Can Warner Bros Discovery and BT Sport’s joint venture knock Sky off its perch?
Sky’s premium entertainment, films and sports offering has previously been unrivaled in the UK, but it could be about to find its match in the combined powers of Warner Bros Discovery and BT Sport.
Warner Bros Discovery and BT Sports joint venture
Yesterday (September 1), Warner Bros Discovery and BT Sport finalized a 50/50 joint venture that combines BT Sport with Eurosport UK. The two brands will initially remain separate, but plans are underway to launch a new sports entity. As yet unnamed, it will have the rights to the Olympic Games, the Premier League, Uefa Champions League, Premiership Rugby, MotoGP, UFC, Boxing, WWE and the tennis Grand Slams.
“It’s important for fans to know they can continue to enjoy BT Sport and Eurosport UK as they do today and we’ll keep them updated on future plans as soon as we can,” said Andrew Georgiou, board member of the joint venture and president and managing director of Warner Bros Discovery Sports Europe.
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The partnership is rival only to Sky in the UK market, which also has Premier League and Uefa rights along with Rugby Union, English cricket, the US Open, darts and World Cup fixtures. Saul Walkinshaw, the investment performance director at Havas Media Group, says it is “debatable” how worried Sky should be about the news. “But looking further down the line, it would seem foolhardy not to take it seriously.”
According to Walkinshaw, Sky’s biggest threat from the new venture will be more than just sport. “Sky’s premium entertainment, films and sports offerings have traditionally been unmatched in the UK until the arrival of Netflix and Amazon Prime – especially from a commercial perspective.”
In 2024, Sky’s content deal with Warner Bros Discovery-owned HBO expires, stripping it of premium US imports such as Game of Thrones, Succession and Euphoria. Meanwhile, the joint venture will be the owner of all that content through Warner Bros Discovery’s newly merged streaming service.
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“Adding that content to the sports on BT Eurosport would create a nicely diverse and ’sticky’ package for a discerning consumer who’s looking for broader choice and not just sport or movies,” says Walkinshaw.
He calls it a “win” for advertisers: “It’s always positive to have new players in the marketplace and more opportunities for brands to create targeted, meaningful media experiences.”
Sports marketing consultant Dan Tunna has previously worked at both Discovery and BT Sport. He says: “Together they have the rights and resources to rival Sky’s position of dominance.” For advertisers looking to capitalize on the combined offering, Tunna says the new entity “will provide significance reach across multiple platforms and channels”.
Away from Sky, other main commercial sports broadcasters are ITV, Dazn and (to a lesser extent) Channel 4. Amazon Prime Video is also starting to make an impact with tennis tournaments and some Champions League matches.
Michael Hannan, broadcast director at Total Media, explains that “the buying power of the joint venture will present a big challenge” to the other UK sports broadcasters “who could seek to increase their share of the Premier League”.
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With the combination of HBO Max and Discovery+’s inventory, Hannan expects “more subscribers moving over and creating more opportunities for advertisers across sporting events”.
Gregor Chalmers, head of broadcast at the indie media agency The Kite Factory, says live sport offers “an increasingly rare opportunity for advertisers to reach a large audience all watching the same content at the same time in a shared moment”.
Chalmers ponders whether the joint venture will establish a new sales house and whether that will lead to increased competition in the broadcaster sales arena. “This would be a bold move but would increase the options on the table for agencies and brands, and as the Lionesses showed us this summer there is a healthy appetite to get behind true sporting success stories,” he says. “Speak to any TV buyer and they’ll tell you that competition can only be a good thing, so we’ll be watching this space carefully.”
“Sports products live and die by the rights,” adds TV and online video analyst at Omdia, Matthew Evenson. According to Evenson, their combined sports rights might “help to reduce churn when popular sports, such as Premier League football, are in their off-season as subscribers may decide to keep their subscription if they have access to other events”.
Looking at the rest of the market, Everson adds that the merger will help the two businesses “stay competitive” as the streamers and tech giants like Amazon and Apple join the live sporting arena.