BT Wins Rights to Air Champions League, Europa Leagues

(Corrects total amount in first paragraph of story published Nov. 9.)

BT Group Plc (BT/A), the biggest U.K. phone company, said its BT Sport channel will pay $1.4 billion for exclusive live broadcast rights for the UEFA Champions League and the UEFA Europa League soccer tournaments.

The rights run for three seasons from 2015-16, the London-based company said in a statement today. This is the first time a U.K. broadcaster has won exclusive rights to all matches for both tournaments, it said.

BT Sports will replace British Sky Broadcasting Group Plc (BSY)’s Sky Sports and ITV Plc (ITV) in broadcasting the 350 matches. BT will pay about 299 million pounds ($478 million) a season for the rights, a cost it said it can incur without changing its financial outlook.

“Both tournaments are world-class and firm favorites with many,” Gavin Patterson, chief executive of BT, said in today’s statement. “The live rights will give a major boost to BT Sport.”

The UEFA tournament spending is in addition to the 1 billion pounds BT had previously said it would spend over three years on rights for the BT Sport and ESPN channels it began broadcasting Aug. 1, said Dan Thomas, a spokesman for the company. More than 2 million customers have signed up for BT Sport and most were existing clients, Patterson told reporters on Oct. 31.

‘Armageddon Scenario’

The win by BT announced today is an “Armageddon scenario in sports rights,” according to Claire Enders, chief executive officer of Enders Analysis, a media researcher.

“We are already looking at a very distorted market for sports rights and it is going to get more distorted,” she said in a phone interview. “We are very concerned about how this will play out long term for all the players in the market that have to bear these very substantial costs.”

In a statement today, BSkyB said it bid for the rights to air the soccer tournaments “with a clear view” of what they were worth and that BT chose to pay far in excess of their valuation.

“Nothing changes until 2015 and we look forward to 18 more months of live Champions League on Sky Sports,” BSkyB said. “We will now re-deploy resources and continue to bring customers the best choice of TV across our offering.”

BSkyB spends about 2 billion pounds a year on content, with more than half on sports rights. Its first-quarter revenue beat estimates in October as it signed more broadband customers in the face of greater competition from BT.

Shares of BT rose 0.3 percent to 372.10 pence on Nov. 8.

To contact the reporter on this story: Ruth David in London at rdavid9@bloomberg.net

To contact the editor responsible for this story: Jacqueline Simmons at jackiem@bloomberg.net

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