By Kate Holton and Stephen Addison
LONDON Nov 9 Britain's BT has beaten
BSkyB to win the right to show Champions League soccer
from 2015, in the biggest blow to Rupert Murdoch's dominant
pay-TV operator since it started broadcasting more than 20 years
BT, the 168-year-old former state telecoms monopoly, said it
would pay 299 million pounds ($478 million) a season to add the
glamour ties of Barcelona versus Manchester United and Real
Madrid versus Bayern Munich to the English Premier League
matches it already shows.
The deal means BT will replace BSkyB and Britain's biggest
free-to-air commercial channel, ITV, as the sole
provider of Champions League matches on Tuesday and Wednesday
nights. BT will also show the UEFA Europa League for three
years, Europe's second-tier soccer competition.
"The live rights will give a major boost to BT Sport and
give people yet another reason to take our terrific service,"
Gavin Patterson, BT chief executive since September, said. "BT
Sport has got off to a strong start with customers enjoying what
we have to offer."
BT, which said it would show a selection of the matches for
free, said the contract would not affect its financial targets.
The group, which had spent years slashing costs after two
major profit warnings in 2008 and 2009, stunned the sporting
world in 2012 when it won the rights to show 38 live Premier
League matches a season.
While the new entrant to the market remained a minnow in
comparison to BSkyB and its 116 games, the move was an early
indication of how BT was willing to spend big to protect its
core broadband and fibre services by combining it with an offer
of high-quality sports programming.
With annual revenues of more than 18 billion pounds, BT was
also in a completely different league to the two previous groups
that had tried to challenge BSkyB in the British home
entertainment market - Ireland's Setanta and ESPN.
When BT announced in May that it would offer the sports
service free to its broadband customers, it sent shares in BSkyB
tumbling as investors questioned the long-term impact on a group
that had built its business around sports and movie programming
to broadcast in more than 10 million homes.
BLOW TO BSKYB
The three-year, 900 million pound deal signed by BT is worth
more than double the 400 million pounds BSkyB and ITV agreed to
pay for the current three-year contract back in 2011.
"We bid with a clear view of what the rights are worth to
us," a spokesman for BSkyB said. "It seems BT chose to pay far
in excess of our valuation."
BSkyB, 39-percent owned by Rupert Murdoch's 20th Century Fox
, first won the rights to show Europe's premier
competition in 2002 and has flourished as the Champions League
and English Premier League grew in popularity.
In the current three-year contract BSkyB had the right to
show seven live matches on Tuesday nights and eight live matches
on Wednesday night, while ITV showed one live match on Tuesday
evenings, invariably featuring one of the English teams.
The loss of the games from the 2015/16 season will leave a
huge hole in Sky's programming schedule and will likely put
pressure on the group to agree a wholesale deal with BT so it
can still show the matches to its subscribers.
Alternatively, Sky subscribers could take pay-TV channels
from Sky but take their broadband from BT in order to access all
the live sport.
BSkyB is thought to have around 5 million subscribers to its
sports channels, while BT said in October it had more than 2
million homes signed up to its new sports service. It is present
in 4 million homes due to a wholesale deal with cable operator
"Despite these payments, BT's financial outlook is
unchanged," it said. "The rights are expected to drive
additional growth in BT consumer revenue and profits over the
The extra money paid by BT could be used by UEFA to boost
the prize money of both competitions, including the secondary