Premier League auction developments: more is less
BT and Sky’s content cross-wholesaling deal much reduces their risks of losing packages in the upcoming Premier League auction, with most of the strategic platform value of exclusive sports rights now wiped out.
The PL auction structure offers more games but less value, with the two smaller packages particularly unattractive, which cleverly nudges BT to retain a more expensive package, and thus most of its spending, if it wishes to downsize.
While demand from all potential rights buyers appears weak, paying less money to retain the same position will be challenging for the incumbents Sky and BT given high minimum package prices, with courage necessary to force these minimums to be reassessed
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Premier League: winner's curse
25 October 2017The Premier league (PL) will be hoping for another huge increase in rights payments in the upcoming auction for the three seasons starting 2019/20.
Aggressive competition between BT Sport and Sky has led to hyperinflation of most premium sports rights. Sport now accounts for two thirds of multichannel content spend, but only 8% of its viewing.
BT’s current financial position makes it difficult to justify expansion or further hyperinflation of its PL rights portfolio, but it cannot withdraw completely.
BT Q2 2017/18 results: Unresolved issues
10 November 2017BT Group revenue growth dipped to -1.5% from an instance of rare modest positive growth in the previous quarter, albeit mostly due to a predicted price timing effect in Consumer and revenue growth predictably going from bad to worse in Global Services
The bright spots were continued strong 4% revenue growth at EE, with an acceleration in mobile-related revenue also helping other divisions, and strong growth of 5% in external revenues at Openreach driven by accelerating fibre adoption by competitor customers
A number of very important regulatory/policy/legal issues remain unresolved, including 5G spectrum auction rules, leased line pricing, FTTC pricing and FTTP roll-out rules, but without a number of these going BT’s way the outlook remains tough for at least the next 18 months
Sky Q1 2017/18 results: Solid quarter, but challenges remain
16 October 2017Sky made a strong start to fiscal 2018, with improved customer net adds across each of its markets versus the previous quarter, as well as group revenue growth at 5%.
Operating profits switched back to growth, after the negative Premier League effect annualised out, with it now settled at the full cost of £1.4 billion per year. EBITDA growth hit 11%, or 15% excluding the effect of UK mobile and the Spanish OTT launch.
Against the backdrop of continued uncertainty around the UK advertising market, attention has turned to the upcoming Premier League auction, though we think it unlikely that digital players will cause disruption.
BT tightens grip on Champions League TV
16 March 2017The latest auction of UEFA Champions League televised UK rights has seen further high 32% inflation as BT renewed its ownership for the three seasons from 2018/19 for an annual payment of £394 million
Although BT annual payments are to increase by £95 million from 2018/19, the new contract offers added commercial attractions, though we expect BT’s efforts to monetise them will fall some way short of the cost increase
However, BT had to win to cement its position against Sky as a strong number two in UK premium pay TV and we expect weaker future inflation of premium football rights. For Sky followers, the focus is now on the UEFA auctions in Germany and Italy, where the outcome is far from certain
Premier League: winner's curse
25 October 2017The Premier league (PL) will be hoping for another huge increase in rights payments in the upcoming auction for the three seasons starting 2019/20.
Aggressive competition between BT Sport and Sky has led to hyperinflation of most premium sports rights. Sport now accounts for two thirds of multichannel content spend, but only 8% of its viewing.
BT’s current financial position makes it difficult to justify expansion or further hyperinflation of its PL rights portfolio, but it cannot withdraw completely.
BT Q2 2017/18 results: Unresolved issues
10 November 2017BT Group revenue growth dipped to -1.5% from an instance of rare modest positive growth in the previous quarter, albeit mostly due to a predicted price timing effect in Consumer and revenue growth predictably going from bad to worse in Global Services
The bright spots were continued strong 4% revenue growth at EE, with an acceleration in mobile-related revenue also helping other divisions, and strong growth of 5% in external revenues at Openreach driven by accelerating fibre adoption by competitor customers
A number of very important regulatory/policy/legal issues remain unresolved, including 5G spectrum auction rules, leased line pricing, FTTC pricing and FTTP roll-out rules, but without a number of these going BT’s way the outlook remains tough for at least the next 18 months
Sky Q1 2017/18 results: Solid quarter, but challenges remain
16 October 2017Sky made a strong start to fiscal 2018, with improved customer net adds across each of its markets versus the previous quarter, as well as group revenue growth at 5%.
Operating profits switched back to growth, after the negative Premier League effect annualised out, with it now settled at the full cost of £1.4 billion per year. EBITDA growth hit 11%, or 15% excluding the effect of UK mobile and the Spanish OTT launch.
Against the backdrop of continued uncertainty around the UK advertising market, attention has turned to the upcoming Premier League auction, though we think it unlikely that digital players will cause disruption.
BT tightens grip on Champions League TV
16 March 2017The latest auction of UEFA Champions League televised UK rights has seen further high 32% inflation as BT renewed its ownership for the three seasons from 2018/19 for an annual payment of £394 million
Although BT annual payments are to increase by £95 million from 2018/19, the new contract offers added commercial attractions, though we expect BT’s efforts to monetise them will fall some way short of the cost increase
However, BT had to win to cement its position against Sky as a strong number two in UK premium pay TV and we expect weaker future inflation of premium football rights. For Sky followers, the focus is now on the UEFA auctions in Germany and Italy, where the outcome is far from certain