LONDON, June 10 Britain's BSkyB is
launching a sports channel dedicated to European football, and
is throwing in two years of free broadband, in a fresh assault
on BT before its rival starts showing the flagship
Champion's League next year.
The channel, which will be free to subscribers, brings
together Sky's European football assets, including European
qualifiers, Champions League and Spanish football, and adds
Dutch live football.
While not offering much new content, analysts said Sky would
use the new channel to sign up subscribers to its latest
broadband promotion, which it said was its best to date.
Shares in BT were trading down 2.6 percent at 395.7 pence by
1114 GMT, the biggest faller in the FTSE 100, while
BSkyB was down 1.2 percent at 865.5 pence.
Analysts at Berenberg said they did not see the channel as a
driver of customer growth or upgrades, but they regarded the
aggressive broadband offering as confirmation that Sky was
upping the ante against a resurgent BT.
"In our view, the plan for 'Sky Europe' indicates that
management, even if not admitting it publicly, understands the
UK business is under pressure," they said.
Berenberg have a "sell" rating on Sky shares.
BT has moved aggressively into sports programming to bolster
its broadband services, starting by buying a package of English
soccer Premier League rights in 2012, and later winning an
auction to show all UEFA Champions League matches for three
seasons from August 2015.
Mike van Dulken, head of research at Accendo Markets, said
Sky's new channel was a shot across the bows for BT, whose
shares have outperformed its rival's since last November's win
of the exclusive Champions League rights.
"While the news might benefit Sky subscriber figures for the
upcoming 2014/15 season, will free broadband for the next be
enough for those footy-mad Sky punters facing the prospect of no
Champions league for 2015/16?," he said.
(Reporting by Paul Sandle; editing by Tom Pfeiffer)