Discovery, Sky fees war looms

Discovery Communications has said negotiations with European satcaster Sky over a new carriage deal have reached an impasse, threatening to black out 12 Discovery channels on Sky’s platform.

Susanna Dinnage

The row erupted yesterday evening when the US factual giant threatened to take down its portfolio of channels, including Discovery, TLC and Eurosport, from Sky platforms, after claiming it was not receiving a “fair price” for its content.

All 12 Discovery channels will now disappear from Sky and its online streaming service Now TV after January 31 if the dispute is not resolved.

However, pay TV operator Sky has claimed that Discovery’s price expectations for its channels are “completely unrealistic” and the company said in a statement: “Discovery’s portfolio of channels includes many which are linear-only where viewing is falling.

“We have been overpaying Discovery for years and are not going to anymore,” added Sky.

But the dispute appears to be no closer to a resolution this morning, with a statement on Sky’s website reading: “From February 1, Discovery Communications’ portfolio of channels are unlikely to be available in Sky TV packages.”

Susanna Dinnage, MD of Discovery Networks UK, said the company was making a stand for consumer choice and independent broadcasters.

“We believe Sky is using what we consider to be its dominant market position to further its own commercial interest over those of viewers and independent broadcasters. The vitality of independent broadcasters like Discovery and plurality in TV is under threat,” she said.

“Pay television needs to be about more than just films and football. The consumer can’t be expected to fund all of Sky’s investments and get less and less choice in return.”

Dinnage added that she was concerned Sky’s “incentive to disadvantage independent TV content providers” would increase due to its pending takeover by 21st Century Fox in the US.

Discovery, which launched in the UK in 1989, claimed that it is paid less than it was by Sky a decade ago, despite increasing its share of viewing by 20%. It also claimed its channels account for half of all factual viewing on Sky.

Discovery Channel, TLC, ID, Eurosport, Discovery History, Animal Planet, Discovery Shed, Home and Health, DMax, Discovery Science and Discovery Turbo are all affected by the move.

A message will appear on all Discovery channels to inform Sky customers about the change from 20.00 on January 25. Discover said there are no changes on the BT and Virgin Media platforms, with which it has separate agreements in place.

While the dispute between Sky and Discovery is unprecedented, the media giants have been involved in separate rows over carriage fees. Discovery previously pulled its signals from Telia in Sweden and Telenor in Norway in a bid to increase its carriage fees.

Sky has been involved in a debate about retransmission fees in the UK for years, with broadcasters such as ITV calling for pay TV platforms to pay for transmission of their channels. Under the current UK regime, pay platforms make no payment to terrestrials.