The Sky’s the Limit
06 April 2009
The news that most analysts expected was confirmed recently when
BSkyB (Sky) retained its broadcasting hold over the Premier League
for the next three years.
It has been awarded five out of the six available packages. The
Times newspaper reported that Sky has paid around £1.6bn paid to
the Premier League for the five packages comprising 23 live matches
each season. It was announced recently that Match of the Day will
stay on the BBC for the next three years in a deal worth a reported
£173m.
Two of the auction packages went to a second round after Sky won
the first four. It was announced on 6 February 2009 that Sky has
gained a further foothold in the live Premier League market by
snatching one of the remaining two live packages away from Setanta.
From the 2010-13 season, Sky will screen five out of every six live
Premier League games for three years.
It was rumoured that as well as Sky and Setanta bidding for the
live packages that ESPN were in the running. Owing to competition
law concerns expressed by the European Commission before the last
broadcasting auction, Sky could not win all six. Setanta, who won
two live packages at the last auction were keen to hold on to them
to further drive its pay-TV channels. Many analysts see Sky winning
five out of the six packages as a huge blow to Setanta.
It would appear that Sky has sunk a dagger into the heart of a
rival by stealing one more package away from Setanta. It appears
now to be harder for the Irish broadcaster to entice more
subscribers to its channels because it has fewer live Premier
League games to offer. This appears to be a significant blow to
Setanta who would have been keen to maintain and even increase its
presence in a market most media analysts see as key to driving
pay-TV subscriptions.
The doomsday scenario for consumers in Britain would probably
have been Sky, Setanta and ESPN all winning a packaged rights
product. This would have meant that for the first time in live
Premier League history, subscribers having to pay three different
pay-TV operators to watch a comprehensive set of live Premier
League matches. That risk has now evaporated with the news that Sky
won five of the packages only leaving Setanta
with one live package deal to promote to its subscribers. It now
remains to be seen whether Sky increases the price of its Sky
Sports offering to customers to claw back the additional cost of
purchasing one more set of live games.
The final figure the various broadcasters have paid for these
sought-after rights amounts to £1.782bn, which is about a 5%
increase on the previous deal. With the foreign broadcasting deal
figures yet to be announced, any increase in the overall £2.4bn
figure (received for the 2007-2010 seasons) will certainly be
greeted with broad smiles from all 20 Premier League chairmen.
For further information, please contact Daniel Geey.