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Sky today made a cunningly-timed announcement 'fessing up to its new "Picnic" offering that will let non-satellite customers join its broadband network and terrestrial TV viewers receive its pay TV channels.

Subject to clearing regulatory hurdles, the new venture will launch in the new year as a separate business with its own management and customer services. It'll take on BT, TalkTalk, Virgin Media and the rest in markets that Sky had left unfought.

Punters will be able to pick and choose from up to 16Mbit/s broadband (available to the 70 per cent of homes covered by Sky's LLU network), fixed line phone, and a new range of terrestrial set-top boxes. Pricing details haven't been released.

Sky applied to Ofcom to change the three channels it offers over the air in February. It wants to add a fourth by switching Picnic's new generation of decoders to MPEG4.

Sky Movies, Sky Sports, and Sky One have been fingered for the initial line up. Sky currently uses its terrestrial bandwith for free broadcasts of Sky Three, Sky Sports News, and Sky News. The rolling news channel will return if Ofcom also rubberstamps the MPEG4 plan, and during the day a factual channel and a kids' station will run on two of the streams.

Regular Reg readers have known about Picnic since August. Given it won't launch for some months yet, the timing of the announcement is triply significant.

The first wave of households tempted by TalkTalk's game-changing "free" broadband offer will be released from their 18-month contracts from 11 October. The littany of delays and technical problems many have endured has contrasted with Sky's own smooth rollout of broadband for its TV customers.

It's also a good spoiler for O2's twice-delayed ADSL2+ launch, which the Mail on Sunday reckons will finally happen this week under the name "Fourplay".

On the TV side side of battle, news that terrestrial TV viewers can pay for access to some of the satellite broadcasters' premium channels steals thunder from Virgin Media's noise making over its new channel, Virgin 1. The cable firm created the channel after Sky withdrew Sky One in a fees dispute earlier this year, and begins broadcasting it on Freeview today.

Sky is accepting registrations for the launch of Picnic here. The start of Ofcom's 10 week consultation is imminent. ®

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