Jan 26, 2017
Sky profits hit by high price of Premier League football
Sky suffered a 9 per cent drop in operating profits in the last six months as it paid the price for the steep inflation in live football rights. The European pay-TV broadcaster, which is subject to an £11.7bn approach from Rupert Murdoch's 21st Century Fox for the 61 per cent of the company it does not already own, paid £4.2bn for the latest three year deal to show live Premier League football - a 70 per cent jump on the last deal. With the next round of Uefa Champions League rights about to go to auction, Fox's move to seize full control of Sky may give the broadcaster more firepower to win back the rights from rival BT, who issued a profit warning this week due to a deepening of an accounting scandal in its Italian business. Mr Darroch said any bid for live European football, which BT paid £900m for in 2013, would not be influenced by the Fox bid or the situation at BT. Analysts noted that Sky's rate of churn - the percentage of subscribers leaving Sky - was up to 11.6 per cent compared to 10.2 per cent for the same six months in 2015. Sky also hit back at Discovery after the John Malone owned broadcaster threatened to pull its channels from Sky by the end of the month unless it agreed to pay "a fair price" for carrying them.
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