BT has "escalated an increasingly bitter war with arch-rival Sky with a call for greater regulatory intervention to cut prices and open up competition in the broadcaster’s core pay-TV market," according to Thomas & Mance of the FINANCIAL TIMES.
BT has asked Ofcom "to change the scope of a review into digital communications to include pay-TV, accusing Sky of using its dominance in sports and entertainment TV in Britain to charge higher prices for consumers than elsewhere in Europe."
BT claims that Sky customers are paying about £500M ($776M) more per year for even the basic packages of pay-TV channels. BT Consumer Division CEO John Petter: "Whereas in the energy market regulators have criticised the big six operators, in pay-TV Sky has a 65 percent share, so there is really only the big one." The battle between BT and Sky "has intensified as BT has emerged as a TV broadcaster and Sky as a competitor in broadband."
BT’s unexpected acquisition of some of the U.K.’s top sports rights "was initially a defence of its core broadband market against Sky’s aggressive push to sign up internet customers."
However, BT’s decision to start charging for Champions League games, and bolstering its entertainment output with the exclusive rights to the AMC channel, "is seen by analysts as a more direct push to develop a TV business."
A Sky spokesperson said that it was "strange to hear BT talk about high prices when they are about to increase the price of BT Sport for Sky TV customers by 48 per cent" (FT, 7/9).
