BSkyB puts squeeze on pay TV viewers with five per cent price rise

LONDON: BSkyB, the satellite television group, is set to put through its fourth successive inflation-busting price rise to customers. The increase - more than many analysts had predicted - may be seen as provocative by regulators at the European Commission.


Brussels is investigating the ?1bn that Sky has paid to renew its exclusive rights to screen English Premier League football. The Commission has suggested that the high cost of the deal may be harmful to consumers, who must subscribe to Sky to watch the games.

Sky has told customers that most will see a price rise of more than five per cent from next January. The cost of Sky World, the package taken by more than half the subscribers, will rise from ?38 to ?40 a month. The basic "family pack" will increase from ?18.50 to ?19.50 a month.

Previous years have seen most packages go up by no more than a ?1 a month. This time, some packages will rise by ?4.50 a month. Kingsley Wilson, an analyst at Investec Securities, said, "In the analogue era BSkyB was adept at increasing package prices by well above inflation up until 1998. During the switch over from analogue to digital, when BSkyB was vulnerable to customer churn (people leaving the service), the package increase policy was put on hold. With the majority of the base digital by January 2001 BSkyB resumed its pricing strategy."

The company has seven million subscribers, giving it a dominant position in the pay television market. Far from losing customers, the previous price increases have seen the churn rate fall. It now stands at a world-beating 9.4 per cent.

Wilson said the company could raise prices because it also improved its content each year. "What they do is actually give the customer hell of a lot more... for instance 102 Champions League games. On the rise, that just 2p a game," he said. Investec yesterday increases its forecast pre-tax profits by three per cent for this financial year (2003-4) to ?511m and by four per cent for the next fiscal year.

The broker added that, unlike previous price rises from which some subscribers were exempt, the increase this time would be across the board. Wilson said, "Price rises set for January 2004 further demonstrate BSkyB's ability to monetise its position not only on the revenue side, but increasingly on the cost front. We envisage no impact on churn."

A spokesman for Sky said, "We continue to make very significant investments, providing new programmes, new services and new channels." He said that, for the financial year ended June 2003, Sky had raised its spending on content by 11 per cent to ?1.6bn. The new football deal was an added programming cost.

Latest Reads
Star Sports unveils #BattleofSixes campaign for the upcoming PAYTM India- West Indies ODI and T20 series

This festive season is set to take cricket fans by storm as the battle of sixes begins with India taking on West Indies in the PAYTM ODI and T20 series, starting Oct 21st and November 4th, 2018 respectively.

Television TV Channels Sports
LaLiga Football Schools launch in Kerala

LaLiga, Spain’s top football league, recently launched the LaLiga Football Schools in India. It is a comprehensive grassroots football development programme in association with India On Track

Television TV Channels Sports
Triple gold medalist and former autralian olympic swimmer, stephanie rice debuts as an expert presenter on vivo pro kabaddi season vi in india

This season Star Sports, the official broadcaster for VIVO Pro Kabaddi League 2018 lifts the spirit of the game a notch higher with the announcement of three - time Olympic Gold medallist, Stephanie Rice, as an addition to the illustrious expert panel.

Television TV Channels Sports
IndiaCast rejigs revenue top brass in bid to grow across markets, platforms

In a move aimed at synergizing processes and business opportunities to scale up revenues, IndiaCast, the domestic, international and digital distribution arm of Viacom18 and TV18, today, announced an organizational rejig of its revenue management structure.

Television TV Channels People
Sun TV, Star Maa only non-Hindi GEC channels in across genre list

For the second consecutive week in a row, the Sun TV Network’s flagship Tamil GEC and Star India’s flagship Telugu GEC Star Maa were the only non-Hindi GEC channels in Broadcast Audience Research Council of India (BARC) weekly list of top 10 channels across genre.

Television TV Channels Viewership
Infotainment genre’s steady shift towards localisation

It’s home! That’s the cry that almost every broadcaster is uttering today when it comes to wooing viewers with content. Even as kids’, lifestyle and GECs are witnessing an uptake in local content, the infotainment genre isn’t going to be left behind.

Television TV Channels Specialised and Niche
Amazon most advertised brand in BARC week 41

The Broadcast Audience Research Council (BARC) India has released its data for last week’s top advertisers and brands between 6-12 October 2018. The data is a reflection of top 10 advertiser and brands across genre on Indian television (U+R) : 2+ Individuals.

Television TV Channels Viewership
No changes in Bhojpuri, Kannada, Marathi segments in BARC week 41

In the Bengali space, Jalsha Movies and Colors Bangla swapped their third and fourth positions in BARC data week 41. No changes were observed in the Bhojpuri, Kannada and Marathi segments. Moreover, Gemini TV and Zee Telugu swapped their second and third positions in the Telugu sector. Flowers TV...

Television TV Channels Viewership
Anil Ambani’s Reliance sues NDTV for Rs 10,000 cr

NDTV has been sued for Rs 10,000 crore by Anil Ambani's Reliance Group in an Ahmedabad court for its reportage on the Rafale fighter jet deal. The lawsuit is filed against NDTV's weekly show, Truth vs Hype, which aired on 29 September.

Television TV Channels News Broadcasting

Latest News

Load More

Sign up for our Newsletter

subscribe for latest stories