The UK broadband market is becoming increasingly competitive, fuelled by British Telecom (BT) acquisition of 38 live premier league football matches. This package commences in August, and the company are using it to leverage their broadband package. BT broadband customers are to get the BT football for free, whilst Sky customers have to pay an additional £15 for these two new BT channels. Within the past twenty four hours, BSKYB have announced their counter-action: Sky Sports customers get Sky Broardband free for one year when they switch from BT.
How the Premier League screwed BT
Two sources privately confirmed that BTs plan was actually far more audacious when it came to the 2013/14 premier league season. The football rights are sold on a fixed bidding system, where companies submit their bid blind (to what rivals bid). There’s a strong indication that BT bid high enough to win ALL live games, but the Premier League went back to their long term incumbents, Sky, and invited them to secretly bid again. In the knowledge of BTs bid, Sky were able to beat it and retain the lions share of live football.
A new landscape
Despite this, BT got their hand in the game for the first time. Initially it was anticipated that they would use their package in the same way espn, Setanta and others before them did – by making the package subscription based and padding the channel out with B-Tier sports.
Instead BT have used it to start a Broardband war in the UK.
By offering free access to premier league football, BT have pulled off a first. In its twenty year history, the premier league has never been available on a free model.
Now BT have the perfect tool to promote their lucrative Broardband service with. They’ve forced sky to act too, and its been known for some time that Sky have been keen to really push their broadband arm. With ten million paying Sky TV subscribers, they’re reaching market saturation there and need new areas to grow into.
For the consumer, this all seems positive. There’s the potential to save on subscription TV fees for football, potentially allowing more children to watch live football too. A Broardband war should see reducing prices and better value for consumers too.