BSkyB to pay RTE to go on satellite

Charles Slane

There's a report in the Irish edition of today's Sunday Times titled "RTE Programmes beamed across America in £10 million deal".

The article mainly deals with a new digital channel in the States that will broadcast RTE programes, but toward the end of the article it's mentioned that BSkyB will pay RTE a fee when it has 400,000 subscribers; at the moment the figure is 193,000.

So it turns out that not only are RTE not paying to be on Sky Digital (as the cable companys had claimed), but they'll actually make money out of the deal if Sky get a stronger foothold.

I wonder what this information will mean to TV3, UTV and Channel 4's negotiations with Sky for carriage in the Republic.

It also sheds some light on why RTE were prepared to lessen the value of their broadcasting system (by going on a competing platform) prior to it's sale to an independent company.

Interesting Charles,
Of Course SKY Digital and ITV are competitors on the digital platform front in the UK.
RTE will not have a digital platform of its own in Ireland as that will be a private company.
So therefore RTE had a significant card in its pack in its negotiations with Sky. It was in a position to say it could grow Skys subscriber base by being there,whilst at the same time not having a competing platform doing the opposite.
Depending on the success of DTT, when it starts,RTE could always pull the plug on Sky-if their finances merit doing so.
They will never do that, but they will always have that card to play.
Imagine the discontent if RTE left...that argument only applies of course if theres competition.
mm

Charles Slane

And of course you can always rely on the Sunday Business Post for a good Sky Digital story.

This week it has the heading "TV3 up despite Granada woe", and it's mostly about TV3's ad revenues etc.

The full story is here -

http://www.sbpost.ie/story.jsp?bottomadvert=&rightadverts=&rightnav=/common/navs/right/sponsorsnav.jsp&leftadverts=BusinessStandard&advert=/common/adverts/top/sundaypaper.htm&title=Sunday+Paper&story=WCContent;id-33483&list=businesspost

But just at the end it says the following -

Hetherington confirmed that TV3 has held discussions with Sky about a possible move onto the British company's digital platform but said no agreement was imminent. RTE has already negotiated a deal with Sky for the use of the platform. "We're platform neutral," said Hetherington. "Any arrangement has to be commercially valuable for us. We would seek some return on that investment."

So ... "no agreement is imminent" .. well we've heard that kind of line before ... "We would seek some return on that investment"... so are TV3 now looking for an RTE-type deal where they'd get a fee after Sky gets a certain number of subscribers in Ireland ?

Wouldn't you love to be a fly on the wall at some of those meetings ?

cableskeptic

So if we can believe the newspaper reports up to now the deal between RTE & Sky goes something like this:

1. RTE to pay Sky £6 million for existing services to be carried in the ROI and NI (plus radio services carried in the UK).

2. A bonus will be paid to RTE when Sky reaches 400k subs (a fairly safe bet I would think).

3. Sky to aid RTE in getting £10 million from US partners who would chose to carry RTE's content.

It seems like a reasonable deal for RTE but I wonder how much Sky will charge RTE in the future when they are locked in (especially if RTE ressurect their plans for more channels). Does anyone know when the £6 million runs out?