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BT and Sky in £4.46bn Deal to Show 160 Premier League TV Matches

Tuesday, February 13th, 2018 (7:23 pm) - Score 875
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Both BT and Sky UK (Sky Broadband) will continue to spend big on their respective UK Pay TV platforms after tonight reaching a £4.464bn deal, which will allow them to show Premier League Football matches for a further 3 years from the 2019/20 season onwards.

The battle between BT and Sky reached new heights in 2015 after Sky spent around £1.392bn and BT splashed out £320m per season on a major Premier League TV football rights deal for the 2016/17 to 2018/19 seasons (here). But in recent months the once bitter relationship has begun to thaw, not least due to several agreements related to the cross-platform supply of premium TV and related sports content (example).

Under today’s new deal BT will continue to show Premier League matches on BT Sport for a further three years from the 2019/20 season, which will cost the operator £295m per season for 32 games (down sharply from 42 matches under the previous deal). A deposit of £26.5m is payable this month followed by six instalments of around £145m starting in July 2019, payable every six months until December 2021.

BT Sport will continue to show games at 5.30pm on Saturdays next season and then move to Saturday lunchtime fixtures from August 2019. Meanwhile Sky has bagged four packs of rights totalling 128 games a season, which is up from 126 matches currently.

The deal will offer Sky Sports viewers every first-pick weekend match, plus Saturday evening fixtures for the first time. Sky has chosen to pay £1,193 million per annum under the terms of the new deal, down £199 million per annum, a 16% cost reduction per game versus the previous agreement.

Marc Allera, CEO of BT’s Consumer division, said:

“The Premier League is undoubtedly the most competitive and exciting domestic league in the world, so we’re delighted that our customers will be able to continue enjoying Saturday games on BT Sport.

The Premier League is a big part of our live sport line-up, which includes the UEFA Champions League and UEFA Europa League, the Emirates FA Cup, MotoGP, boxing, Aviva Premiership rugby and European Rugby Champions Cup.

BT Sport is enjoyed by over five million households and pubs and clubs across the UK. We are excited about the opportunity to bring this great content to even more TV and mobile customers as we pursue our strategy of being the best provider of converged network services in the UK.”

Stephen van Rooyen, Sky’s UK CEO, said:

“We continue to invest in content that our customers value and which complements our strategy to broaden our offer. Not only do we remain the home of Premier League football but also the home of top quality drama, entertainment, comedy and other sports. Our disciplined approach means we continue to have the flexibility to invest in each of these areas as we choose, underlining our position as Europe’s largest investor in content.”

Today’s agreement with the Premier League means that five of seven live packages have now been awarded, with bidding for the remaining two ongoing. Some earlier rumours have suggested that Amazon may be making a major play to help give its video streaming Prime platform a boost. The same has also been said of Facebook, Netflix and oddly even Twitter. Both BT and Sky are understood to still be engaged in the bidding process.

On the other hand today’s news will probably do little to dampen complaints from some quarters, not least over the ever increasing price of viewing such content. At the same time others continue to suggest that BT should be investing such money into rolling out ultrafast broadband networks to even more of the UK, as opposed to trying to battle Sky over Pay TV content.

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Mark Jackson
By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he is also the founder of ISPreview since 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.
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25 Responses
  1. asrab uddin

    By not deploying Fiber – BT stand to loose the most when it comes to broadband subscribers, they should really focus on upgrading their networks and once the network is in full deployment they can then focus on these sports channels and offer this as a premium service on their new network,

    The question should also be – what new products and services can BT offer on a full fiber network to the average Joe to create new revenue streams, guess they are not thinking outside the box,

    • Steve Jones

      Do you not realise that this is a BT Retail investment in content? It’s the job of BT Retail to make money from its own business activities. If BT Retail could somehow provide capital to Openreach to invest in fibre (a mechanism that doesn’t exist), then the fibre investment would be provided equally to all ISPs who would be making the increased returns. Openreach get none of those content revenues.

      Why it is that people seem to be completely unable to understand that the functional separation of BT by regulation inevitably leads to BT Retail having to make investment decisions on retail products and Openreach making its decisions on the returns from wholesale returns on infrastructure is one of life’s great mysteries. It seems to point to something fundamentally wrong with the education system.

      Let’s make this clear. Openreach have to make their own decisions based on their own commercial criteria. BT Retail at not allowed, by regulation, able to make any decisions with regard to OR’s investment decisions.

    • Steve Jones

      “are” not “at” in that final sentence of course.

    • New_Londoner

      @Steve
      To be pedantic, it should be “is” not “are” in the final sentence. 😉

    • wirelesspacman

      Probably Steve because BT Retail and Openreach are under the same ownership – BT plc. Whilst that continues to be true, I doubt that many will believe they really act independently of each other.

    • GNewton

      @Steve Jones:

      “If BT Retail could somehow provide capital to Openreach to invest in fibre (a mechanism that doesn’t exist)”

      It is not quite like that. Openreach is wholly owned by BT, Openreach’s budget is controlled by BT, and the network assets are owned by BT, not Openreach. I can understand why you as a shareholder are interested in BT making a profit, including its sports adventures. But we have to see the whole picture here!

    • Steve Jones

      @GNewton

      Whilst it’s true that the overall financial targets have to be agreed between BT and OR, the network strategy is decided by OR. If they can meet financial targets by increasing capex, then that is not an issue. The problem is that, ultimately, it can only be done on wholesale revenues, not on any retail returns. There is a mechanism for the retail ISPs (including BT Retail of course) to increase the amount of fibre investment, and that is to make some commitment to stimulating demand to increase OR revenue to pay for this. That means selling more premium-rate products.

      There is no magic money tree. The logic of OR separation, whether functional or structural, is that the wholesale business has to financially stand on its own feet. If the ISPs feel they can grow their businesses and sell more premium products with a massive increase in fibre, then it has to be reflected in the income to OR. If capex exceeds depreciation, then it can only be paid for by reducing other costs, increasing wholesale revenues or some combination. Given that the OR will be operating a hybrid network for the foreseeable future, and there’s no power to shut down the copper network (which would take a couple of decades anyway), those costs aren’t going to reduce for a long time.

      The position can be compared with what is happening in Hull and Kinngston where there’s an effective monopoly of both infrastructure and retail. There a financial case can be made as the full retail revenues can be considered. Not just that, but the copper network can be retired as suits the company.

    • FibreFred

      He’s been told time and time again Steve.

      He either (still) doesn’t understand, or doesn’t want to understand as it doesn’t fit in with his agenda.

  2. JW

    I can’t believe how much money is wasted on this sport, for TV rights, when the players are so grossly over paid.

    On the other hand as mentioned above, BT can splash this cash on TV yet not on fibre. Before you say that openreach is a separate company, where did this cash come from, before they were separated! Shows how much money they have not been investing (same as the post office, made lots of money, but that money was siphoned off)

    • John Miles

      Yes but if BT spent that £300M on FTTP that would probably get it to about 400k properties, or 2% of the broadband installed base. FTTP is expensive.

    • occasionally factual

      BT Retail get to keep all the TV money so can make a profit. And is not regulated by OFCOM

      Openreach (BT) are only allowed by OFCOM to keep a small percentage of any money from line rentals (copper or fibre) so making it harder to make a profit. Any fibre or copper line must be made available to any ISP who wants to use it at a low cost set by OFCOM. Little or no profit, means no money to invest as money has to be raised by borrowing and paying interest on that loan.

      So easy to see why TV rights are better for the company.

    • AndyH

      It’s a fundamental mistake if you think that this money is just sitting around in BT’s bank account and can be spent wherever it wants.

      The football rights money will be recouped by sales of their BT Sport to both consumers/business and any other revenue generated from this, such as television advertising.

  3. Brett

    It’s disgusting that Sky have spent so much money on TV rights. They should give this money to openreach to roll out fibre.

    • Bawlk

      Sky haven’t even mentioned anything about G.fast yet.

    • apolloa

      No just ‘one football league rigjts’. Since the last stupid spend on games the majority of premier football clubs got richer.. hence the more odd new and frankly disgusting wages paid to people kicking a leather ball about.

      And bang on queue they have announced price increases to all their broadband and phone customers, TV ones will follow, and knowing how it works they’ll be more rises mid year too.

      Got to pay these poor footballers 500 grand a week! Sky has an AWFUL lot to do with the current state of mega rich football clubs in this country.

  4. GNewton

    @Steve Jones: “The problem is that, ultimately, it can only be done on wholesale revenues, not on any retail returns.”

    Can you provide a link which explains as to why the owner of Openreach can’t put in more investments into its fibre networks? Other than shareholder’s short term interests?

    • AndyH

      @ GNewton – Steve Jones has explained this, so I’m not sure why you’re asking these rhetorical questions.

      If Sky, TalkTalk and Vodafone were selling Openreach’s FTTP product, then there would be a stronger business case for expanding their network even further. However, none of those operators are selling Openreach’s FTTP and it looks likely that none of them will sell it in the future. What is the value in making significant capital investments in something that the majority of the market refuses to sell?

  5. GNewton

    @AndyH: I think I’ll let Steve answer this question. I am not here to argue with you, you don’t seem to understand the point.

  6. Ryan

    Remember that BT is also bound by the USO and the finial commitments that will provide for BT for the next few years. It’s always been said it was for financial reasons that homes sub 10MB download speeds were not being covered for things like fibre broadband. There’s also the line rental charge reduction to £11.99. Given that BT holds over 75% of landline only customers….its a huge loss.

    • Salek

      Ever the more reason to invest in full fibre and unlock new revenue streams if they are to survive in their current entity,

    • AndyH

      @ Salek

      If we’re talking about the final 5%, then these are commercially unviable areas for FTTP. Without some form of funding, no operator would deploy to these areas.

      Full fibre does not bring additional revenue unless:

      1) Other main providers (Sky, TalkTalk, Vodafone) sell the product

      2) An increasing number of people take higher speed variants. Still 80/20 and 40/10 account for c. 90% of all Openreach FTTP connections.

    • Salek

      Mr Ryan – not referring to the final 5%, but to the overall market, imagine what new services the could offer on a symmetrical gigbit service if they had this product for the consumer, with the internet of things becoming more common, connected cars and so forth, they really need to ready offer new product and services which are currently being held back to to coppers limitation, one example – i would never do a cloud backup on a 80/20 connection but if it was over a 1000/1000 connection it would not be an issue

    • AndyH

      @ Salek

      What new services could you offer on a symmetrical gigabit connection?

      How exactly do cars benefit from residential gigabit connections?

    • Ryan

      No, I am referring to the final 5%

  7. Just dropped by

    What a complete arse you are mr newton.

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