BSkyB

   Sky TV was launched in Britain in 1988, and from very shaky foundations has become a key player in British broadcasting, and the unchallenged master of Britain’s satellite industry. Owned by Rupert Murdoch’s News International, about 20 percent of the British population subscribed to Sky in 1996, helping it to make a £250m profit. It is thus a very significant force (a position enhanced by News International’s ownership of The Times and the Sun).

   However, in the late 1980s this outcome was impossible to envisage; the fight between rivals British Satellite Broadcasting and Sky for the satellite market was only helping to destroy both, and the future looked bleak. Then Sky took over BSB in November 1990 (though officially it was a ‘merger’), and although News International remained £4 billion in debt, BSkyB at least had some hope of survival. Ironically the deal that ultimately saved BSkyB (buying the rights to screen top flight English football in 1992) would have been impossible without the BBC. Had the BBC not joined forces with BSkyB in the bid, BSkyB could probably not have won.

   Since then, BSkyB has grown both in size and market share, and offers a wide portfolio of new and classic movies, 24-hour news, lifestyle programmes, family viewing and three sports channels. It is clear that the sport stations are the key to BSkyB’s success, hence the astronomical (and successful) £670m bid for the football deal in 1996; rugby league, rugby union and cricket were also snapped up in the mid-1990s.

   However, BSkyB faces problems in its long-term future. Most seriously, the key football deal was placed under investigation by market regulators in both the EU and Britain in 1996. Channel 5 came on air in the UK in 1997, cable television is growing in popularity (and is considerably cheaper than BSkyB), and some analysts argue that BSkyB cannot further expand its subscriber base. This means that either subscription rates rise considerably or BSkyB must start to shed some of its sports, either of which will damage market share and profitability. The question of media cross-owner-ship might also affect BSkyB, since if legislation restricting cross-ownership were introduced, the biggest casualty in Britain would be News International. Left untouched, BSkyB will remain very powerful, and has significant expansion plans in areas such as digital broadcasting and pay-per-view that could revolutionize the whole industry (this trend was exemplified by BSkyB’s announced takeover of Manchester United football club in September 1998).

   See also: cable and satellite

   Further reading

    Chippendale, J. and Franks, J. (1992) Dished! The Rise and Fall of BSB, London: Simon & Schuster.

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