BSkyB chairman slams BBC over iPlayer

BSkyB chairman James Murdoch has attacked the BBC iPlayer service, accusing the BBC's governing body of an "abrogation of responsibility".

Murdoch's comments after delivering the Marketing Society annual lecture in London mark the latest stage in the ongoing battle between Sky and the BBC.

IPlayer represented a "big step", according to Murdoch, and a "pre-emptive intervention in a marketplace [which is] otherwise hugely competitive and moving very fast".

Murdoch reserved his criticisms for the manner in which the BBC is regulated and the way the service was brought to market, rather than the iPlayer itself.

"I am not saying it is a bad product, but it does crowd out competition and innovation. But we have it now, so there you are," he said. "It is less about the iPlayer and more the process that led to its birth."

The success of the iPlayer has even taken the BBC by surprise. The service handled 17.5 million requests for downloads in April, less than three months after its launch.

TV executives are concerned that the iPlayer will make further inroads into pay TV, as the BBC has pledged around £130m for investment in on-demand services over the next five years.

The BBC Trust countered Murdoch's criticisms, pointing out that the iPlayer had been subject to a rigorous Pubic Value Test which included a market impact assessment carried out by Ofcom.

"The Trust imposed a number of conditions on the iPlayer to take account of market impact issues, consultation responses from the industry, and responses from 10,000 licence fee payers before final approval was given," said a BBC Trust spokeswoman.

The BBC has also come under fire from ISPs since the launch of iPlayer, leading to calls for so-called traffic shaping where control is exerted over the number of users visiting a network at any one time.

Service providers have even suggested that the BBC should pay a congestion charge, citing Ofcom estimates that the cost of upgrading infrastructure to cope with increased traffic levels could amount to £830m by 2011.

The regulator has, however, ruled out public funds being allocated to network upgrades.