BSkyB Drops as U.K. Competitor BT Group Unveils Sports Channels
British Sky Broadcasting Group Plc (BSY), the U.K.’s largest pay-TV broadcaster, fell the most in almost a year after BT Group Plc (BT/A) unveiled sports channels to compete with the Rupert Murdoch-controlled satellite operator.
BT Sport will be free for BT broadband subscribers and will be offered to pubs and clubs at a price about 80 percent cheaper than BSkyB’s service, the company said. It will start in August and has recruited presenters including the BBC’s Clare Balding and former English national rugby team captain Lawrence Dallaglio.
“BSkyB shares are going to get murdered and will have a significant weakness not only today but in the weeks and months to come,” said Alex DeGroote, a media analyst at Panmure Gordon & Co. in London.
BSkyB shares fell as much as 6.6 percent to 805.5 pence in London, the biggest intraday drop since June 2012. TalkTalk (TALK) Telecom Group Plc, the U.K. broadband provider split off from Carphone Warehouse Group Plc, dropped as much as 14 percent.
Though BSkyB is the market leader for pay-TV in the U.K., BT is a large rival that will use BT Sport and sporting rights it bought in recent months to sell more broadband, competing with BSkyB as well as cable company Virgin Media Inc. to offer bundles of Internet, telecommunications and television services.
“BT and Virgin Media are not Mickey Mouse little operators coming from left field,” DeGroote said. “People may be turning away from Sky for the first time in ages.”
BSkyB was down 4.7 percent at 821.5 pence as of 1:35 p.m. TalkTalk was down 8.8 percent at 230.4 pence and BT declined 2.1 percent to 276.3 pence.
To contact the reporter on this story: Kristen Schweizer in London at email@example.com.