Sky, Viacom Extend U.K. Carriage Deal, Add Channel 5 to Ad Sales Pact

AP Images/Invision

The pay TV giant and the networks powerhouse, which acquired the British broadcast channel last year, reach a five-year arrangement.

Pan-European pay TV giant Sky and Viacom's Viacom International Media Networks unit said Friday that they have agreed to extend their carriage and advertising sales deal in the U.K. and Ireland for five years.

The arrangement keeps Viacom’s networks, including Comedy Central, MTV, Nickelodeon and VH1, in all Sky homes. The two companies will also extend their ad sales relationship and include U.K. broadcaster Channel 5 and its associated channels in it. Viacom acquired Channel 5 last year.

Sky's ad sales arm Sky Media has already been selling Viacom's 17 other networks and will now add Channel 5, 5 USA and 5* starting in June. Channel 5 previously had its own in-house ad sales team, which will be closed down. Some staffers are expected to get new roles at Channel 5, but the majority is expected to be made redundant.

Said David Lynn, president, VIMN U.K., Australia and Eastern Europe: "Sky is a highly-valued partner for Viacom and we’re delighted to extend our relationship for the benefit of our viewers and advertisers. We’re convinced Viacom’s interests are best served by a single point of advertising sales in the U.K. and Ireland and that Sky Media, with its strong track record of selling our pay TV channels and its innovative approach to improving the targeting and effectiveness of TV advertising, is best placed to provide it."

Sky CFO Andrew Griffith said: "The extension of our partnership with Viacom is great news for Sky customers as well as advertisers. The addition of Channel 5 will further strengthen Sky Media’s extensive channel portfolio. Advertisers will now have access to an even broader range of opportunities to reach customers using Sky Media’s creativity and innovation."

Sky Media represents all of Sky’s channels and web sites, as well as 26 other TV networks and networks groups, including Viacom, Discovery Communications, Fox and NBCUniversal. Sky Media said its portfolio of channels on average reaches almost 50 million people in the U.K. every week.

Sky last year acquired 21st Century Fox's pay TV platforms in Italy and Germany. Fox continues to own a 39 percent stake in the company.

Twitter: @georgszalai