BBC, ITV, Channel 4 Agree to Five-Year Ban on Project Kangaroo-Type VOD Ventures

--Orange Decides against Purchasing Project Kangaroo's Technology Infrastructure

The Competition Commission--an independent public body which investigates mergers, markets and regulated industries at the UK government's behest, and which in February nixed Project Kangaroo, a joint video-on-demand venture between the BBC's BBC Worldwide arm, ITV and Channel 4, on the grounds that it would result in a "substantial lessening of competition in the supply of UK TV VOD content at the wholesale and retail levels"--published Friday drafts of "undertakings" that each of the Kangaroo partners must commit to in order to ensure that they do not engage (at least anytime soon) in joint activities that could restrict competition in the UK VOD market. The undertakings, whose terms have been agreed to by the Kangaroo partners, are now subject to public review and may be revised based on feedback: the Competition Commission is inviting interested parties to submit "written representations" on them by June 8th.

The draft undertakings agreements--which are slated to be in effect for five years--prohibit each of the parties (unless it secures "the prior written consent" of the Office of Fair Trading, the regulatory body at whose behest the Competition Commission launched its investigation of Project Kangaroo) from 1) acquiring control of "all or any part of the video-on-demand activities carried on" by either of the other two parties; 2) having any of its directors or managers hold "any directorship or managerial position in any company or other undertaking carrying on or having control of all or any part of the VOD activities" of the other two parties; and 3) carrying out "any agreement or arrangement with any person" that would allow it to circumvent these prohibitions.

In related news, France Telecom-owned mobile and broadband service provider, Orange, has decided against acquiring Project Kangaroo's technological infrastructure, in which the BBC and its partners are said to have invested £20 million. "We can confirm that we are not pursuing our interest in the catch-up TV service, Kangaroo," the company said in a prepared statement. "After in-depth due diligence, we concluded that it was unlikely that an outcome which benefited France Telecom's Orange operations would be met."

UK/Ireland