Is Sky TV About to Be a Thing of the Past for Sports Broadcasting?

Yesterday, on 2 August, the sports broadcasting landscape changed permanently, as Amazon outbid Sky TV in the UK for the rights to tennis’s ATP World Tour. The biggest event in tennis outside of the four Grand Slams, it is believed that the e-commerce titan paid NZ$17.8 million for the rights. This uprising has been a long time coming, as viewers are rapidly warming to the idea of online streaming, as Duco and their director, Dean Lonergan, has come to find this year. In a generation comfortably accustomed to spending days on end in front of a laptop screen, Amazon have taken the logical next step.

Comparatively, Netflix already boasts that 100 million users have subscribed worldwide. Netflix bases their service around the ability to pick and choose content to watch, as opposed to the Sky service which is all about bundle packages. Basically, viewers can pick and choose what they watch, when they watch it and how long they need to watch it for – there’s no six-month subscription needed. With most sports being a seasonal event, people simply aren’t willing to be locked in like that, and they don’t see the need to take a package deal that involves other sports they know they will never watch.

Closer to home, Sky TV NZ’s share price has fallen from $4.93 to $3.27 over the past year, and in February it posted a 32 percent drop in first half profits as content costs increased and subscriber numbers fell. What makes it even more alarming is that it has happened in little old New Zealand, where Sky has, for all intents and purposes, a monopoly over the market. While it may be some time before Amazon's foray into sport played in New Zealand, the company is expanding its operation in Australia and they do have eyes on global domination. When Amazon signed the NFL deal, the company's Head of Business Development Jeff Blackburn said: "For us, this is about starting to bring live sports to our Amazon Prime members all around the world."

Look Sky, I’m no fucking economist or marketing genius, but I seriously doubt anybody gives a fuck about the stupid amount of World Surf League, World Rally Championship or, currently, Tour of Poland that you’re showing. One has to question why the money is being invested into these sorts of sporting events rather than, for example, aiming to get back the rights to the English Premier League. The reality? They simply don’t have the money anymore, and the time is quickly coming when Blackburn and his boys are going to run this town.

To put it bluntly, far too many Kiwis don’t have the disposable income to pay the genuinely stupid amounts that Sky are still asking for to get their shit service, and there are far cheaper options now, especially online. Christchurch resident and former Sky customer Zane Young recently expressed his disgust, describing Sky as “an ex girlfriend – the only time I ever hear from you is when you want money”. He had been a Sky customer for seven years, spending $140 per month on it to a total of $11,760.

The last straw came when a friend was offered a cut-price deal to have a Sky TV and Sky Sport package for just $40 a month for six months - an offer he'd never received despite seven years of loyalty. Young left Sky with some ‘parting advice’, telling the channel the changes he thought it should make to keep customers happy.

"It's time you pulled your big boy pants up and admit defeat. If you didn't have Super Rugby you wouldn't have a business," he wrote.

"Reduce your price and move to an online-based platform where you pay per channel."

Young's post has attracted 2600 comments and 1200 shares, with many readers agreeing with his sentiments.

Just quickly, don’t bother with Sky’s current online-based platform, SkyGo. It’s about as much of a waste of time as a 100-level Tourism lecture, and breaks down about as often as a fresher after their first attempt at a goon before noon.

Think this is just happening under Sky NZ’s nose? Guess again. The traditional subscription model appears to be broken. In the UK, Sky TV paid £4.2 billion (NZ$7.5 billion) in 2015 to show Premier League football. It was 83 percent more than its previous deal, but ratings declined last season and the company last week announced a 14 percent fall in operating profits. In America, ESPN is losing subscribers as programming costs soar to US$8 billion (NZ$10.8 billion) for 2017, while Netflix and Amazon Prime users continue to rise.

For most New Zealanders, it really is just rugby that’s keeping us with Sky anymore. There's one other way this could play out for rugby fans. What if New Zealand Rugby built its own streaming app? This is exactly what the NBA did. NBA League Pass lets you watch every game live or on-demand, not just the relatively few games that show up on ESPN (via your Sky Sports package, here in New Zealand). It costs $42.99 per month to subscribe to NBA League Pass, so it doesn't come cheap. But avid NBA fans will pay what's necessary. There aren't a huge number of those in New Zealand, but there are a lot of avid rugby fans. Although it's much more likely NZR will simply sell the rights for an astronomical sum.

As for the next few years, I'm afraid we're stuck with Sky's cable TV box or its buggy apps that may disconnect at any moment.

This article first appeared in Issue 18, 2017.
Posted 11:49am Sunday 6th August 2017 by Charlie Hantler.