BT rugby deal shows the way for Eircom
LAST week's TV deal between BT and the English Rugby Premiership clubs, which threatens the Heineken Cup, points to a possible way forward for Eircom. Does the telco's future now lie in TV rather than fixed-line telephony or broadband?
BT's bold agreement to pay English rugby clubs up to £152m for TV rights has been overshadowed by the controversy inevitably generated about the future of the Heineken Cup.
We can leave the row as to who owns the TV rights to English clubs' European games to the lawyers. Of far more interest is the pointer which the deal gives to the possible future of incumbent telcos such as BT and, in this country, Eircom.
The rugby deal isn't BT's first foray into sport. Last June it agreed to pay £738m for the right to broadcast 38 Premiership soccer games a season.
BT is muscling in on Sky's patch big time. Which, given the fact that the TV and cable companies have been doing the same to the telcos for the past decade or more, should hardly come as any great surprise.
Now it would appear that BT is determined to do to Sky, Virgin and UPC in the TV space what they have been doing to the telcos in telecoms and broadband.
Readers with long memories will need no reminding that Eircom was forced to sell Cablelink, the direct ancestor of UPC's Irish operations, in 1999. With Eircom now owned by its banks and still owing €2.4bn, it desperately needs new revenue streams to justify the €400m it plans to invest in high-speed broadband over the next three years.
Since selling Cablelink, Eircom has made several tentative efforts to re-enter the TV market, all of which were rebuffed by the regulator. Somehow we feel that, with the BT example in front of them and needing to justify an expensive investment programme, Eircom's new owners won't be inclined to take "no" for an answer this time around.
Sunday Indo Business