Telecommunications company BT’s spending power in the auction for the next cycle of rights for football’s English Premier League could be restricted by proposals put forward by Ofcom, the UK media regulator.
According to the Daily Telegraph newspaper, Ofcom will include the cost of BT Sport, which the company gives away to its broadband subscribers, when it performs a ‘margin squeeze’ test of whether the telco’s rivals are able to make a profit in the internet market.
As part of the test, Ofcom will take into account BT’s expenditure on sports rights, broadcasting and production for its BT Sport pay-television channels. The TalkTalk telco and media company BSkyB have not built their own copper and fibre lines and rely on BT's connection network to sell their broadband services.
“There is strong competition in the UK broadband market and we are confident our pricing will pass any regulatory test that may be put in place,” a BT spokesman said.
A TalkTalk spokesman added: “We’re really pleased that Ofcom proposes to start regulating fibre more effectively. We have long maintained that the time has come for fibre to be more robustly regulated, starting with a margin squeeze test. What matters most is ensuring a level playing field and competition for fibre in the future.”
A BSkyB spokesman said: “Ofcom’s new rules are a significant step towards ensuring more effective competition in superfast broadband. We want the market to be as competitive as standard broadband so that customers can enjoy better choice and value.”