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Project Kangaroo gets more time to defend anti-trust claims

Probe into commercial iPlayer delayed

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The Competition Commission said today that its anti-trust investigation into Project Kangaroo, the joint internet TV venture by BBC Worldwide, ITV and Channel 4, will take longer than expected.

The trio of broadcasters has asked for more time to negotiate how they plan to operate the commercial video on demand operation. Regulators have extended the deadline for their evidence from the end of July until 8 September.

The Competition Commission also today released its issues statement on the plans, setting out the criteria it will use to test whether it will result in a "significant loss of competition". These include judgments on whether the three broadcasters involved are likely to offer their shows at wholesale to other video-on-demand operators under unfavourable terms compared to Project Kangaroo.

Watchdogs will also examine whether the joint venture, which is planned to offer both free-to-view ad-supported content and paid-for downloads, is likely to grant Project Kangaroo the power to raise consumer prices or stymie innovation.

Their decision could have wide-ranging implications for how UK anti-trust regulations are applied online. The investigation will consider whether the market Project Kangaroo competes in will be web display advertising, video-on-demand advertising or the TV industry.

The case was escalated to the Competition Commission by the Office of Fair Trading at the end of June. It received submissions from Sky, Virgin Media and others raising concerns that they could be frozen out of the nascent market for professional, commercial internet TV.

At the time, ITV chairman Michael Grade decried the investigation, pointing out that regulators have allowed US corporations Google and Apple to assume near-monopolies over other internet media. The BBC commercial arm, ITV and Channel 4 should be allowed to profit online from their investment in TV creativity, he argued.

The provisional finding of the investigation are now due in November, with a full report scheduled for mid-January next year. Project Kangaroo is unlikely to surface until well into 2009. ®

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