The Sky is falling!

Don’t worry the sky is not literally falling. Or if it is that isn’t what I’m writing about. No I’m writing about the news that leaked out on a frantic weekend of 1st round FA cup football and league fixtures that Sky and ITV will no longer have the rights to show champions league and europa league football from 2015 onwards.

BT sport apparently wiped out the bid from sky by paying an eye watering £897 million for exclusive three year rights. I know BT sports already air the FA cup and some premier league games but this was for me was not only a statement of intent but a portent of things to come. It showed that that unlike the short lived Setanta Sports, or even ESPN, that BT mean serious business.

 A quick google search suggests that as of June 2013 sky had 10,459,000 customers in total. Some these like myself may only be basic subscribers but for many the huge draw of Sky is the sports package. Unlike countries such as the US where a large quantity of providers compete to show sports since the dawn of Premier League football Sky worked towards and almost achieved a monopoly on sport. If you want to watch league football. Sky was the only choice and in other sports Sky were (and for the moment still are) the biggest providers in town. England rugby autumn tests are on sky. 2 out of the four golf majors are exclusively on sky as is the ryder cup. Ashes cricket and indeed all England cricket is on sky. In short Sky knows that sport sells and it made sure that it was the biggest provider in town.

This sporting dominance was compounded by use of financial muscle to dominant the TV movie market as well. Sky brought the rights to show box office films at a premium once again ensuring that it was the biggest player in town. Now though like in sport this dominance is under attack services like netflix and lovefilm are bidding for the rights to show these films as well. The day is probably not far off, if it has not already arrived, where Sky isn’t able to show the release of the new James Bond or Marvel Superhero film first as some else secured these rights already.

The underlying driving force behind these moves is the growth of the web as in becomes the key medium whereby tv programmes are delivered to our homes. Companies like netflix or BT seeking to use the internet to change the way television is consumed. Whether or not these specific companies win is irrelevant the merging of the tv and internet is inevitable. As this merger occurs however prices will drop for consumers and at the very least Sky’s profit margin will come under strain. Sky of course have already begun to anticipate this shift with its move into the ISP markets. For once though Sky will not be able to overwhelm its rivals with its financial muscle. I don’t know how many people will be Sky subscribers in the UK in 2015 but with the rises in the cost of living being what they are and the news of content loss today I’ll bet it is not anywhere near the levels it is today.

 

 

 

 

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