Rui Vieira/AP
Sky’s comeback win of EPL comes as pay-TV firm shows strong signs of a financial turnaround and return to growth.
Spark may need to consider cutting the price of Spark Sport after losing the rights to show English Premier League matches from the end of this season, Jarden analyst Arie Dekker says.
Sky TV announced on Friday that it had secured the exclusive rights to the EPL for a full six years from the start of the next season in August.
That was after losing out to Spark Sport in 2018 at a time when doubts over the long-term viability of Sky’s pay-TV business model were near their peak.
Spark Sport head Jeff Latch said Spark was “naturally disappointed” about losing the rights to the EPL, but indicated its competition with Sky TV for sport rights was not over.
READ MORE:
* Sky secures English Premier League rights for next six years
* Spark Sport wins rights to Uefa Champions League and Europa League for three years
* Rugby World Cup 2019: Why Spark Sport may not get a second chance
Dekker said the EPL rights had dovetailed well for Spark with its cricket rights “through New Zealand’s core summer months”, and the loss could put downward pressure on its sports bundle, which is currently normally priced at $24.99 a month.
Spark declined to comment on that suggestion.
Sky’s shares were up 1.6 per cent at $2.52 during afternoon trading on the NZX on Friday after the announcement, in a generally declining market.
Spark’s success in securing the EPL rights back in 2018 signalled the beginning of a frenetic head-to-head battle between Spark and Sky for a spate of sports rights deals that were up for renegotiation.
Then Spark managing director Simon Moutter trumpeted its original EPL deal at the time by saying Spark was “setting out to transform the way sport is distributed and viewed” and aimed to be a key player in the evolving sports media landscape.
He voiced hope that Spark Sport could win over more than a million subscribers, but Spark has not subsequently broken out its viewers numbers or Spark Sport’s financials.
AFTERNOONS WITH JESSE MULLIGAN/RNZ
Sky TV has bought Spark’s video streaming service Lightbox, a deal first announced in December 2019. (Video first published February 2021).
Despite Spark’s subsequent success in securing domestic cricket rights in 2019, speculation has lingered over the depth of Spark’s long-term commitment to sustaining critical mass in the streaming sports market.
Speculation over Spark’s future intentions grew when – under the leadership of current chief executive Jolie Hodson – it offloaded its streaming entertainment service Lightbox to Sky in December 2019.
Sky TV drew a line in the sand in October 2019 when it dug deep to re-sign Super Rugby and All Blacks matches until 2025.
It has further stabilised its business over the past few months, with its shares rising in value by 50 per cent on the back of earnings upgrades, putting it in a better position to pay more for sports.
Dekker said it would be “a significant event” if Spark did stop chasing sports rights.
But he said that while Spark had been absorbing losses in media content for a long time and the EPL loss showed the challenges it faced, he could not “rule out” its ongoing interest in that market.
Spark’s Latch said on Friday that the nature of the business was that “we both win and lose content rights as they come to market”.
“Over the past few months we have secured a range of rights including extended NFL action, UFC, FIBA, the United Rugby Championship and Diamond League World Athletics,” he said.
“Our focus remains on delivering a great customer experience, growing our subscriber base, and identifying strategic partnership opportunities to further grow and scale our business.”
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Spark Sport head Jeff Latch hints it will have some good news for its football-fan subscribers soon, despite the EPL loss.
Latch noted Spark still had football rights, including for the UEFA Champions League, UEFA Europa League, and UEFA Conference league and said it had “some exciting announcements coming up in the next month, which we know football fanatics will love”.
“We have always said we will invest in content through the dual lens of customer desirability and commercial returns, and unfortunately in this instance what stacked up for us wasn’t the winning bid at the end of the day,” he said.
Sky chief executive Sophie Moloney suggested it was a win for sports fans to have more sports content in one place.
“Those of our Sky Sport customers who are fanatical football fans have had to purchase a second service to watch the Premier League in recent years, and it’s great to now be able to offer them the Premier League as part of their wide range of sport and entertainment viewing options on Sky,” she said.
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