Local private telecom operators have been told to stop offering unlicensed Sky channels as part of their product bundles, in a development that yesterday stunned viewers across the Rock and raised questions about tough competition in the sector.
For over 25 years, residents in Gibraltar have enjoyed a large number of TV channels at very low cost compared to other countries around the world.
But those channels, while delivered by local companies in full accordance with Gibraltar law, contained content that was not licensed for viewing in Gibraltar.
Yesterday, Sky became the first big broadcaster to order local providers to pull its channels from their bundles.
Sky’s decision had been on the cards for months but consumers learnt of the development just hours before the first local company took action.
U-mee cut 24 Sky channels from its offering late yesterday afternoon, while other companies including Gibsat and GibFibreSpeed are expected to follow suit in the coming days.
The only company that will continue to offer Sky channels is Gibtelecom, whose Sofi product includes Sky Sports Premier League, Sky Sports F1 and Sky News.
Government-owned Gibtelecom said it had purchased the rights to broadcast those three channels legally in Gibraltar.
But other providers which offered many more Sky channels will have to stop making them available to viewers.
At the core of the latest developments are Gibraltar’s small size and the intense rivalry between companies.
The small number of viewers here means broadcasters have historically turned a blind eye to the fact that unlicensed content was being transmitted to television screens around the Rock.
Local companies had in the past sought to engage with broadcasters including Sky in order to regularise their offering.
But the complex nature of rules governing content rights and distribution meant this was not deemed economically viable, leaving only a very limited number of channels that could be provided on a licensed basis.
Yesterday, No.6 Convent Place confirmed that Chief Minister Fabian Picardo is due to meet the chief executive of Sky in the coming days in a bid to find a way to continue to have Gibraltar included within the broadcaster’s coverage.
But the latest developments prompted deep unease among operators in the Gibraltar telecoms sector which, despite its limited scale, is fiercely competitive.
Sky’s decision to crack down now on the unlicensed delivery of its channels coincided with Gibtelecom’s entry into the market with licensed channels, leading other operators to speculate that the two factors were perhaps “more than a coincidence”.
Gibsat confirmed it had been asked to prevent access to Sky channels that the broadcaster said could not be licensed for distribution here. It said efforts over years to obtain the necessary rights had proved fruitless.
“No action has previously been taken against Gibsat and the present situation appears to have been prompted as part of the ongoing competition battle between telecoms operators in Gibraltar,” the company said in a statement emailed to this newspaper.
“In a recent court case in Gibraltar the Judge highlighted the need to encourage further competition in Gibraltar on the part of the dominant players in the market.”
“Questions remain as to whether this issue is a reaction to the success of GibFibre in providing that competition.”
Gibsat said it was presently negotiating so as to engage with Sky over an orderly withdrawal of Sky from the market, adding that advances in technology would simply mean that the public may need to get this programming in different ways in the future.
Rival operator u-mee, a brand belonging to Sapphire Networks, also faced a similar situation and yesterday pulled its Sky channels – 24 in total – from its bundled offering.
“Since the introduction of a ‘fully licenced’ entertainment product early in 2018, broadcasters and content owners have been encouraged to pursue the closing down of various popular channels in Gibraltar from providers including u-mee, GibFibreSpeed and Gibsat,” u-mee said in a statement.
“This includes most Sky channels available.”
“Although representatives from u-mee have been corresponding with Sky for the past nine months for an arrangement for Gibraltar, we have been forced to agree to withdraw Sky channels from our fibre TV and Internet TV products with effect from Tuesday 8th January.”
The company said it regretted the inevitable inconvenience that this development would cause its customers as well as the wider community.
“However, this is not due to any action we have taken and we very much regret the consequences,” it added.
Carsten Kjeldsen, a director of Sapphire Networks, told the Chronicle it had tried to reach an arrangement with Sky but accepted the broadcaster’s final decision.
He shared too the view that recent technological developments meant the future lay in streaming services including Netflix, Amazon Prime Video, Apple TV, as well as other streaming and download services.
He said u-mee, whose main focus is on delivering internet services, expected the move towards individual subscriptions for premium content to continue unabated, adding that such services would benefit from the type of high-bandwidth, reliable fibre broadband service offered by the company.
But he acknowledged that the immediate outcome for most viewers across the Rock would be the loss of some of their favourite channels.
“The net effect seems to be that viewers in Gibraltar will have fewer channels available to them,” he said.
The Chronicle was unable to reach anyone at GibFibreSpeed for comment despite repeated requests.