BSkyB signs a £200m ad sales deal with Discovery

BSkyB and Discovery have signed a new four-year ad sales deal worth more than £200 million, ending a year-long legal dispute that was due at the High Court next month.

The deal finally concludes the companys’ legal battle over the terms of the existing contract, which threatened Sky’s position to be able to negotiate ad deals for 2010.

Discovery claimed that a clause in the existing deal, which expires at the end of the year, meant it was entitled to additional revenue if its channels hit certain viewing targets.  The company argued that it was owed multi-millions of pounds as a result.

However, BSkyB and Discovery have now reached a new ad-deal in its place, which will start in January.  The deal has been agreed just in time to strengthen Sky’s position ahead of the trading season between TV companies and agencies for 2010 ad deals.

BSkyB will become the sole airtime sales agent across Discovery’s 13 channels, which include Discovery Travel and Living, Animal Planet and DMAX, under the £50 million-a-year deal.

Discovery’s premium channels account for more than 15% of the TV advertising airtime that Sky Media offers to advertisers, which is why the new partnership is critical for the Murdoch-owned company.

Richard Hawking, operations director at Sky’s ad sales arm, said: “Discovery has played an important part in the growth of pay-TV in the UK and of Sky Media as a TV sales house.  We are delighted to be able to continue working together and look forward to building upon an already strong relationship.”

Chris Shaw, senior vice president of Discovery’s commercial development for UK and Europe, Middle East and Africa, added: “Sky Media has been our ad sales partner since 2002.  We look forward to growing the UK business with their support under the new contract and continuing our long and productive relationship.”