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Darroch says Sky has ‘clear plan’ for Premier League rights as share price slides

Sky chief executive Jeremy Darroch has said that the UK pay-television broadcaster has a “clear plan” to accommodate the cost of its new English Premier League domestic live rights deal, as the company’s share price took a significant hit today (Wednesday).

The Premier League yesterday unveiled new domestic rights deals worth a total of £5.136bn (€6.9bn/$7.8bn) over the three seasons from 2016-17 to 2018-19. This represented a 70-per-cent increase on the £3.018bn the league earns in the current media rights cycle, 2013-14 to 2015-16, in which the value had also jumped by close to 70 per cent.

Sky defended its position as the league’s primary live broadcaster by acquiring five of the seven packages on offer, covering 126 of the 168 available matches. Rival BT Sport acquired the remaining two packages, covering 42 matches.

Sky will pay a heavy price for its dominance of Premier League live broadcasting, with its rights fee increasing by 83 per cent from £760m to £1.392bn per season. BT will pay 30 per cent more in the next cycle, with its fees increasing from £246m to £320m per season.

Sky’s share price on the London Stock Exchange slid by 40.5p to 913.5p by 10am this morning – a reduction of 4.25 per cent and the steepest decline since July. In the wake of yesterday’s announcement, Darroch said: “We went into the Premier League auction with a clear objective and are pleased to have secured the rights that we wanted. Our strong performance across the board gives us financial strength and flexibility. We have a clear plan to absorb the cost of the new Premier League deal while delivering our financial plans.”

By contrast, BT’s share price rose by 2.78 per cent by the same point this morning – increasing by 12.32p to 456.12p.

John Petter, BT Consumer chief executive, said: “I am pleased we will be showing Premier League football for a further three years and that we have secured the prime Saturday evening slot. BT Sport has got off to a strong start, reaching more than five million households and commercial premises, by making itself far more affordable and accessible to sports fans.”

The rival pay-television broadcasters both increased the number of live matches they will show under the new deals, as the league increased the number it made available from 154 to 168. Sky’s 126-match total is up from 116. BT’s 42-game total is up from 38.

Sky increased its share of the most valuable first pick matches. It will have 26 in the new cycle, up from 20 in the last cycle. BT got 12 first picks, down from 18. BT secured a more valuable timeslot this time, acquiring a package covering Saturday 5:30pm kick offs that are currently held by Sky. BT will lose the Saturday 12:45pm kick off slot it currently holds to Sky in the new cycle.

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