Last summer, media regulator Ofcom stated its belief that Sky”s dominance of the PayTV movie market should be broken by the UK”s Competition Commission. But by December, Sky had responded, arguing that the emergence of VOD players like Netflix and Amazon-owned LoveFilm had changed the market landscape.

Now, though, Ofcom has reiterated its position, arguing that the impact of the new on-demand players should not be “overestimated or overstated”. In a report published last week, it said: “We have not seen any clear evidence to demonstrate that subscription video on demand services offered by LoveFilm and Netflix exert a sufficient competitive constraint on Sky Movies.”

As a result, it continues to argue that Sky”s first subscription PayTV window deals with the six major Hollywood studios continue to pose a problem. “We do not see that the new services have already addressed the issues identified in the Competition Commission’;s provisional findings, or that, in the absence of intervention, they can be relied on to do so in future.”

Meanwhile, in a separate development, Ofcom is to launch an investigation into Sky News” hacking of emails belonging to John Darwin, the man accused of faking his own death. The regulator is investigating whether Sky News has broken rules regarding fairness and privacy.