BT to challenge BSkYB in broadcasting battle [Newcastle Journal (England)]
(Newcastle Journal (England) Via Acquire Media NewsEdge) THIS is the fight we've been waiting for. It's one that will play out in every living room in the country and will dictate the movement of shares in the telecoms and broadcasting industries.
In the red corner, weighing in with a market capitalisation of Pounds 13.8bn, we have the current heavyweight champion, BSKYB.
In the blue corner, we have the challenger, weighing in at a massive Pounds 21bn, telecommunications giant, BT.
BSKYB has for many years dominated the broadcasting market. The company's foundations have been built on providing world-class sporting content in the UK and 10m subscribers use the company's packages.
In addition to sports, BSKYB has a range of movie channels and also offers broadband and phone services as part of its triple play offer.
Indeed, the company has embraced technology and customers can access live TV on the move through devices such as smartphones and tablet computers by using the Sky Go app which was launched in the summer of 2011.
Last year, Sky Go was upgraded to include a wider range of channels and was made available on Android platforms.
However, the group's dominance is now being challenged by BT.
The telecoms company threw the first punch last summer by entering the auction for the Premier League Football rights for the 2013-14 season.
The rights run for a three-year period and set the structure for broadcasting the games.
BT surprised the industry by aggressively bidding for content and secured 18 first-pick matches which will allow the group to screen some of the best clashes over the next three seasons.
Although BSKYB secured the lion's share of the games, winning five packages, the group had to pay a premium and spent Pounds 2.28bn, or Pounds 760m per season, to keep its position in the market.
BT is a worthy competitor and in part may be defending its own position by adding viewing content to its broadband and phone packages.
Earlier this week the telecommunications business announced a deal to air a number of channels which it has acquired from US giant ESPN.
Some of the channels will be run under the ESPN banner and content will include some of the biggest sports tournaments in the world, along with others which will largely have a niche market in the UK.
The package will include the FA Cup, the UEFA Europa League, National Collegiate Athletic Association Basketball, NCAA American Football and NASCAR, the National Association for Stock Car Auto Racing.
BT is clearly increasing its sporting content to underpin the new sports channels which will be launched in the summer.
And it is expected that BT will also use its existing broadband services to create an online package. It is even possible that BT will add to its current range with further deals in this area.
But it remains to be seen if BT will have the heavyweight clout to knock BSKYB from its dominant position in the pay-TV market.
BSKYB has a head start and customers traditionally require prompting to move to a new service.
However BT's entrance in the market will create greater choice and the group is committed to offering a competitive alternative to the existing services run by BSKYB.
Anthony Peart, assistant director, Brewin Dolphin email@example.com
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