ref="http://www.cityam.com/company/bt-group">BT SAYS its sports offering is the first step in an aggressive expansion into pay-TV it hopes will eat away at Sky’s dominance of the market (at last count Sky was tantalisingly close to 10m subscribers, while BT is languishing with less than 500,000). But BT would do well to bear in mind the cautionary tales of previous firms who tried to take on the satellite giant.
ONdigital, launched in 1998 as one of the first digital TV offerings, initially involving a tie-up between Sky, Carlton and Granada.
However, when Sky was forced to withdraw from the consortium, it was effectively placed in direct competition with the venture, later rebranded ITV Digital.
Despite regulators ensuring Sky wholesaled its Sports package to its rival, a blistering advertising drive by the satellite broadcaster trumped its rival at every turn. ITV Digital responded by buying the rights to non-Premier League games but buckled under the weight and went into administration in 2002.
Setanta was also forced out of business in the UK last year after attempting to chip away at Sky’s dominance of the Premier League market. After launching a rival service it expanded too quickly and was pulled under by its mammoth costs.