Media Perspective: Sky faces a battle to keep hold of the jewel in its crown

Sky celebrates its 20th anniversary this week (see feature, page 20) and no doubt has much to cheer. It may face as many challenges as it always has, but, in one area especially, that of sports coverage, and notably football, it has always excelled.

Much of Sky's success stemmed from the stranglehold it maintained for so long on live coverage of the football Premier League, a deal sealed in 1992 by Rupert Murdoch's then Sky chief executive, Sam Chisholm. Its intensive coverage brought new content and a nicely packaged male audience to advertisers - one of whom, Ford, continues to sponsor live football to this day.

This enabled Sky's ad sales people to turn a mere trickle of revenue into a tidal wave, making it a serious player for the first time against the terrestrial channels.

And, to be fair, it earned the right to do this by redefining standards of live sports coverage and inventing some great programming packages such as Super Sunday and Monday Night Football that were a marketing dream (incidentally, Sky Sports News, essentially a football news channel and one of the best inventions of the modern TV age, celebrated its tenth anniversary last October).

Times are changing, though, and Sky has long since had to share its live football with Setanta. This week it retained its rights to show the majority of Premier League matches but Disney is likely to bid for secondary rights via its ESPN franchise and Setanta is expected to be in the hunt once again, putting the pressure on Sky's men with calculators to deliver.

Sky has retained its key rights this time around (covering seasons 2010 to 2012) with a bid thought to exceed £1 billion. Despite the downturn it can still afford to do this, not least because of subscriptions from pubs, which are thought to cover all but £50 million of the current £438 million annual cost to Sky.

But, it's worth saying again, Sky won't have it all its own way in future. ESPN itself is increasingly looking at Europe as a serious market and, last weekend, Super Bowl weekend, relaunched its NASN channel as ESPN America on the Sky and Virgin Media platforms.

If its early branding and coverage is anything to go by, then ESPN means business, even if US sports are still a niche for most advertisers.

Meanwhile, Sky is increasingly relying on HD content, with sport high up the list, as it crawls determinedly towards its ten million subscriber target. But while darts players such as Phil "The Power" Taylor in HD might be a draw for the dedicated few, football rights, even though total exclusivity has gone, are vital to Sky and one of its few really powerful attractions for advertisers.

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