LONDON: Limited demand for BT's ad space package for its new UK sports TV channels has forced the telecoms giant to rethink its offer to media-buyers in its battle with Sky, currently the largest pay-TV broadcaster in the UK.
BT launched its sports channels at the beginning of August in a challenge to Sky's 20-year dominance of TV sport, but advertisers have not responded positively to being locked into deals lasting as long as ten months despite BT's advertising rates being up to 20% cheaper than those of its satellite rival.
BT sought to tie in advertisers across all its sports offerings, as opposed to Sky which allows advertisers more flexibility about the games they wish to be associated with, and unenthusiastic demand meant BT has been forced to offer shorter deals, the Financial Times reported.
However, the company has stated that it has so far exceeded internal revenue targets, buoyed by better-than-expected initial viewing figures and larger numbers of younger viewers, who command a premium with advertisers.
Some 764,000 viewers tuned in to the first live Premier League football match broadcast by BT, a figure that compared favourably with its rivals.
The company spent £738m over three years for the rights to 38 Premier League football matches and, over the past year, has also bought up the rights to Premiership Rugby and a host of other sports. It has also acquired the UK TV businesses of Disney-owned ESPN.
In addition, it concluded a deal with Virgin Media to make its new sports channels available to Virgin's customers, which analysts at Barclays estimated could generate £75m a year.
It signed up a range of brands for its launch earlier this month, including Barclays, Microsoft, KFC and Carling, and media-buyers said BT's pre-launch marketing helped to draw in advertisers.
Data sourced from Financial Times; additional content by Warc staff