If you’ve seen the news in the last 24 hours or just paid attention since last night then you’ll have seen the news (or huge advertising campaign) from BT around their new sport channel. The main gist is that it’s free! But is this actually the case?
Before answering that question its probably worth having a quick look back. Sport rights and in particular football have been responsible for the downfall of ITV digital and ESPN so far due to the large amounts of money involved in buying the rights. However the current rules don’t allow Sky to buy all the rights to the live matches. So dispite the track record of previous companies that have tried there still has to be someone else buying the football rights.
So what’s different about BT? Well their a telco who is trying to get into television. They have huge established customer base bringing in a large income. The amount they spent on the football rights is actually small change to them. So in the world of converged phone, broadband, TV and mobile then the person who has it all – and most importantly the content – is likely to come out on top.
So the news that BT Sport will be “free” is a fantastic piece of marketing but is it really the case?
The answer cones down to how do you view your phone line and broadband. There is a legal right to a phone line (like water and electricity) and more recently there have been discussions about adding a basic level of broadband into that mix. Either way a broadband connection has become a must have for many households up and down the country.
So if you are already paying for a broadband connection and the landline it comes over then monthly its not going to cost you any more to get the sport channels. This suddenly makes it attractive to a whole market of people who would not or could not pay more for this television.
Even more interesting – it looks like if you are a Sky customer with BT broadband internet then you’ll get the channels exactly where you expect them – on your Sky box so everyone is happy.
The only down side I can see (aside from one off setup costs) is that unless you are on their fibre broadband you may end up limited to watching SD only or via your computer/tablet/phone.
So overall this is a fantastic and well thought out move by BT who stand to win almost any way. Estimates in the press make it look like if only as little as 5% of existing phone customers move their broadband and 5% of non customers took up the offer then it would pay for the outlay BT has spent on the rights. Not to mention those that would consider going for the HD service with faster broadband thrown in.
Only time will tell how this plays out. But it looks like BT have pulled off both a fantastic marketing move but also a potentially very interesting business one. I for one may not be into football, however the tennis does interest me. And if we moved that would be a direct loss to Sky (broadband) and a win for BT.
P.S. BT if your listening the other half likes cycling and formula 1. Get either of those and I suspect I’ll be getting pressure to switch!