BT is hiring more terrestrial capacity to help back up its IPTV platform. It’s part of a gamble that the regulatory environment will finally go its way, writes Julian Clover.
There is a small game of chicken currently being played in UK pay-TV. Or maybe it is more akin to Russian roulette that Virgin Media and BT Vision are both planning to launch pay-TV offerings based around their newly granted access to Sky Sports.
In the case of Virgin it is the HD versions of Sky Sports 1 and 2 that will shortly be available, while BT is planning to add the standard definition versions for the first time, following the regulatory intervention of the Competition Appeal Tribunal. Both operators are betting that the result of Sky’s appeal over the wholesaling of its premium channels will go in their favour. Under the proposal agreed between CAT, Ofcom and Sky the difference between Ofcom’s regulated wholesale fees and Sky’s own proposals will be held in trust until a final decision is made. At this stage, and even with a change of government, it would seem unlikely the pay-TV platforms would end up withdrawing the channels.
But in order to deliver Sky Sports to its IPTV network customers BT is leasing capacity on the terrestrial system from Arqiva. Along the way BT is exposing the inadequacies of its network and its current inability to transmit linear channels. This might well change as BT implements plans to upgrade its network to enable it to move away from the top-heavy nature of its programming proposition. VOD, now premium sports, with the remainder of the channels being what much of the country can pick up with a standard TV offer. It would follow that the two channels also find their way into the Top Up TV package.
The last time Sky Sports was available terrestrially was some ten years ago as part of ITV Digital. The failure of the pay package led to the creation of Freeview, though the involvement of Top Up and ESPN means that terrestrial still accounts for about 600,000 homes. Might BT’s gamble push this figure higher?
In the days of ITV Digital and the disastrous purchase of Football League rights someone calculated that the number of subscribers being so low it might have been cheaper to fly fans to the individual matches rather than go to the expense of setting up a transmission system. Time will tell if the planes will need to be scrambled.