BSkyB Agrees To Pay An Average £4.76 million ($8.9 million) to Televise Exclusively, Including Broadband, Each of 92 UK Premier League Football Matches Per Season From 2007 – 2010, But Mobile Operators Say Football Is Getting Too Expensive For Their Tastes

The deal should meet EU requirements that rights to all the Premier League games should not go to just one broadcaster, as they have for the past 14 years to Sky, and also that mobile rights be auctioned separately. BSkyB won four of six separate packages up for grabs, including the A and B packages said to be of most interest to viewers for its 92 games while Setanta gets two packages for its 46 games.

The EU was also anxious that the bidding be opened up to mobile phone operators and that auction has yet to occur, but the major UK mobile phone companies are indicating they believed football on the mobile is not as valuable a commodity as once thought. In 2003, BSkyB, Vodaphone and 3 paid $100 million for Internet and mobile rights in a deal that ends at the end of next season.

But mobile operators say that football is so available on television that its value has diminished for the mobile screen. The experience thus far for 3 is that football clips on Saturdays after the games are popular, but usage during the rest of the week is way down. SkySports News is available as a streamed TV channel on some handsets and for those users that takes care of their football needs.

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Under the current rights Sky has started to show Football League play-offs on the Vodaphone Live! 3G service and the Sky Mobile TV Service will televise 15 matches during May.

The one disappointment for the football fan will be that none of the Premier League games will appear on free-to-air broadcasting. But for Sky, that basically has built its franchise on football and movies, it’s a win-win since the Setanta service is available on Sky’s pay-TV platform.

The main loser in the bidding was Sir Richard Branson whose Virgin mobile phone company recently merged with NTL to form the UK’slargest residential broadband communications company. It is the country’s sole provider of quadruple play services -- – Internet, television and telephone over a single broadband connection – plus mobile.

Branson had said he wanted to create a new sports subscription service to be called Virgin Sports, but apparently the bidding got too rich even for him.

Sky had to do whatever it had to do to maintain its Premier League coverage. About 5 million customers subscribe to the £40-a-month sports package – that’s £2.4 billion annually— and without the Premier League’s best matches that business would be severely hit. Still it’s a 30% increase over what it had paid before and that will have to hit the bottom line somewhat.

And a question needs to be thrown at the EU – what good did it actually do to insist that one provider could not buy all the TV rights? No doubt the EC competition authorities wanted to open up the Premier League to more television competition which usually means lower prices for the consumer. But in this case it seems the consumer is going to end up paying more, not less.

With Sky paying so much more for its matches it is unlikely it will lower its charge for its sports package. That means that to also catch the games that Setanta is televising the consumer is going to have to pay additional. So in the end the consumer ends up paying more, not less. The possible exception will be for that fan who only wants to watch a little football each week – rather than saturation – and would pay Setanta’s lower price of around £15 monthly instead of Sky’s £40 for the big package

In the UK, pubs, restaurants, clubs etc., are required to pay a license fee to show television programs to their customers, and Sky gets from them about £200 million ($372 million) annually for its sports programming. A spokesman for the British Beer and Pub Association, which has fought Sky’s charges for a very long time said it feared Sky would increase its pub charges to gain back some of its higher rights payments.

Sky, meanwhile, is said to already be in talks with Setanta to include their games in the Sky pub license

Of course the big winner is the Premier League itself and each of the 20 clubs will get at least £30 million, much of which will go to pay even more for football players. A Professional Footballers' Association survey released last month said the average Premiership player earns £676,000 a year ($1.25 million) and that figure rises by between 60% and 100% when bonuses are taken into account.

Meanwhile, BSkyB reported an 8 per cent increase in third-quarter net profit, but the 40,000 net subscriber growth for the quarter was less than half the subscriber increase in Q1, 2005. Net profit for the three months ended on March 31 rose to £151 million ($366.24 million) from £140 million a year ago. Revenue rose 11 per cent to £1.06 billion.

The broadcaster now has 8.1 million subscribers - it has a target of 10 million by 2010 - and forecasts adding 600,000 in the final quarter of this year following the rollout of new products.

BSkyB Agrees To Pay An Average £4.76 million ($8.9 million) to Televise Exclusively, Including Broadband, Each of 92 UK Premier League Football Matches Per Season From 2007 – 2010, But Mobile Operators Say Football Is Getting Too Expensive For Their Tastes

The UK’s Premier League has just sold domestic television and broadband rights to its matches in 2007 –2010 to BSkyB and Irish broadcaster Setanta for a total of £1.706 billion ($3.27 billion) – a 60% premium over the last deal won exclusively by Sky in 2003.