Sky Sports can charge more on BT and Virgin

BSKYB has been allowed to up the prices it charges broadcasters for the right to screen its sports channels.

The changes are expected to affect BT and Virgin Media’s wholesale agreements with Sky, while TalkTalk has a deal meaning it is not affected.

Virgin Media – which does not make a significant profit on selling Sky Sports – is understood to be likely to pass on the hike, though BT has no plans to do so. If BT chooses to freeze Sky Sports prices on its BT Vision platform, it would cut into its profit per user, signalling its willingness to sacrifice margins in order to sign up customers. BT is already giving away its new sports channels to broadband customers in an effort to stop them defecting to Sky.

The price Sky can charge for wholesaling Sky Sports 1 and 2 is decided by Ofcom, and is based on how much Sky charges its own customers. Sky is upping retail prices by up to 10 per cent, and Ofcom has responded by increasing the amount it can charge Virgin Media and BT. It will be able to charge £14.73 per user for Sky Sports 1, up from £13.87, and £20.87 for both, up from £19.41.

“BT has no immediate plans to review its prices for Sky Sports 1 and 2,” a spokesperson said. Virgin Media did not comment.