ESPN licks its wounds and exits UK with BT Vision sale

TV camera

By Paul Nicholson
February 26 – US broadcaster ESPN’s long awaited arrival into the UK television market was launched on the back of Premier League football rights. Its exit from the market, confirmed yesterday, comes following the loss of those same Premier League rights – such is the make-or-break power of the English league in the pay TV market.  

BT Group, whose TV arm BT Vision beat ESPN to the rights for a Premier League TV package starting next season, has agreed to buy the UK channel business from the Disney-owned sportscaster for an amount reported to be in the “low tens of millions”.

BT will keep one channel branded ESPN channel which will likely be for its American sports output, though it is understood there will be no on-going fee paid for the use of the brand name.

The deal means BT will expand their football portfolio gaining the broadcast rights to the FA Cup, Scottish Premier League, Bundesliga, and Europa League. The company already has the rights to 38 live Premier League matches per season from 2013/14 for three seasons.

Other sports, like Aviva Premiership Rugby and live women’s tennis, will go on to a third BT Vision channel. ESPN subscribers will continue to receive their usual service until the purchase has been completed – expected mid-July in advance of the new Premier League season in August.

While ESPN was never able to challenge Sky effectively in the UK pay TV market, BT Vision, with the power of the telecommunications giant behind it, is a different kind of competitor altogether.

Set up in the state-of-the-art digital media centre in Stratford by Olympic Park, BT Sport will certainly have the marketing and financial muscle to become a credible alternative to the Murdoch-controlled Sky that has built its dominant position on Premier League football.

Last year’s auction of Premier League rights in the UK raised £3bn but ESPN match-less, with no rights to broadcast Premier League games. ESPN reportedly was not willing to join the bidding at the higher levels once it felt that the rights fees had peaked beyond their market value.

The £3 billion figure is 70% more than the previous three-year deal, with BSkyB agreeing to pay £2.28 billion for 116 games per season from 2013-14 to 2015-16 and BT paying £736 million for the rights to 38 games per season over the three-year period.

ESPN has about 700,000 subscribers which is seen as a good kick start for the BT service. ESPN Classic will be run down and turned off.

Marc Watson, chief executive of television, BT Retail, said: “We are delighted to have reached agreement with ESPN for the acquisition of their UK channels business and that we have been able to add some exciting new sports rights to the ones we already have.

“The FA Cup, Scottish Premier League and Europa League rights will allow us to offer customers of BT Sport even more quality live football, including our first games from the Scottish top flight and our first European competition rights. There will also be the best of US sports available courtesy of this deal, which will further broaden the appeal of BT Sport.”

Ross Hair, managing director, ESPN – Europe, Middle East and Africa, said: “We could not be more proud of the TV channels built and nurtured by our talented team over the past four years. The value of that hard work is reflected in this deal with BT and the continuation of ESPN on television screens across the UK and Ireland. The same passion, commitment and innovation will be at the heart of how we develop our strong digital media business into the future.”

ESPN will maintain its digital sports media business, as well as its London-based TV sports sales team. Both accepted market leaders in their areas.

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