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BSkyB CEO Talks BT Sports Competition, Retrans Fees

BSkyB CEO Jeremy Darroch Headshot - P 2012
Courtesy of BSkyB
BSkyB CEO Jeremy Darroch

Jeremy Darroch touts the company's relationships with HBO and Disney and says the Champions League European soccer tournament, which the firm is losing rights to, accounted only for 3 percent of its sports viewing.

LONDON – BSkyB CEO Jeremy Darroch on Wednesday shrugged off the threat of competition from U.K. telecom giant BT's sports networks, saying his company has always thrived among competition.

Speaking at the Morgan Stanley Technology, Media & Telecoms conference in Barcelona in a session that was webcast, he also touted the strength of the U.K. pay TV giant's movie offering and its Hollywood relationships and commented on British broadcasters' push to get retransmission payments that have become industry norm in the U.S.

Rupert Murdoch's 21st Century Fox owns a 39 percent stake in BSkyB.

Asked how BT's launch of sports networks this year and its aggressive bidding for sports rights has affected competition, Darroch said BSkyB's market has and always will be competitive. "It's evolved this year," he said. "Our job as a business is...to really stay focused on our plan."

He highlighted that BSkyB has in recent years "deliberately broadened our business," investing in content across genres and launching new services. That has doubled earnings per share, he said. "There is more growth" left for BSkyB, he concluded.

Asked about the recent loss of rights to European soccer tournament the Champions League to BT, which will kick in late in 2015, Darroch said the tournament accounts for only less than 3 percent of Sky Sports overall viewing. With rugby, cricket, tennis, Formula 1 and golf offerings in addition to soccer, Sky Sports is really "a broadly based sports proposition," he said.

Asked about the future of English Premiere League rights, most of which BSkyB has for the next three years with BT now also owning some games, Darroch said it was " a really important part of our sports offering."

But he said his firm will set its renewal bidding strategy only when the time comes, concluding that his team was "in good shape."

Sports is one key content offering for BSkyB, but entertainment is "a big opportunity for us," Darroch also told the investor conference on Wednesday. "All our entertainment channels are doing very well." The company has committed to boosting its spending on U.K. productions.

But Darroch also lauded BSkyB's "good" relationship with such Hollywood partners as HBO and Disney. Content owners look for the best partner that can provide their output the broadest reach, leaving BSkyB well positioned in the U.K., he said.

Asked about recent renewals of output deals with five of the big six Hollywood studios, Darroch said BSkyB's "movies business is doing really well." He added: "Movies is a big and important part of the business."

Asked about U.K. broadcaster ITV's and even some BBC representatives' recent push to get retrans fees from BSkyB, Darroch reiterated reservations about changing one part of the established system in the U.K. while not allowing other changes that could benefit BSkyB.

"We can't just dismantle one piece," he said without going into further detail on what he would like to see in return if retrans fees were to be required. "We are already doing a lot more with ITV and the other free to air broadcasters…[but] what's freely available is freely available."

E-mail: Georg.Szalai@THR.com
Twitter: @georgszalai