In the day since BT announced that BT Sport was to be the exclusive home to live coverage of the UEFA Champions League and UEFA Europa League for three seasons starting in 2015 there has been a very mixed reaction from people.
For those for whom a football match at prime time on a free to air channel is an annoyance there may be some relief mixed with astonishment at how much the rights cost, for those who are BT customers already and avid football fans they may be feeling pleased and for other football fans the question will be what will the cost be in two years to add these matches to monthly subscriptions.
BT Sport in winning the rights to these 350 EUFA Champions League and UEFA Europa League outbid ITV and BSkyB, and given the price tag of €1,075,981,484 that BT will have paid for three seasons rights it is easy to see why ITV has fell by the wayside. ITV may be saying BT has paid over the odds, but given that free to air transmissions only revenue source is advertising even if BT Sport was not in the running it was most likely that Sky Sports would have won.
The questions have been asked over whether BT was right to bid the amounts it did for previous sports rights, and this large sum will raise the topic once more. The steady increase in the price of basics like telephone line rental and caller ID are seen by many as helping to pay for the sports rights, though it has to be observed that other telephone providers have been doing the same for years and they do not buy sports rights.
The rise of multi-channel TV in the UK was originally driven by Sky and sports broadcasting, and it seems the same is now happening with broadband which if the predictions are correct will result in less material broadcast over expensive satellite air-time. The rise of multi-cast technology in the router hardware and IP based networks is making the broadcast of live TV feasible and with the UK Government investment the coverage of superfast broadband should hit the 98% coverage figure around 2018, and 98% is the accepted household footprint for those able to receive a Sky TV service.
For those who say there is no money in sports broadcasting, consider NOW TV Sports passes at £9.99 for a days viewing, Sky would not be maintaining that price if the passes were not selling. BT Broadband customers worried this new rights acquisition will cost them in the longer term need to remember that BT will make money from selling BT Sport to operators like Virgin Media and those that are not BT customers but who want to view the content on the Sky satellite platform.
Moving into the content arena is a logical move for a large telephone/broadband operator particularly when regulated so tightly. So while BT can be criticised for spending this money on content rather than network investment, given that no other operator is improving its physical network to the same scale there is little worry of being overtaken in that respect. The worries are from the ARPU in the retail sector and being left as someone providing fairly dumb but fast connectivity with very low payback periods. Sports rights may be a gamble, but the ROI in terms of subscriptions to watch content, retaining customers or signing up new ones is likely to see a faster return.
If there was a criticism to be made of BT Sport, it that the wide range of platforms available to watch content for free or via subscription can be very confusing.
For the overall UK broadband picture, if the sports increase popularity of IPTV and the demand for super fast services then it has to be a good thing.