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Broadband giants' expensive battle
Paul Callanan's article on football financing (issue 834) was illuminating. The almost complete dominance of big business (often from very shady business people) is only part of the problem. There is currently a battle between Sky TV and BT Sport for live broadcasting rights which has led to a hyper-inflationary spiral in the cost of broadcasting rights. This flows through to the cost of tickets for matches.
British Telecom (BT) didn't enter the TV market to provide sport for the public; it was a means of stemming loss of broadband customers to Sky who could offer both TV and broadband. Although BT Sport is free to their broadband customers some City opinion doubts whether this is sustainable permanently.
The test may come soon, when they start paying for the Champions League rights. BT has just increased line rentals by 6% so it looks like they are trying to partially recoup the cost from their general customer base.
The Pay TV market is becoming chaotic. A choice of providers offers broadly similar packages and there are regular complaints to regulator Ofcom about anti-competitive behaviour. Most customers couldn't care who provides their TV as long as they get what they want to watch. But the competitive element pitches BT workers against Sky workers against Virgin Media workers.
Chaos in the modern telecoms market and the drive for profitable revenue stream partly reflects the ever-increasing cost of investing in the latest technology. Capital is spread among too many companies.
This is driving a new wave of consolidation as witnessed by BT being in talks with both O2 and EE regarding a possible purchase. Both TV and telecoms industries are crying out for public ownership and planning, not on a national but an international scale.
A British Telecom worker
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