The case analyzes British Sky Broadcasting Group PLC (BSkyB), a monopoly and market leader in the Premier League football market, and the issues it faces as the company nears its Premier Football expiration and as governmental regulators begin targeting its business. It is highly recommended for BSkyB to: (1) renew its Premier League Football license to continue reaping the benefits and competitive market power of being a monopoly, (2) continue focusing on one niche market, the satellite TV market, and (3) leverage its strategic efforts on competing and entering global markets.
In 1990, the company BSkyB evolved out of the 50:50 financial merger of two satellite companies, British Satellite Broadcasting (BSB) and Sky Television. BSkyB provides a range of entertainment and television content via satellite within the United Kingdom and the Republic of Ireland and distributes wholesale to its other distribution platforms. Sports programming, in particular, live coverage of Premier League Football, is at the core of BSkyB’s value proposition to its customers and one of the main attractions. Based on a sample size of 654 subscribers to satellite and cable TV, 82% regularly watch Sky Sports Football and 47% stating football as their most favorite Sky Sport.
BSkyB operates both as a channel provider and as a retailer of pay-TV, with consumption in September 1998 representing 6.15 million for all households in the UK. With nearly 17 million viewers, digital satellite television operator BSkyB stands as the UK’s top pay television provider. The UK television is experiencing a period of significant change with continuing developments in broadcasting via cable satellite and digital terrestrial platform The total UK television market grew from £4.21bn in1995 to £7.19bn.in 2000, which is approximately a 71% growth. Now its total value is approximately £10.14bn., which is a further 41% growth comparing with the year 2000.... [continues]
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