BSkyB to offer broadband cuts ahead of BT Sport offering

BskyB is set to issue broadband price cuts in response to BT’s recent sports offering, according to a report in the Telegraph.

BT recently announced that it will be offering BT Sport to all broadband consumers, making weekly live matches from the Barclays Premier League free for the first time in over 20 years.

According to sources, a statement from BSkyB will be issued early this week concerning the company’s internet and television bundles, and is said to be a “market changer”.

Peter Oliver, commercial director for BT Consumer, told the Telegraph: “We think Sky customers are grossly overcharged and welcome any cuts they make to their package.

“Many sports fans have broadband through us and their TV through Sky,” he said. “Our channels will be free for those households, so we’d be happy seeing their monthly bills reduced by Sky.”

BSkyB currently charges £617.50 each year for access to its full list of sports channels, while BT offers an equivalent deal for £261 to watch the channels via a laptop, and an extra £110 per year for a set-top box.

Enders Analysis previously said that the launch of BT Sport was not a ‘game changer’; instead claiming that the ‘main damage to Sky’ would come from elevated rights costs, and risk of further inflation when it comes to the next major renewal of the rights in three years’ time.

However, Bank of America Merrill Lynch (BoAML) has said that BSkyB’s performance “could be a lot worse than you think” in a recent financial forecast, rating the business as “under-performing” as BT and TalkTalk offer cheaper and more competitive TV offerings.

In the bank’s view, many people will now take TV from BT largely because the business offers sport, fibre-optic broadband, a PVR, a choice of catch up, extra channels and programme scrollback at a lower price. A similar view is held for TalkTalk.

“While BT’s sports offering lacks the depth and breadth of that of Sky, Sky Sports customers have the opportunity to save at least £370 a year,” said BoAML analyst Daniel Kerven. “This is unlikely to appeal to core sports fans but could be of interest to more marginal sports customers.”

Sky declined to comment on the Telegraph article pending the announcement, however the company stressed that it would show three times as many Premier League games next season as BT Sport.