TVNZ wants a say on Sky proposal to buy Prime

TVNZ plans to make a submission to the Commerce Commission over Sky Television's $30 million offer to buy the Prime network.

The news drew a strong reaction from Sky yesterday.

"We find it quite ironic that TVNZ is making a submission on this issue considering several years ago they were New Zealand's largest broadcaster and at the same time the largest shareholder in Sky," said spokesman Tony O'Brien.

The state-owned broadcaster will not say if it is for or against the deal - but analysts say there is no doubt the submission will challenge Sky's agreement with Prime NZ's owner, Prime Australia.

"It's only sound commercial practice for an existing player to attempt to protect their turf," said Mediacom media strategist Michael Carney.

In a brief statement, TVNZ chief operating officer Rodney Parker said the submission would consider the implications for TVNZ of Sky entering the free-to-air broadcasting arena.

"We are carefully considering the implications of this move and reviewing the likely impacts on New Zealand's television landscape," he said, mirroring comments by rival CanWest MediaWorks on Friday.

Roger Beaumont, director of marketing and communications for MediaWorks, which owns TV3 and C4, said yesterday that his company was "considering its options in relation to the Commerce Commission".

Analysts said even if rivals successfully deflected Sky's bid for Prime through the commission, they were unlikely to be able to stop Sky pursuing a free-to-air strategy.

"Sky could launch its own free-to-air channel if the Commerce Commission turns it down," said David Lane, head of research at UBS New Zealand Equities. "It would be difficult to have an argument before the Commerce Commission about that when it would increase the number of free-to-air channels."