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BT strikes up a footy deal with BSkyB

Steve Dinneen
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BT HAS finalised a deal with BSkyB to offer its subscribers top-flight football next season.

The move, which means football fans can watch their teams on BT Vision for the first time, could rock Sky’s dominance of the pay TV market after decades controlling the lion’s share of subscribers.

It follows a controversial Ofcom ruling that Sky must immediately slash the wholesale price it charges rivals for Sky Sports 1 by 23.4 per cent to £10.63 a month. The wholesale price for both premium Sky Sports channels together was cut by 10.5 per cent to £17.14.

BT says it will release prices for the channels soon but they are expected to compete heavily with Sky.

BT Vision director Tony Ball, a former Sky chief executive, has been privately pushing for BT to offer the football at massively reduced rates for customers who also sign up for its fixed line and broadband services.

Sky’s closest rival Virgin Media, with 4.5m subscribers to Sky’s 9m, is also expected to release its pricing information soon.

Sky has taken Ofcom’s ruling to the courts and had hoped to block the price drop until a
full hearing, expected next year. However, it was decided the difference between Sky’s intended price and the enforced cap should be paid into an escrow account, which will eventually be handed to the victor.

Gavin Patterson, chief executive of BT Retail, said: “We are delighted we can be certain of offering Sky Sports 1 and Sky Sports 2 to our customers before the football season kicks off. We know our customers will be keen to sign up for the two channels.”

Ofcom says opening up the market could lead to an extra 2m consumers of premium TV channels by 2015 and estimates Sky could gain £600m over five years through extra wholesales.

However, Sky believes the gain could be eaten by its subscribers leaving for cheaper rivals. In a move described by Sky as a “sop”, the broadcaster has been given the go-ahead to sell its premium content through Freeview, meaning it could reach millions of homes that do not subscribe to its satellite package.