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Last Updated: Thursday, 1 March 2007, 18:03 GMT
BSkyB channels taken off Virgin
Sir Richard Branson, Virgin Media's single biggest shareholder
Virgin Media has accused BSkyB of "bullying" and "arrogance"
Virgin Media customers have lost access to some BSkyB channels after the deadline passed for the two companies to resolve a row over TV rights.

The broadcasters had until midnight on Wednesday to reach a deal which would have allowed cable company Virgin Media to continue showing basic Sky channels.

Virgin Media has accused BSkyB of raising its prices too much, but BSkyB has said the higher fees are justified.

Talks between the two broadcasters broke down last week.


Virgin Media said it had made "continued efforts" to strike a deal with Sky but that its rival broadcaster had rejected an offer of independent arbitration.

"We're disappointed but not surprised by this outcome," said Virgin Media chief executive Steve Burch.

"Nothing Sky have said or done in the course of the negotiation indicates they had the slightest interest in doing a commercially viable deal."

A spokesman for BSkyB said: "We're disappointed that we will now be denied access to cable TV homes.

"We've made repeated efforts to reach an agreement but Virgin Media has rejected all of our proposals - including our latest offer."

I thought this squabble between two billionaires wouldn't affect me, but how wrong I was
Ben Anderson, Cambridge

Virgin Media customer John Gullidge told BBC Radio Five Live how he felt when his screen went blank.

"It's disgusting, I'm really angry about the whole situation. I signed up with NTL for the package, largely based on Sky One because I'm a big fan of all the American shows they have and I've just been abroad for a week," he said.

"I've just got back to find I've got no more Sky One."

War of words

Virgin Media - which was formed from the merger of cable TV firm NTL and Virgin Mobile - accused BSkyB of "bullying" and "arrogance".

Virgin Media had warned it would drop the Sky Basics TV package, which also includes Sky News, Sky Travel and Sky Sports News, if agreement on a new contract to replace its current one could not be reached.

Sky One includes popular series such as 24 and Lost, as well as new episodes of The Simpsons.

The latest war of words between the two firms came as Virgin Media revealed that 37,000 customers had left the company during the final three months of 2006, before the firm's rebranding.

However, Virgin Media said revenues had remained ahead of expectations at 1.08bn ($2.1bn), from 916.1m a year ago on a pro-forma basis.

On Monday, the government ordered media regulator Ofcom to investigate BSkyB's controversial purchase of a 17.9% stake in ITV.

BSkyB's decision to buy into ITV was seen by some as an attempt to block a bid for the firm from its then rival NTL.

The government said it had asked the watchdog to advise on whether November's share deal was against the public interest.

Terrestrial 'top-up'

In another development, BSkyB has given further details of its previously-announced plan to launch a subscription service on digital terrestrial TV.

The firm said last month it would drop Sky Three, Sky News and Sky Sports News from Freeview and use their capacity to run a pay-TV service instead.

BSkyB now says it plans to offer programmes from its Sky One channel via standard TV aerials from this summer.

The broadcaster has applied to media regulator Ofcom to be allowed to offer four subscription channels, which could be accessed with a Freeview box.

It has still to decide whether to offer the Sky One channel in its entirety or just a selection of its programmes.

The move opens up the possibility that new series of Lost, 24 and the Simpsons will soon be available on digital satellite and digital terrestrial TV, but not via Virgin's cable service.

Switched-off at midnight, Virgin viewers lose Sky

Ofcom to probe BSkyB stake in ITV
26 Feb 07 |  Business
Q&A: Sky and Virgin Media TV row
23 Feb 07 |  Business
Virgin slams BSkyB in TV dispute
23 Feb 07 |  Business
NTL renames itself Virgin Media
08 Feb 07 |  Business
Broadband costs dent BSkyB profit
31 Jan 07 |  Business
OFT starts formal BSkyB-ITV probe
12 Jan 07 |  Business

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