Bskyb has warned the telecoms regulator that its customers would be "adversely affected" by interference if deflector companies are allowed to provide digital television services.
Correspondence between Sky and the regulator's office, seen by The Irish Times, urges the regulator, Ms Etain Doyle, to avoid the risk of licensing regional or local digital TV services.
Sky warns that licensing local services would result in "serious adverse effects on existing and future digital telecoms services as a consequence of interference".
The paper says: "Sky's strong view is that it would be inappropriate to license the 12GHz band for local or regional DTT digital terrestrial TV services." The 12GHz band is the same one Sky uses to deliver its satellite signals to its customers. If other firms are allowed to use this band, the company claims it could lead to interference and loss of service for customers.
Sky is currently boosting its Irish presence with the appointment of a new director, by concluding a recent deal with RT╔ and by increasing its subscriber base to 193,000.
However, Sky is not regulated by the regulator here and industry sources said this might result in Ms Doyle's office taking less heed of their demands.
Yesterday, the telecoms regulator announced she would consider issuing local deflector firms with licences to supply digital television services on the same frequency band as BSkyB. This followed requests from a number of local deflector firms for licences to offer digital services to customers in their local areas or regions.
The regulator's decision was made despite the lobbying from Sky - part of which was prepared by one of BSkyB's top regulatory affairs executives, Mr Michael Rhodes.
Mr Seamus O'Leary, consultant with Mason Communications, said Sky's technical concerns were that signals sent by local terrestrial firms could overload their satellite. But he said the concerns were probably a mix of competition and technical issues. The licensing of local operators would mean more competition for Sky in the Republic.
However, a decision to license local operators may also undermine the business case for the proposed national digital terrestrial service, which is already facing pressure from BSkyB.
It is believed just one bidder emerged in a Government-backed competition to award a licence to enable a firm to run and market a national terrestrial digital service.
The competition is still ongoing and a decision is not expected until late January. But the rapid increase in Irish subscribers to Sky, combined with the high cable subscription price, has increased doubts about the proposed service.
Ms Doyle said yesterday she would offer licences only if they did not constrain the spectrum needed for the development of a national digital terrestrial service.
But a decision by Ms Doyle to license local and regional operators would add to competition in the market-place and make it more difficult for a winning bidder to make a viable business plan.
Although most of the local deflector firms are small firms supplying a service to as little as 100 households, others may potentially undermine a national service.
One of the parties which plans to express interest in the local digital TV licences is Southcoast Community TV, based in Co Cork. Its business plan for digital TV includes a proposal to offer the service to 100,000 households.
Ms Doyle will shortly invite interested firms to supply more details of their interest in establishing a local digital TV service.
