BT has been caught ‘utterly unawares’, following broadcaster BSkyB’s stated plans to increase retail pricing of its sports channels, according to the Guardian.
The announcement follows just days after BT’s IPTV service, BT Vision, signed a wholesale…
BT has been caught ‘utterly unawares’, following broadcaster BSkyB’s stated plans to increase retail pricing of its sports channels, according to the Guardian.
The announcement follows just days after BT’s IPTV service, BT Vision, signed a wholesale agreement with Sky to deliver Sky Sports 1 and Sky Sports 2 to its customers on a pay-as-you-go basis.
Under the new wholesale pricing mechanism set out by UK regulator Ofcom. Sky has upped the price of Sports 1 from £10.63 a month to £13.42, and Sky Sports 2 from £10.63 to £13.34.
This will mean, the report said, that BT will lose money on each customer it signs up to sports packages on BT Vision, which announced its £16.99 per month pricing scheme for the two channels. BT had also announced a 24-month bundle total sports package, which it said costs £205 less than Sky’s annual cost and £281 less than Virgin Media’s yearly fee.
BT responded: “We are proceeding as planned and will deal with the issue of Sky’s wholesale pricing in due course. It’s surprising that Sky are raising prices for their customers just when we’re about to enter the market. This will only make our prices more attractive and so could drive customers to our door.” From next month the cost of Sky’s top-end package – including movies – will go up from £48.50 to £51.50.
Ofcom, for its part, said that because it was a given that retail prices would increase, the regulator had set a fixed margin between Sky’s retail prices and wholesale prices. So if the broadcaster’s retail prices change, its wholesale prices would move by a fixed amount. Announcing the pricing of the new package, BT Retail CEO Gavin Patterson declared that “A more competitive market will ensure that customers continue to get the best sport for the sharpest prices and this opening of the market will be in the best interests of customers.”
