Re above post - there is a key twist as suggested earlier by Gray77. If Sky is willing to go to £1.2bn but thinks it will lose what it can do instead is still bid £1.2bn but for packages only totalling fewer games - eg 90 games instead of 116. That way it can significantly increase what it pays for each package and potentially move itself from a losing to a winning position - for those 90 games - cross ref back to earlier discussion re key packages / doing without non-key packages.

But if it really wasn't willing to pay more than the £1.2bn it would have to not bid / withdraw bids on other packages to avoid risk of winning 116 games at a total greater cost - cross ref back to earlier discussion!

I would have thought it would be a priority for Sky to at the very least win a majority of the EPL rights so that they still remain the "must have" option for anyone who wants to watch EPL games.

Agreed.

So in effect they face a gamble - bid as high as they can but at an amount on each package with the hope of winning 116 games as at present - or concede that the first strategy will lose and bid more per package but trying to win fewer games.

But it's actually very complicated because Sky will surely want bids in on all 7 packages so that they win whatever packages BT doesn't win - ie BT can only win 5 - so even in the absolute worst case scenario for Sky they will still win 2 but they need bids on all 7 to be submitted to pick up those 2.

So if Sky decided to settle for winning 90 games (ie 4 packages) what it would presumably do is bid very high for those 4 packages but then also bid at a comparatively low level for the "other 3". They would be assuming BT would outbid them on the "other 3" so they wouldn't win them if they got the "best 4" but if they lost all / any of the "best 4" to BT they would assume their bids on the "other 3" would be high enough to beat anyone other than BT.

(Assuming no other major bidder like AJ or Vodafone complicates the matter!!!)

If it were just Sky and BT though, could the "90 games" strategy not leave Sky at risk of ending up in BT's current position, with only two packages? If BT manage to outbid them on the best 4, and then end up outbidding them for one/all of the other three (probably assuming Sky will win one or more of the "main" packages so ensuring they win "something"), obviously they could only win 5, but this would leave Sky with the smaller number of games.

And great for BT from a marketing prospective.

Is there any possibility of the Premiership creating more packages? Or might this result in lower overall income assuming just the two existing bidders?

I do wonder if, rather than bid gargantuan amounts to deal a hammer blow to the other side, Sky and BT might show more willingness to co-exist than we might anticipate. I'm not saying that the two companies are going to engage in collusion to carve up key rights between themselves but I do think we will eventually reach a sort of natural equilibrium where both Sky Sports and BT Sport are successful - and are perhaps joint number 1's in terms of content.

The above may well make sense in the long run and in theory.

One other point in favour of the above for both parties is the difficulty of making a "hammer blow" when the prime football rights contracts each only last 3 years:

ie if anyone scores what looks like a "knock-out" blow they are facing another auction pretty quickly - eg next CL auction will be only 3 months into the next PL contract if timetable unchanged.

But I think the question is how is such an equilibrium arrived at?

The issue is that Sky has such a dominant position in non-football Pay TV sports rights and so many of those contracts are very long term that if BT wants to get to a broadly overall 50:50 sports position it is going to have to get much more than 50% of the prime football ......

Which in turn means BT is going to have to bid very aggressively because Sky isn't going to easily concede over 50% of the prime football .......

Which is exactly what BT did in the CL auction.

MLT11, would BT really want the bulk of prem games after the next round of bidding?

Surely 3 decent packages would suit them fine and as I said yesterday the mid week package would fit in nicely following on from mid week Champion League rights.

We know they have loads of money and could go well over the top but at what expense?

I think a 4-3 split would even suit Sky, however the question would be who gets the 4.00 Sunday slot and I think everything points in Sky's direction for that.

I'm sure BT would love to have the bulk of Prem games - we know they tried to win 5 PL packages at the last PL auction.

But it ultimately comes down to cost - ie how much is BT willing to spend?

We know BT has deeper pockets than Sky but Sky has the subscriber incumbency advantage so if BT bids very high and wins it is likely to lose a substantial amount of money on its PL rights in the short term and probably the medium term - all for the prospect of a long term benefit that is extremely hard to quantify and also uncertain in the sense it will depend on many variables which are also hard to predict.

eg If BT won 4-3 (ie BT 90 PL games, Sky 64 PL games - but Sky had Sun 4pm), how many people would cancel Sky Sports? How many would cancel Sky Sports and all Sky TV? It's impossible to predict even within a very wide band and would depend on numerous other factors like what happens to other content, Sky broadband pricing, BT and other competitor TV and broadband pricing etc.

And how many would pay for BT Sport and at what price and what would BT's optimum pricing be and how many would switch to BT broadband etc etc etc.

You could get the best brains to do the most detailed analysis and even then it would probably be miles out - it's just impossible to predict.

BT ready for more 'eye-watering' TV rights bids after Champions League

http://www.theguardian.com/football/...sums-tv-rights

My understanding is that only Ofcom-approved PSB channels can show the World Cup, and BT would have to be on a PSB multiplex to even apply for this. Is this correct?

You have to apply to OFCOM to be a "qualifying channel".

The test OFCOM will apply is can 95% of homes get the channel without paying a Pay TV sub.

As I understand it, that means you would have to be on a PSB multiplex to have any chance - and even then I'm not sure you would be guaranteed to qualify.

Will never happen....as for the Prem League rights, we all know BT will want a larger slice of the action, its a must for them.

BT need to back away from the World Cup talk. They are starting to look as ugly and aggressive as Sky.

Not sure why Freesat doesn't come into the equation as it's the official FTA platform that's raison d'etre was to give full UK coverage for the PSB portfolio channels after DSO.

Thought Sky putting Pick on Freesat was a step towards it becoming a qualifying channel.

Freesat does count.

But remember the test isn't about 95% being theoretically able to get the channel.

The question is:

As of the day when OFCOM does the test, with the equipment installed in homes and actually "plugged in" and being used as at that moment, can 95% get it?

Good point. I cannot see any point in them going after World Cup games at all, even if they did qualify for the 95% rule. All they would be doing would be taking games from BBC and ITV and sticking them on their own channel. That wouldn't be 'taking on Sky', it wouldn't be 'making football cheaper' and it wouldn't be 'giving sport back to the people'. It would simply be greed and throwing money at anything with a price tag, regardless of any benefits it may bring.

They use the word 'available; not 'get'.


http://stakeholders.ofcom.org.uk/bro...sports-events/

OK, thanks - but by "available" I think they mean "get".

During the debate about C5 becoming a qualifying channel the focus was entirely on how many could actually get it.

It's semantics really - if you would need to go to a shop and get some equipment and then get it installed it isn't available to you at that moment.

At that time (March 2008) C5 was not FTA on satellite but encrypted by Sky on a pan-European beam. It went FTA in November, 2008.

It appears only DTT and cable reception was considered, possibly because of the need to buy a viewing card.


http://stakeholders.ofcom.org.uk/bro...annel-5-listed

Great debate on previous page. Only thing i would throw into the mix is commercial subs and whether the extent to which sky/bt expect commercial sales to grow/decline?

Roughly what proportion of pl rights cost do bt get back from pubs/clubs?

Jeremy Darroch has been talking publicly for the first time since the BT Champions League deal - reiterated that he wanted to see a mutual wholesale deal between BT and Sky for their respective sports channels.


http://www.reuters.com/article/2013/...medium=twitter

He may want a mutual wholesale deal but BT may well not agree to that if the main purpose of BT Sport is to boost BT broadband.

Cross-ref to earlier discussion - I guess one thing BT needs to bear in mind is that if it were to win the majority of PL packages then it may be forced to wholesale BTS to Sky - which then in turn changes a key part of the BT Sport business model.

The above could be dependent on that Court of Appeal verdict on BT's appeal against the CAT decision - that seems to have been forgotten but it's still pending and I think BT said at their last results that it was expected before Christmas.

That verdict may, at least to some degree, sort of set a benchmark for future regulation of the issue.

A mutual wholesale deal would be in the interests of the consumer to the extent that you would have more freedom and options available.

The danger for BT Sport is that Sky would use their channels in broadly the same way as BT - ie if you take Sky Broadband we will throw in BT Sport free OR we will discount BT Sport or offer it free if you take it as an add-on to taking Sky Sports.

The danger for Sky is that BT would be able to offer Sky Sports as a standalone package - something which Sky do not do. They could also discount Sky Sports if you take BT Broadband etc

Each side would get the wholesale fee from the other irrespective of any discounting etc

So more choice for the consumer but maybe less appealing to BT. On the other hand if they pump billions into sports rights but in the longer term they don't recoup it through subs or Broadband sign-ups then they have failed. And as each set of footy rights is only for three years do they want to keep repeating the same exercise.

Some sort of mutually beneficial wholesale deal might be the best solution for all here on balance and avoid any march to mutually assured destruction.

delete