February 28, 2007

If you're a cable viewer, there is every chance that as from midnight tonight* you'll lose the opportunity to watch Sky One (Lost, The Simpsons), Sky Two and Three, Sky News and Sky Sports News.

This is because all the cable companies - merged suppliers NTL and Telewest and the "carriage provider" (the people who press the buttons to send the programmes down the cables to your house) - now all come under the umbrella of Virgin Media, owned, of course, by Sir Richard Branson.

In Branson, Sky owner Rupert Murdoch knows he has a genuine and deep-pocketed competitor, who is more popular in this country than Murdoch as an individual will ever be (though the same cannot be said for his market-leading products, it has to be said).

Today - tonight - sees the end of the current contract between the two and they are at loggerheads about signing a new one.

Basically, Murdoch wants Branson to pay him more for the privilege of carrying Sky One etc on the Virgin network.

While Branson says they're paying enough already and that Murdoch is trying to strongarm Virgin out of the market.

They've probably both got a point - but let's completely forget about that, as what we think won't change anything there, anyway.

While the billionaires squabble over who's going to rule the airwaves, I discovered last night that the devil really is in the detail.

Guess how much the cable network currently pays Murdoch - on your behalf, with the money you pay them - for a whole year for the Sky channels?

Bearing in mind you're paying around £30 a month for a package that includes movies or sports (like most people do)?

£300?

£150?

£50?

Oh no.

For each cable customer it has in the UK, Virgin pays Sky 90p a month - or £10.80 a year.

Yes.

£10.80 a year.

Which is pretty much what Sky - and the omnipotent "market" - reckon you, as a subscriber, are worth each year to either of them, Sky or Virgin.

Which means, if you take sports and movies along with everything else and so pay around £40 a month, for that £480 a year, just over a tenner of it is for the privilege of actually watching it.

Let's say, generously, that another £100 a year is for program "making" - at an absolute push, that is, because apart from sport most of satellite and cable programming is relatively cheap American imports.

The rest?

The other £370 year?

Straight into the shareholders' pockets, be they Sky or Virgin.

Bear that in mind the next time you want to pay extra for a "box office" movie or a Sky Sports "Premium Plus" football game.

* Not that we'll watching at midnight tonight, anyway. We'll be too busy at The Bloscars.