Sky has published its second submission to the BBC Trust consultation on the proposed project Canvas joint venture platform. It raised a range of significant concerns with the proposals and the process by which they are being considered. Sky said the plans to create a new platform go beyond the remit of the BBC. It is a challenge that the governing body will find difficult to ignore.

The pay-television provider noted the “apparent intention to develop, launch and operate an entirely new content distribution platform together with a limited number of competitor venture partners, for mutual benefit, to the exclusion of other industry partners”. It said this goes “far beyond the BBC’s remit”. The particular circumstances relating to the creation of Freeview and the development of Freesat should not “be used as a precedent to justify further intervention in content delivery platforms”.

The BBC Trust, Sky submitted, should consider whether there is robust and compelling evidence of unsatisfied consumer demand, given that numerous network connected televisions, set-top boxes and games consoles are emerging. To the extent that standardisation is required, it said, this is taking place through the Digital Television Group in the United Kingdom and through global technology manufacturers.

Sky asked the Trust to consider whether the proposals for Project Canvas are consistent with the primary purpose and obligations of the BBC and whether they are an appropriate use of the television licence fee. Only then, it suggested, should it grant approval, subject to conditions.

Sky advocated that the BBC could discharge its public purposes and obligations more efficiently and proportionately through a genuinely broad policy of syndicating programming across third-party platforms and services.

Irrespective of whether it is appropriate for the BBC to be engaged in platform development and commercialisation, Sky said a joint venture is not necessary and there is no justification for restricting partners to public service broadcasters to the exclusion of others. In the event that a joint venture were to be retained, Sky said it should be open to all.

Sky said the stated intention to control the user interface represents an “unnecessary and disproportionate” intervention, necessarily reducing innovation and competition between manufacturers and service providers. It noted that Freeview has been a success despite not having a uniform user interface.

For a set of proposals positioned as “a standards based open environment for internet connected TV platforms,” Sky said it is remarkable that the technical standards remain unspecified and that the means by which they will be developed remain unsettled, including any proposals for conditional access and digital rights management. Sky recommended that the BBC should be required to work with the DTG industry body, which must own the processor for developing the specification, rather than be handed a fait accompli.

Sky has previously complained that the BBC has restricted distribution of its on-demand programming exclusively to iPlayer branded services. Sky called for such programming to be made available across a broad range of services. It suggested the BBC should be required to make available its programming in open standard format to enable it to be incorporated in third-party services, subject to necessary constraints on copyright and branding.

The Sky submission went on to raise issues relating to state aid, in relation to the costs associated with developing the proposals from which the joint venture partners may benefit, and with regard to merger issues that might result from any transfer of existing Freeview and Freesat operations and assets into the joint venture.

Sky described the consultation process as “flawed,” the information provided as “inadequate” and said the failure to appoint the communications regulator Ofcom to conduct a full market impact assessment undermined the perceived and actual independence and robustness of the assessment. It called on the Trust “not to repeat these procedural errors” in considering its conclusions, saying the further consultation period of four weeks is “wholly inadequate, particularly if further information such as the technical specifications emerges, as indeed it should”.

It will be difficult for the Trust to ignore the serious objections raised by Sky in its submission. If it were to approve the proposed joint venture, the BBC faces the prospect of regulatory challenge and the competence of the Trust as a governing body being questioned.

One solution would be for the Trust to insist that the BBC works with industry groups such as the DTG to establish genuinely open interoperable standards, consistent with other countries, avoiding the need for a joint venture vehicle which seems laden with potential problems.