we have decided that this joint venture would be too much of a threat to competition in this developing market and has to be stopped.

"The case is essentially about the control of UK-originated TV content. BBC Worldwide, ITV and Channel 4 together control the vast majority of this material, which puts them in a very strong position as wholesalers of TV content to restrict competition from other current and future providers of VOD services to UK viewers.

"We thought the joint venture parties would have an interest in doing so, in order to make Project Kangaroo a success."

The three broadcasters issued a joint statement, stating that there were "disappointed" by the Competition Commission's decision. The statement said: "While this is an unwelcome finding for the shareholders, the real losers from this decision are British consumers.

"This is a disproportionate remedy and a missed opportunity in the further development of British broadcasting."

Michael Grade, Chairman and Chief Executive of ITV, said he was "surprised" by the decision, saying: "We believed that the Kangaroo joint venture, competing in a crowded online world against dominant global brands, was an attractive UK consumer proposition, free at the point of use."

(KMcA/JM)