The battle between BT Vision and Sky for the lucrative pub market is intensifying. This will be welcome news to pub landlords who feel that they have been overcharged by Sky. The pub trade has never really recovered from the smoking ban and many pubs have closed.
The battle between BT Vision and Sky for the lucrative pub market is intensifying. This will be welcome news to pub landlords who feel that they have been overcharged by Sky. The pub trade has never really recovered from the smoking ban and many pubs have closed.
The Financial Times reported yesterday that Sky has already offered some large pub groups heavy discounts of up to 30 per cent. This is the first time in two decades that the leading football broadcaster has been willing to give substantial discounts. The head of one pub chain made the following comment on Sky to the Pink ‘Un: ‘They have been fierecely arrogant up to now.’
But note that it has been given to the big chains. It is independent tenanted landlords who have been hit hard by charges, although many of them have tried to find ways round them, leading to one famous legal case.
Pub and club subscriptions account for between £200m and £300m of BSkyB’s annual revenues and in many respects that can be regarded as straight profit as the fixed costs have already been met. Sarah Simon, media analyst at Berenberg told the FT: ‘This is a very vulnerable profit stream because the revenues are so high margin. Pubs will leap at some competition from BT because Sky increases the price so aggressively every year.’
BT estimates that about a fifth of pubs do not show any sport, but this may be because their clientele like it that way rather than because they cannot afford it. A sports channel blaring away hardly fits with the ambience of a Middle England gastropub, of which there are many (effectively many of these are restaurants with a token bar for locals).
Probably the better market for BT is the half of pubs which only show free sport on terrestial television. It may be able to interest them given its cheaper packages. About one third of pubs show Sky Sports.