Sky's PL TV rights monopoly under EU threat

Adjust font size:

The European Commission wants to end BSkyB's monopoly over broadcasting Premier League football matches. The Brussels-based competition regulator wants other broadcasters too to get a share of the highly rewarding football broadcasts over TV.

EC's officials are understood to have informed the Premier League that starting 2007, when a new broadcasting deal will be in place, no one broadcaster should show more than half the live matches screened. EC is of the firm view that BSkyB's 13-year running of the show is bad for both consumers as well as rival broadcasters like NTL, Telewest and Setanta. A recent study by British regulator Ofcom showed that viewers and fans resented BSkyB's stranglehold and they wanted more choice.

BSkyB does not obviously like the proposal. It fears there will be substantial cut in its 7.8m viewers, who pay £40 a month. Premier League officials too feel the move may affect its £1.024bn income from TV rights. They claim the EU action is tantamount to "fixing the market" and may lead to broadcasters forming cartels to pay lower rates. This season, BSkyB is allowed to show 138 matches as agreed.

The Commission has been in talks with Premier League for the last 18 months and the League is understood to have come around to agreeing that at least one other broadcaster apart from BSkyB should be allowed to show some games from 2007, but it does not want to give the rights of half of the 138 matches to the second broadcaster. The League is afraid that if a competitor is given rights, BSkyB may pay far less than its agreed current three-year fee.

EC's competition commissioner Neelie Kroes is keen on a tough stand in this regard. A commission spokesman said it is frustrated with what the League officials are proposing and the commissioner will shortly send a letter explaining that she considers the proposals not acceptable and inviting them to come up with a more satisfactory solution at short notice.

The commission has in 2002 issued legal proceedings against the Premier League. However, there was a compromise in 2003 and the commission had insisted that in the years to come, there should be more broadcasters.

A spokesperson for the Premier League denied that talks had broken down, saying there was simply a hiatus as key people went on holiday. "Discussions are ongoing. We have been fully engaged in this process and will continue to be so." Meanwhile, a spokesperson for BSkyB said the company will be able to bid competitively for whatever rights are available.