Key facts
- Sky and ITV are proposing a £1.6bn merger of Sky's and ITV's broadcast and streaming businesses.
- The companies will argue their combined share of the total UK advertising market is approximately 20%.
- Regulators, including the Competition and Markets Authority (CMA), have begun reviewing the deal.
- The CMA is seeking public comment on whether the merger could harm competition.
- A key issue will be how the advertising market is defined: solely television or including digital platforms.
Sky and ITV are preparing to defend their proposed £1.6bn merger by arguing that the combined entity will control only about a fifth of the total UK advertising market. The companies are expected to present this argument to competition regulators, including the Competition and Markets Authority (CMA), which has initiated its review of the transaction.
The core of their defense will likely center on how the advertising market is defined. While a traditional definition focusing solely on television advertising would place their combined share at around 70%, Sky and ITV plan to argue for a broader assessment that includes streaming services, social media, and other digital platforms. In this wider market, their share is estimated to be approximately 20%.
The CMA has opened a public case page and is inviting comments from interested parties until August 6. A spokesperson for the CMA stated the importance of assessing the deal's impact on competition to ensure fair advertising terms for businesses and continued choice for viewers.
Analysts from Enders Analysis suggest that a key competition question for regulators will be whether to continue treating television advertising as a standalone market or to acknowledge the growing competition from digital giants like YouTube, Netflix, Amazon, and Meta. They view a broadcaster-only definition as "anachronistic" given the shift in advertising spending online.
Giao Pacey, a partner at Simkins, described the transaction as a significant development in the UK media sector, reflecting market realities rather than opportunistic consolidation. The central question, she noted, is whether regulators will permit the creation of a stronger UK media entity without compromising competition or consumer choice.
Sky agreed to acquire ITV's broadcast and streaming business earlier this month. The deal, which leaves ITV Studios as a separate production company, is anticipated to be completed in the second half of 2027, pending regulatory approval.