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As Babestation isn't an Ofcom licensee is it just the phonepayplus rules that stop them from going further than they do?

What are you talking about?

Babestation has a licence to broadcast from Ofcom.

What makes you think otherwise?

Do you know this for a fact?
Take a look at the current list of cable and satellite Licences http://www.ofcom.org.uk/static/tvlicensing/cs/main.htm

Babestation originally broadcast on an Italian gaming channel which wasn't licenced with Ofcom. When some of the uk gamers objected to Ofcom about the porn on 'their channel' Ofcom said there was nothing they could do about it.

It's only when they went a bit to far with the private babe stuff that things got toned down a bit. (even european regulators have rules, just not so strict)

When that gaming channel closed down the name of the channel changed to babestation.

That channel is not currently licenced with Ofcom. (not all channels on Sky are)

If anyone knows any different then I'm happy to be corrected.

Perhaps the point is that Babestation is subject to Ofcom's broadcasting code, just as the other adult channels are.

If their not licenced with Ofcom why should they be.

As long as they abide by the rules of the european country their registered in then all Ofcom can legally do is ask them nicely if they would follow their guidelines.

Of course when have Ofcom ever bothered with legal niceties and the rule of law when it comes to sex on TV.