Sky News Update: Sky Raises TV Charges
Sky News Update: Sky raise costs of their TV packages in response to rivals’ BT’s campaign to deliver free sports channels for their broadband customers.
Despite serious competition from new rival BT for their pay-TV service, Sky have announced that their customers may face price increases of up to 10% as of September 2013. It immediately follows the rivals’ price increase on one of their budget tariffs.
This price rise, hot on the heels of the 7.5% on entertainment packages and 5% on sports packages rises in September 2012 has confirmed that the competitors’ rivalry will focus around their broadband costs as opposed to TV packages. The summer of 2013 is promising to be big in the world of sport – with the ICC Champions Trophy and the Ashes, the Tour de France starting in Yorkshire as well as the normal events such as Wimbledon and the Premier League all taking place in the UK the demand for coverage is at a peak and these two companies are jostling for popularity.
It has been suggested that BT’s August launch of the sports coverage package has been timed to sustain their broadband service. Sky are tipped to make a significant cut to their broadband offers in response to this. It has been suggested that the price war will occur over the broadband offers because the two sports channels are looking to provide predominant coverage of different sports – cricket and F1 for Sky and live coverage of every Premier League match for BT. The two companies have, collectively, paid a total of £3bn for the rights to screen every Premier League match but Sky paid more than BT stumping up £760m per year in response to BT’s £246m.
BT are striving to ensnare customers with their promise to deliver all of their BT Sport channels for free to their broadband customers. However, the recent 9% rise in their line rental saver plan has raised a few eyebrows, if customers have to pay more for their broadband service then BT are not rivalling Sky. Customers are gaining nothing.
Sky have recently seen off other competitors such as ESPN to ensure that they remain top of the rankings when it comes to sports coverage in the UK but BT are looking likely to put up more of a battle against the major company. Sky are striving to be more diverse with their other services as well, permitting SkyGo users to view whole seasons, download episodes to up to four devices and view their sports highlights. Their Sky Movies packages are also offering more specific channels such as Disney and James Bond specific channels. All of these things are signalling towards Sky having to rethink their structure in order to remain a significant presence in the market suggests that there may well be an opportunity for BT here.
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