BBC challenges Sky's dominance

The cable industry is threatening to drop Sky News, which is provided by BSkyB, in favour of the BBC's forthcoming 24-hour news service.

Several cable companies, including Telewest Communications, NTL and General Cable, are understood to have held discussions with the BBC about offering subscribers the Corporation's news service in place of Sky News.

Although no agreements have yet been signed, cable companies have long been keen to break Sky's stranglehold on the pay-TV market.

The BBC's 24-hour news service, which launches in the autumn, forms part of its plans to enter the digital age. The BBC has separately signed a joint venture with Flextech, the cable and satellite programmer, which will see the creation of eight pay-TV channels, three of which will be broadcast by Christmas.

The arrival of the BBC's news service will challenge Sky News' claim to be "Europe's first 24-hour dedicated television news channel". Sky News has been on air since 1989.

The move will be seen in the industry as part of a protest against Rupert Murdoch's satellite broadcaster by the cable industry. Cable companies have already clashed this weekend over Sky's attempts to charge more for its sports channels. Sky Sports 2 was previously offered as a free "bonus" to subscribers and cable operators who take the two other sports channels. However, Sky announced recently that Sports 2 would become a premium channel from next month. Customers have to pay an extra pounds 3 each month for premium channels, Sky said.