The much vaunted internet tv on demand collaboration Project Kangaroo, proposed by UK TV networks BBC, Channel 4 and ITV has been stopped in its tracks today in a ruling by the Competition Commission.

The 2 year old project was dealt a blow back in December 2008 when it was decided that the service would “lessen competition”. The CC offered a series of remedies to the problem including the idea of forcing the partners to offer its TV content to rival companies. These solutions though have now been deemed as not enough.

Chairman of the commission, Peter Freeman said:- “After detailed and careful consideration, we have decided that this joint venture would be too much of a threat to competition in this developing market and has to be stopped. BBC Worldwide, ITV and Channel 4 together control the vast majority of this material, which puts them in a very strong position as wholesalers of TV content to restrict competition from other current and future providers of video-on-demand services to UK viewers. Without this venture, BBC Worldwide, ITV and Channel 4 would be close competitors of each other. We thought that viewers would benefit from better VOD services if the parties, possibly in conjunction with other new and or already established providers of VOD, competed with each other.”

One of the partners, ITV showed surprise at the ruling:- “We are surprised by this decision because we believed that the Kangaroo joint venture, competing in a crowded online world against dominant global brands, was an attractive UK consumer proposition, free at the point of use. However, in the two years since the idea for Kangaroo was born, the success of ITV.com has proved that our UK content is attractive enough to stand on its own and we remain focussed on our online growth.” said Michael Grade.

This ruling puts back internet TV in the UK as the proposed system would supply multi channel content from a single source. However this decision could lead to a another solution.

The networks are now free to pursue the avenue of sharing the BBC’s award winning triumphant catch up TV service – iPlayer. This has been proposed before by the director general of BBC. But it has been put on the back burner pending a decision on the Kangaroo project.

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