BT, Sky bury hatchet with deal to sell each other's telly channels
Intended to boost former state monopoly's 'ailing TV service'
BT and Sky have set aside their long-running feud and signed a deal to sell their channels on each other's platforms in the UK.
Under the deal, BT will supply its sports channels, which show UEFA Champions League and Premier League football, to Sky. In return BT will be able to sell Sky's Now TV service, which includes Sky Sports, Sky Cinema and the Sky Atlantic channel, to its customers.
BT has splashed ￡3.5bn on Champions League and Premier League football since 2012 in its bidding war against Sky.
Paolo Pescatore, senior veep of multiplay and media at CCS Insight, said the deal means more to BT, "giving its ailing TV service which has been struggling to see meaningful net adds over recent quarter." He said the move is intended to make BT TV more attractive to consumers.
"All eyes will now be on the Premier League and whatever the outcome both BT and Sky will be in a strong position to air all the Premier League matches on their respective platforms. Arguably the biggest losers in this tie-up are TalkTalk and Virgin Media."
BT has previously been accused of prioritising its investment in TV content over broadband infrastructure, with some suggesting the former state monopoly had used Openreach as a cash cow – which BT has denied.
On Thursday, Disney announced a deal to buy a large chunk of 21st Century Fox, including its 39 per cent stake in Sky.
Gavin Patterson, chief executive of BT, said: "This is the next logical step for our TV and content strategy. Having built up an outstanding portfolio of exclusive sports rights and a loyal base of customers, we feel that now is the right time to broaden the ways in which we distribute BT Sport.
"This agreement fits with our strategic goal of being the best provider in the UK of converged network services, and adding NOW TV boosts our growing roster of outstanding content from the likes of Netflix, great pay channels like AMC and all the major catch-up services." ?