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Logo since 2009
|Type||Public limited company|
|Traded as||LSE: BSY|
British Satellite Broadcasting
|Headquarters||Osterley, London, United Kingdom|
|Area served||United Kingdom and Ireland|
|Key people||Nicholas Ferguson (Chairman)
Jeremy Darroch (CEO)
|Products||Direct-broadcast satellite, Pay television, broadcasting, broadband and telephony services,|
|Revenue||£6.791 billion (2012)|
|Operating income||£1.243 billion (2012)|
|Net income||£970 million (2012)|
British Sky Broadcasting Group plc (commonly known as BSkyB; trading as Sky) is a British satellite broadcasting, broadband and telephone services company headquartered in London, with operations in the UK and Republic of Ireland. Formed in 1990 by the equal merger of Sky Television and British Satellite Broadcasting, BSkyB is the largest pay-TV broadcaster in Britain and Ireland with over 10 million subscribers.
BSkyB is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index. It had a market capitalisation of approximately £11.47 billion (US$18 billion) as of 20 June 2012 on the London Stock Exchange. News Corporation owns a 39.14 per cent controlling stake in the company.
British Sky Broadcasting was formed by the merger of Sky Television and British Satellite Broadcasting on 2 November 1990. Both companies had begun to struggle financially and were both suffering financial losses as both competed against each other for viewers. The Guardian later characterized the merger as 'effectively a takeover by News Corporation'.
The merger was investigated by Office of Fair Trading but was cleared a month later since many of the represented views were more concerned about contractual arrangements which had nothing to do with competition. The Independent Broadcasting Authority was not consulted about the deal; after approval, the IBA demanded precise details about the merger, stated they were considering the repercussions of the deal to ultimately determine whether BSB contracts were null and void. On 17 November, the IBA decided to terminate BSB's contract, but not immediately, as it was deemed unfair to 120,000 viewers who had bought BSB devices.
Sam Chisholm was appointed CEO  in a bid to reorganize the new company, which continued to make loses of £10 million per week. The defunct BSB's HQ, Marco Polo House were sold off, 39% of the new company's employers were made redundant to leave just under 1000 employees, many of the new senior BSkyB executive roles were given to Sky personnel with many BSB leaving the company. In April the nine Sky/BSB channels had been condensed into five, with EuroSport being dropped soon after the Sky Sports launch. Chisholm also renegotiated the merged company's expensive deals with the Hollywood studios, slashing the minimum guaranteed payments. The defunct Marcopolo I satellite was sold off in December 1993 to Sweden's NSAB, and Marcopolo II went to Norway's Telenor in July 1992 after the ITC was unable to found new companies to take over the BSB licences and compete with BSkyB. News International received 50%, Pearson PLC 17.5%, Chargeurs 17.5%, Granada 12%, Reed International 2% of the new shares in the company.
By September 1991, the weekly losses had been reduced to £1.5M a week, Rupert Murdoch said "there were strong financial marketing and political reason[s] for making the compromise merger instead of letting BSB die. Many of the lessons had been learnt with more than half the running cost of the combined company" Further cuts in losses were a direct result of 313,000 new customers joining during the first half of 1991. By March 1992, BSkyB posted its first operating profits, of £100,000 per week, with £3.8 million weekly from subscriptions and £1 million from advertising, but continued to be burdened with £1.28 billion of debt. James Capel forecast BskyB would still be indebted in 2000.
Premiership football 
In the Autumn of 1991, talks where held for the broadcast rights for Premier League for a five-year period, from the 1992 season. ITV were the current rights holders, and fought hard to retain the new rights. ITV had increased its offer from £18M to £34M per year to keep control of the rights. BSkyB joined forces with the BBC to make a counter bid. The BBC was given the highlights of the most the matches, while BskyB paying £304 million for the Premier League rights, with give them a monopoly of all live matches, up to 60 per years from the 1992 season.  Murdoch has described sport as a "battering ram" for pay-television, providing a strong customer base. A few weeks after the deal, ITV went to the High court to get an injection as it believe their details were leaked before the decision was taken. ITV also asked the Office of Fair Trading to also investigate since it believed Rupert Murdoch's media empire via the newspapers had influence the deal. A few days later neither action took effect, ITV believed BSkyB was telephoned and informed of its £262M bid, and Premier League advised BSkyB to increase its counter bid.
Following a lengthy legal battle with the European Commission, which deemed the exclusivity of the rights to be against the interests of competition and the consumer, BSkyB's monopoly came to an end from the 2007–08 season. In May 2006, the Irish broadcaster Setanta Sports was awarded two of the six Premiership packages that the English FA offered to broadcasters. Sky picked up the remaining four for £1.3 billion.
Sky Multichannels 
The service started on 1 September 1993 based on the idea from the then chief executive officer, Sam Chisholm and Rupert Murdoch, of converting the company business strategy to an entirely fee-based concept. The new packaged included Four channels formerly available free-to-air, broadcasting on Astra's satellites, as well as introducing new channels. The service continued until the closure of BSkyB's analogue service on 27 September 2001, due to the launch and expansion of the Sky Digital platform. Some of the channels did broadcast either in the clear or soft encrypted (whereby a Videocrypt decoder was required to decode, but without a subscription card) prior to their addition to the Sky Multichannels package. With in two months of the launch, sky gained 400'000 new subscribers, with the majority taking at least one premium channel as well, which helped BSKYB reach 3.5 million households by mid-1994. Micheal grade criticised the operations in front of the Select committee, mainly for the lack of original programming on many of the new channels.
In October 1994, BSkyB announced its plans to float the company on the UK and US stock exchanges, selling off 20% of the company. The stock flotation, reduced Murdoch's holding to 40 percent, raised £900m which allowed the company's to cut its debt in half. Sam Chisholm said "By any standards this is an excellent result, in every area of the company has performed strongly". Chisholm, become one of the world's most highly paid television executives.
- BSkyB opened its second customer management centre at Dunfermline, Scotland, to complement its original centre at livingston which opened in 1989.
- BSkyB enters the FTSE 100 index.
- Operation profits increase to £155M a year
- Pearon, sold off it 17.5% stake since it has no management control at the company
Sam Chisholm resigned from BSkyB, due to a rift with Rupert Murdoch. A week later, Murdoch was quoted as saying "I cannot understand the fuss BSkyB was grossly overpriced", which caused further rifts with the new management.
Sky Digital 
In 1997, BSkyB formed a partnership with Carlton and Granada to bid for the right for the new Digital terrestrial network. In June, it was awarded the right to start the service, ONdigital under the condition BSkyB withdrew from the group's bid. A few days afterwards BSkyB left the consortium, and work fully concentrated on their new Digital satellite network.
The launch of the Astra 2A satellite at a new orbital position, 28.2° east, in 1998 (subsequently followed by more Astra satellites as well as Eutelsat's Eurobird 1 (now Eutelsat 28A) at 28.5°E), enabled the company to launch a new all-digital service, Sky, with the potential to carry hundreds of television and radio channels.
Virgin Media dispute 
Virgin Media (re-branded in 2007 from NTL:Telewest) started to offer a high-definition television (HDTV) capable set top box, although from 30 November 2006 until 30 July 2009 it only carried one linear HD channel, BBC HD, after the conclusion of the ITV HD trial. Virgin has claimed that other HD channels were "locked up" or otherwise withheld from their platform, although Virgin did in fact have an option to carry Channel 4 HD in the future. Nonetheless, the linear channels were not offered, Virgin instead concentrating on its Video On Demand service to carry a modest selection of HD content. Virgin has nevertheless made a number of statements over the years, suggesting that more linear HD channels are on the way.
In 2007, BSkyB and Virgin Media became involved in a dispute over the carriage of Sky channels on cable TV. The failure to renew the existing carriage agreements negotiated with NTL and Telewest resulted in Virgin removing the basic channels from the network on 1 March 2007. Virgin claimed that Sky had substantially increased the asking price for the channels, a claim which Sky denied, on the basis that their new deal offered "substantially more value" by including HD channels and Video On Demand content which was not previously carried by cable.
In response, Sky ran a number of TV, radio and print advertisements claiming that Virgin media 'doubted the value' of the channels concerned, at first urging Virgin customers to call their cable operator to show their support for Sky, but later urging Virgin customers to migrate to Sky to continue receiving the channels. The broadcasting regulator Ofcom subsequently found these commercials in breach of their code.
The availability (at an extra charge) of Sky's premium sport and movie services was not affected by the dispute. This impasse continued for twenty-one months, with both companies initiating High Court proceedings. Amongst Virgin's claims to the court (denied by Sky) were that Sky had unfairly reduced the amount which it paid to VMTV for the carriage of Virgin's own channels on satellite.
Eventually, on 4 November 2008 it was announced that an agreement had been struck for Sky's Basic channels – including Sky1, Sky2, Sky3, Sky News, Sky Sports News, Sky Arts 1, Sky Arts 2, Sky Real Lives and Sky Real Lives 2 to return to Virgin Media from 13 November 2008 until 12 June 2011. In exchange will be provided continued carriage of Virgin Media Television's channels – Living, Livingit, Bravo, Bravo +1, Trouble, Challenge and Virgin1 for the same period.
The agreements include fixed annual carriage fees of £30m for the channels with both channel suppliers able to secure additional capped payments if their channels meet certain performance-related targets. Currently there is no indication as to whether the new deal includes the additional Video On Demand and High Definition content which had previously been offered by Sky. As part of the agreements, both Sky and Virgin Media agreed to terminate all High Court proceedings against each other relating to the carriage of their respective basic channels.
Virgin1 was also a part of the deal but was rebranded as Channel One on 3 September 2010, as the Virgin name was not licensed to Sky. The new carriage deals are understood to be for up to nine years.
On 20 July 2010, The Office of Fair Trading announced that they would review BSkyB's acquisition of the Virgin Media Television business to judge whether it posed any competition concerns in the UK. The OFT planned to investigate the deal to see whether it could constitute a qualifying merger under the Enterprise Act 2002. The watchdog invited interested parties from the industry to comment on the sale, including its potential impact on the pay-TV market. On 14 September 2010, The OFT decided not to refer BSkyB's takeover of Virgin Media's TV channels to the Competition Commission.
BSkyB's direct-to-home satellite service became available in 10 million homes in 2010, Europe's first pay-TV platform in to achieve that milestone. Confirming it had reached its target, the broadcaster said its reach into 36% of households in the UK and Ireland represented an audience of more than 25 million people. The target was first announced in August 2004, since then an additional 2.4 million customers had subscribed to Sky's direct-to-home service. Media commentators had debated whether the figure could be reached as the growth in subscriber numbers elsewhere in Europe flattened.
BSkyB announced that it was moving some channels further up the listings of its electronic programming guide. It was, reported Broadband TV News, the biggest reshuffle in EPG positions for over a decade, with MTV, Comedy Central, Universal, Syfy, News Corporation's FX, and 40 HD channels moving to more prominent places.
In September 2012, United Kingdom broadcasting regulator Ofcom ruled that BSkyB could stay on air –but it criticised former chairman Murdoch's handling of the News International phone hacking scandal. ‘As a company, we are committed to high standards of governance and we take our regulatory obligations extremely seriously,’ BSkyB replied in a media release.
On 26 September 2012, BSkyB relaunched its “Anytime+” on-demand-via-broadband service as “On Demand” as the BBC’s iPlayer joined the line-up of channels offering catch-up TV on the company’s Sky+ or Sky HD box – linked to an ADSL modem, the signal from which was recorded before viewing. The BBC was making the preceding week’s programmes available alongside ITV, Channel 5 and the partly BBC Worldwide-owned UKTV, as well as BSkyB’s own channels - with Channel 4’s 4oD service due to join the line-up in 2013.
London’s right-of-centre Daily Mail reported that the UK government’s benefits agency was checking claimants’ ‘Sky TV bills to establish if a woman in receipt of benefits as a single mother is wrongly claiming to be living alone’ – as, it claimed, subscription to sports channels would betray a man’s presence in the household. And, in December, the UK’s parliament heard a claim that a subscription to BSkyB was ‘often damaging’, along with alcohol, tobacco and gambling. Conservative MP Alec Shelbrooke was proposing the payments of benefits and tax credits on a “Welfare Cash Card” that could be used to buy only “essentials”.
On 12 July 2011, former Prime Minister, Gordon Brown claimed that BSkyB's majority owner - News Corporation attempted to affect government policy with regards to the BBC in pursuit of their own commercial interests (i.e. BSkyB). He went further, in a speech in Parliament on 13 July 2011, stating:
"Mr James Murdoch, which included his cold assertion that profit not standards was what mattered in the media, underpinned an ever more aggressive News International and BSkyB agenda under his and Mrs Brooks’ leadership that was brutal in its simplicity. Their aim was to cut the BBC licence fee, to force BBC online to charge for its content, for the BBC to sell off its commercial activities, to open up more national sporting events to bids from BSkyB and move them away from the BBC, to open up the cable and satellite infrastructure market, and to reduce the power of their regulator, Ofcom. I rejected those policies." 
"The company has lots of technological innovation that only a robust entrepreneur could to bring to British society, but it has also often been profoundly anti-competitive. I believe that the bundling of channels so as to increase the profit and make it impossible for others to participate in the market is anti-competitive. I believe that the way in which the application programming interface—the operating system—has been used has been anti-competitive and that Sky has deliberately set about selling set-top boxes elsewhere, outside areas where they have proper rights. If one visits a flat in Spain where a British person lives, one finds that they mysteriously manage to have a Sky box there even though it is registered to a house in the United Kingdom."
The first CEO of BSkyB was Sam Chisholm, who was CEO of Sky TV before the merger. Chisholm served in this position until 1997. He was followed by Mark Booth who was credited with leading the company through the introduction of Sky. Tony Ball was appointed in 1999 and completed the company's analogue to digital conversion. He is also credited with returning the company to profit and bringing subscriber numbers to new heights. In 2003, Ball announced his resignation and James Murdoch, son of Rupert Murdoch was announced as his successor. This appointment caused allegations of nepotism from shareholders.
On 7 December 2007, it was announced that Rupert Murdoch would be stepping down as BSkyB's Non-Executive Chairman and would be replaced by his son, James. It was announced in 2007 that James would be stepping down as CEO of BSkyB and will be replaced by Jeremy Darroch.
News Corporation takeover proposal 
|British Sky Broadcasting Ltd
The original Sky Television plc, now a holding company.
|Sky Subscriber Services Ltd
Operating company for the Sky pay-television service.
|Sky Broadband Ltd
Operating company for Sky's broadband and telephony services.
|Sports Internet Group Ltd
Sports content and online betting services.
|British Interactive Broadcasting Holdings Ltd
Interactive television services, formerly an alliance of BSkyB, BT Group, HSBC and Matsushita.
Being both an agency and a media owner, run many successful sites.
|Aura Sports Ltd
Media Sales Agency, sells advertising on the majority of premiership football club websites, as well as other major sports.
|Aura Play Ltd
Another Media Sales Agency, sells advertising across a number of websites in the music and entertainment sector.
Operating company for Sky pay-television service in the Republic of Ireland.
A video on demand movie rental service.
Wi-Fi provider acquired by BSkyB.
|A+E Networks UK (50%) – with A+E Networks. Operates History (UK), Bio. (UK) and Crime & Investigation Network (UK) channels.|
|Attheraces Holdings Limited (48.5%) – with Arena Leisure. Operates At the Races.|
|Australian News Channel Pty Limited (33.3%) – with Seven Network and Nine Entertainment Co.. Operates Sky News Australia.|
|Nickelodeon UK Ltd (40%) – with Viacom International Media Networks Europe, part of Viacom. Operates Nickelodeon and associated channels.|
|Comedy Central (UK and Ireland) (25%) – with Paramount British Pictures, part of Viacom|
|DTV Services Ltd (20%) – with Arqiva, BBC, Channel 4 and ITV plc. Manages and markets the Freeview brand.|
|NGC Network International LLC and NGC Network Latin America LLC (21%) – with National Geographic.|
Stake in ITV 
ITV plc has been the subject of a flurry of rumored take-over and merger bids since it was formed. For example, on 9 November 2006, NTL announced that it had approached ITV plc about a proposed merger. The merger was effectively blocked by BSkyB on 17 November 2006 when it controversially bought a 17.9% stake in ITV plc for £940 million, a move that attracted anger from NTL shareholder Richard Branson and an investigation from media and telecoms regulator Ofcom. On 6 December 2006, NTL announced that it had complained to the Office of Fair Trading about BSkyB's move. NTL stated that it had withdrawn its attempt to buy ITV plc, citing that it did not believe that there was any possibility to make a deal on favourable terms.
Financial results have been as follows:
Criticism and controversies 
Digital terrestrial television 
BSkyB initially faced competition from the ONdigital digital terrestrial television service (later renamed ITV Digital). ITV Digital failed for numerous reasons, including, but not limited to numerous administrative and technical failures, nervous investors after a large down-turn in the advertising market and the dot com crash, and BSkyB's aggressive marketing and domination of premium sporting rights. While Sky had been excluded from being a part of the ONdigital consortium, thereby making them a competitor by default, Sky was able to join ITV Digital's free-to-air replacement, Freeview, in which it holds an equal stake with the BBC, ITV, Channel 4 and National Grid Wireless. Prior to October 2005, three BSkyB channels were available on this platform: Sky News, Sky Three, and Sky Sports News. Initially BSkyB provided Sky Travel to the service. However, this was replaced by Sky Three on 31 October 2005, which was itself later rebranded as 'Pick TV' in 2010. On 8 February 2007, Sky announced its intention to replace its three free-to-air digital terrestrial channels with four subscription channels. It was proposed that these channels would offer a range of content from the Sky portfolio including sport (including English Premiership Football), films, entertainment and news. The announcement came a day after Setanta Sports confirmed that it would launch in March as a subscription service on the digital terrestrial platform, and on the same day that NTL's services re-branded as Virgin Media. However, industry sources believe Sky will be forced to shelve plans to withdraw its channels from Freeview and replace them with subscription channels, due to possible lost advertising revenue.
Video on demand 
Sky is facing increased competition from telecommunications providers delivering pay television services over existing telephone lines using ADSL. Such providers are potentially able to offer "triple-play" or "quad-play" packages combining land-line telephone, broadband Internet, mobile telephone and pay television services. To compete with these providers, in October 2005, BSkyB bought the broadband Internet Service Provider Easynet for £211 million. This acquisition allowed BSkyB to start offering a Sky-branded broadband service as well as a "triple play" package combining satellite television, land-line telephone and Broadband service. Sky also offers some streaming live TV channels to a computer using Microsoft's Silverlight.
Game consoles 
On 29 May 2009, it was confirmed that Sky Go would be made available via Microsoft's Xbox 360 games console. Although Sky Go is not available on the PlayStation 3, in November 2011 Sony Computer Entertainment (株式会社ソニー·コンピュータエンタテインメント) struck a deal with Sky to bring some of its shows to the PlayStation Store Video Store. Users are able buy individual TV episodes in SD or HD.
On 1 March 2013, it was announced that BSkyB would buy O2's and Be's broadband services from Telefónica for £180 million up front plus another £20 million once customers have been transferred. Telefónica said the deal would allow it to concentrate on providing better mobile services, including rolling out 4G.
High Definition 
Sky launched its HDTV service, Sky+ HD, on 22 May 2006. Prior to its launch, Sky claimed that 40,000 people had registered to receive the HD service. In the week before the launch, rumours started to surface that Sky was having supply issues with its Set Top Box (STB) from manufacturer Thomson. On Thursday 18 May 2006, and continuing through the weekend before launch, people were reporting that Sky had either cancelled or rescheduled its installation. Finally, the BBC reported that 17,000 customers had yet to receive the service due to failed deliveries. On 31 March 2012, Sky announced that the total number of homes with Sky+HD currently stands at 4,222,000.
Sky began to broadcast programmes in 3D in April 2010. This included new 3D channels, including a Sky Sports 3D and Sky Movies 3D. Sky previously experimented with 3D broadcasting by broadcasting an Arsenal vs Manchester United football game live in 3D in nine pubs situated throughout the United Kingdom and Ireland.
Sky subscribers in the Republic of Ireland have a different choice of channels compared to the UK. The standard Irish channels RTÉ One, RTÉ Two, TV3, TG4 and 3e are available to all Irish subscribers and unavailable by any other means on satellite. Free to air channels like the ITV and the Channel 5 family of channels, can only be tuned via the Other Channels section.
Sky utilizes the VideoGuard pay-TV scrambling system owned by NDS, a Permira/News Corporation company. There are tight controls over use of VideoGuard decoders; they are not available as stand-alone DVB CAMs (Conditional Access Modules). BSkyB has design authority over all digital satellite receivers capable of receiving their service. The receivers, though designed and built by different manufacturers, must conform to the same user interface look-and-feel as all the others. This extends to the Personal video recorder (PVR) offering (branded Sky+). BSkyB initially charged additional subscription fees for using a Sky+ PVR with their service; waiving the charge for subscribers whose package included two or more premium channels. This changed as from 1 July 2007, and now customers that have Sky+ and subscribe to any Sky subscription package get Sky+ included at no extra charge. Customers that don't subscribe to Sky's channels can still pay a monthly fee to enable Sky+ functions. In January 2010 Sky discontinued the Sky+ Box, limited the standard Sky Box to Multiroom upgrade only and started to issue the Sky+HD Box as standard, thus giving all new subscribers the functions of Sky+. In February 2011 Sky discontinued the non-HD variant of their Multiroom box, offering a smaller version of the SkyHD box without Sky+ functionality. In September 2007, Sky launched a new TV advertising campaign targeting Sky+ at women. As of 31 March 2008, Sky have 3,393,000 Sky+ users.
See also 
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