The TV sports giant’s managing director Barney Francis tells David Hellier that the secret to success is to keep growing in the face of increasing competition
WHEN you’re head of sport at a company like Sky, the satellite broadcaster where covering live elite sport is a major driver of the business, there’s barely time to draw breath. It’s also very exciting and enjoyable.
That’s certainly the impression you get when you meet Barney Francis, who has been at Sky for 14 years and who has held the top sports position in the company since July 2009.
When I meet him, Francis is a man clearly boosted by first quarter company-wide results the previous week that show that, despite intense competition from the new kid on the block BT Sport, Sky is generally in pretty robust shape. He’s just come out of a staff get-together and is buzzing with the feedback he has just got. BT Sport’s entrance into the competition for sports rights has pushed up costs, to be sure, but revenues at Sky have been more resilient than some in the market have expected. Although first quarter profits showed a decline of eight per cent, shares in BSkyB, the parent company, rose to a high of 949p after the publication of the results. Despite a 20p drop on Friday, it reflects the market’s belief that the emergence of BT Sport as a rival has had little impact so far.
“Overall revenue in the group is seven per cent up and we’ve sold 800,000 new subscription products, like SkyGo Extra which enables customers to access Sky content on two additional devices such as a mobile or an iPad. All this shows that we are in a great shape,” says Francis.
Sky began the football season in August in full battle mode. Although there was supreme confidence internally, as ever, others viewed the goings on with a moderate amount of trepidation. Newcomer BT Sport advertised its expensively acquired Premier League matches widely and boasted how many of them were top games.
But in truth Sky has withstood the barrage pretty successfully, thanks in part to its new Saturday early evening audience-led show, which has added a live Premier League match to its already strong showing of Spanish football and reports of the afternoon’s matches in the frenetic Jeff Stelling show. BT will produce its figures on Thursday, giving analysts the first real look at how successful its new sports offering has been at attracting viewers and, just as importantly, new broadband customers. But however good they are, they do not appear to have knocked Sky off its stride, at least not just yet.
“It’s been the best start ever for the Premier League in viewing terms,” says Francis. Total viewing to the Sky Sports channels is up almost 15 per cent, including growth of more than 40 per cent in viewing though Sky Go. “We already had some good momentum coming into the season thanks to the live coverage of the Ashes and the Lions tour.”
But, having survived the first part of the season intact, now comes another likely battle with BT Sport, which is widely expected to bid for the pay television package for the European Champions’ League. Whereas Premier League football is the bread and butter of most football fans’ viewing, the European Champions’ League is the icing on the cake for many. It would clearly be a big blow to Sky’s sports reputation if it lost out. The contract currently gives it two nights’ of peak viewing during many of the winter evenings during the football season when viewers are likely to settle in to watch matches. Some analysts, like Enders Analysis, expect BT to bid if only to push the price of the rights up from the current estimated £60m a year. There is a possibility, perhaps, that rather than sharing the rights between a terrestrial broadcaster and a pay television broadcaster, the European footballing authorities might choose two pay operators, so maybe BT Sport might share the spoils with Sky.
But Francis says that where this has happened in France, where the Qatari-based BeIn Sports and Canal Plus share rights, there has been a problem with the competition losing some of its reach, which has affected its saleability for advertisers and sponsors.
Francis admits that Sky is “in the market,” for the new contract for the European Champions’ League. “We know what we want to achieve out of the process,” he adds.
It would not be a surprise were Sky to have factored in a substantial increase in costs for being able to retain European Champions’ League – Enders says it is likely to pay around 25 per cent more – given BT’s intervention has already cost it an increase of £220m a year in the amount it pays for Premier League rights.
The answer to increasing rights costs appears to be tremendous focus on new services which will bring in additional revenues, as well as boosting broadband and telephony numbers. Sky Go Extra added 219,000 new customers in the last quarter, with Francis himself being one of those to benefit from having live sport on the go. “I watched the First Day of the Ashes Test at Trent Bridge on my iPad on the train up to the match after being delayed by meetings,” he says. “There was no trying to catch up on the score and what had happened when I arrived.”
“The numbers are growing all the time,” he adds.
There’s also NowTV, which charges non-subscribers £9.99 a time for 24 hours access to Sky, which Francis reckons is pretty good value.
Francis recognises that Sky is not all about sports. £600m a year is spent on entertainment, comedy, and drama. And that’s hugely important to the business. And, he says, he’s equally passionate about getting more broadband customers.
“This company has diversified and grown significantly and the customer base continues to rise.”
He gives the impression that he can live with a competitor like BT Sport and downplays suggestions that Sky tried to strangle the new competitor at birth in the summer, with the so-called “project purple”.
“We have 24,000 employees and 100 projects from month to month. There’s no more science behind it than that. We knew there was always somebody that was going to take at least two of the Premier League packages. “So we galvanised and came up with a plan. The idea that there was a cloak and dagger plan behind closed doors has been much written about.”
Then he says that what’s great about his part of the business is that there are 660 people who, if they weren’t working on sport at Sky, would all be watching it at home.
And with that thought he was off to the next meeting, no doubt planning his next move to thwart BT Sport.
CV BARNEY FRANCIS
Education: Economic history at Liverpool University
Barney has worked in television for nearly two decades, within multi-channel, terrestrial, and independent sectors. At Sky Sports he has produced a range of live coverage, support programming and sport news content. As executive producer for cricket from 2001 to 2007 he was responsible for Sky’s exclusive live coverage of domestic Test matches and the introduction of a range of new cricket shows plus production innovations such as Ultra Motion replays, Hot Spot graphics (pictured, left) and the UK’s first live HD sports broadcast, the 2006 Test series against Sri Lanka. As Managing Director since 2009, he has seen Sky Sports continue to grow with the Masters and F1 coming to Sky.
He is married, with two boys.