Virgin Media And Sky Sign New TV Deal To Fend Off BT

Virgin Media and Sky have expanded their existing television carriage agreement to cover more high definition channels and to allow for more of the latter’s services to be added to Virgin’s online streaming service as the two companies defend themselves against the growing influence of BT on the TV market.

The agreement will see Sky Sports 3 HD, Sky Sports 4 HD, Sky Sports News HD, Sky Sports F1 HD and Sky News HD added to the Virgin Media TV platform, while a number of other Sky TV channels will be added to the Virgin TV Anywhere streaming service for iOS and Android.

In addition, all Sky Sports and Sky Movies channels will be made available to Virgin Media customers through dedicated mobile applications.

Mutual benefits

“We’re pleased to have extended our partnership with Virgin Media, which increases the reach of our content and reinforces our broadly-based approach to growth,” said Jeremy Darroch, chief executive of Sky. “This agreement builds on our long-standing relationship with Virgin Media, enabling us to deliver our great channels to even more homes across the UK and opening up additional sources of revenue.”

“We are excited our customers will be able to watch even more great TV from Sky on more devices as a result of the most extensive agreement ever signed between Virgin Media and Sky,” adds Tom Mockridge, Virgin Media’s chief executive officer.

The deal allows Sky to expand the reach of its TV channels and provides more content for Virgin to offer its customers at a time when BT’s expansion plans look increasingly threatening. The former state monopoly has spent billions on acquiring premium sports TV rights and offers its BT Sport channels for free to its broadband customers.

Rise of BT

BT is also enjoying considerable success in the superfast broadband market and it also reportedly plans to launch a mobile network in the near future. These actions have challenged Sky’s previous near-monopoly of the UK sports TV market and would challenge Virgin’s position as the country’s only provider of quad-play packages of landline, mobile, broadband TV services.

Sky in particular has felt threatened, especially as it doesn’t have a mobile network or its own fibre infrastructure. To remedy this, it has reportedly held talks with Vodafone to discuss a possible mobile partnership, while it is also building a fibre network with TalkTalk in York and could expand this model as both firms seek to reduce their dependency on BT’s Openreach network.

Sporting popularity

Sport is becoming an increasingly important weapon in the UK communications market and Virgin Media and Sky’s ability to offer the full Sky Sports range of channels is an advantage over BT, which only transmits Sky Sports 1 and 2 on its BT Vision service and is prevented from offering these on YouView. However BT says its investment in sport is resulting in a growing broadband base and increased quarterly revenues.

Streaming services such as Sky Go are also becoming increasingly popular, with sport a key driver. Virgin Media has revealed that viewing figures for Virgin TV Anywhere increased by 38 percent yesterday thanks to coverage of the last day of the Premier League season and that Sky Sports 1 and BT Sport 1 are often the most viewed channel on the service.

What do you know about Virgin Media?