Subscription model seen as best bet over long term, while analysts say Sky may load rival with poor content News Corporation is to put another of its services behind a paywall as it emerged yesterday that Sky Sports News is to be pulled from Freeview. BSkyB, which launched Sky Sports News on Freeview in 2002 with Sky News and Sky Travel, is to replace the channel with a one-hour timeshifted Sky 3+1 service later this year. Sky 3 replaced Sky Travel in 2005. Industry experts also believe that BSkyB could decide that its Sky News website, currently freely available on the internet, should go behind a paywall. The decision on Sky Sports News, which has an average daily reach of 2.1m according to television measuring service Barb, marks a significant shift in BSkyB’s attitude to the benefits of using the reach of the free-to-air service as a marketing channel to attract subscribers to its pay-TV service. With subscription charges about to start on the Times’s website as Rupert Murdoch’s media empire searches for new revenue streams, News Corp is undergoing a major restructuring of its business model. It is already looking to maximise revenues from its Sky TV channels by launching a bid for the 61% of the satellite broadcaster that it does not presently own. Despite the Sky Sports News service benefiting from advertising revenues on the Freeview platform, it is thought that BSkyB has decided that over the long term there is more advantage to be had from a subscription model. As part of the move, BSkyB is to boost editorial investment in Sky Sports News as it prepares to launch a high-definition service. When the service is removed from digital terrestrial service Freeview, it will be available on subscription services Sky, Virgin Media and TalkTalk TV. “As part of a subscription service, customers can look forward to expanded coverage and the launch of Europe’s first HD sports news service,” said Barney Francis, the managing director of Sky Sports. BSkyB is seeking to pull valuable free content and boost the “must have” factor of its pay services ahead of rivals introducing cut-price Sky Sports packages for the next Premier League season. In April Sky was ordered to slash the price it offers Sky Sports 1 and 2 wholesale to rivals including Virgin Media and BT Vision . Alexander Wisch, an analyst at Standard & Poor’s Equity Research, said: “In my view if they are forced to sell key content, like sport, at regulated wholesale prices, why give out anything for free? “Its pay TV platform may be under threat from the wholesale issue so if anyone can soon offer Sky Sports [at highly competitive prices] then BSkyB will be asking what they can offer as added value to subscribers. They are looking to make the pay TV service more interesting, the destination for sport.” Wisch also believed that it was unlikely but not out of the question for BSkyB to be considering the long-term strategy of keeping Sky News on Freeview. “I wouldn’t be surprised if they pull other content out [of free platforms],” he said. “Sky News is important to them on Freeview, so far, and while I can’t see it coming off in the near term, I wouldn’t rule anything out.” BSkyB is expected to reach its highly publicised 10 million subscriber target this year. The weakening of Freeview would help shore up the pay-TV company’s longer-term position. Replacing Sky Sports News with a time-shifted version of Sky 3 was described by one former senior Sky executive as “a cheap way to fill airtime with relatively pointless TV”. BSkyB will pick up a fourth slot on Freeview when it takes over the Virgin 1 channel, assuming regulatory clearance is given to its £160m takeover of Virgin Media Television’s channels . BSkyB did not buy the licence to continue operating the Virgin 1 name. “Freeview delivers some advertising revenues for them, but is a potent rival for the pay TV platform, so they do benefit from a weaker Freeview, with a poorer content offering,” said one industry source. “Full conspiracy theory could see Sky put crap on the channel to make the inferior Freeview offering more so. Make a rival suffer, that is the pay TV way.” BSkyB Freeview Television industry Media business BSkyB Mark Sweney guardian.co.uk
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Sky Sports News to go behind paywall in battle with Freeview broadcasters
