Sky outbids rivals for Virgin channels

BSkyB is reportedly outbidding its rivals by 60% with a GBP160m (USD259m) offer forVirgin Media’s TV channels. The figure is GBP60m (USD97m) more than currently on offer from rival bidders such as Channel 4, Time Warner, RTL and NBC Universal, according to the Financial Times (FT).

Recent estimates value the VMTV package, consisting of Living, Living Two, Bravo, Bravo Two, Challenge, Challenge Jackpot and Virgin, at between GBP100 (USD162m) and GBP130m (USD210m).

However, Virgin will give careful consideration to selling its seven channels to Sky, which is its biggest rival in distribution programming.

Analysts and commentators say the move is unexpected, especially in light of comments Sky made in its legal battle with Virgin over how much each broadcaster should charge for hosting the other’s content. At the time, Sky said the content on VMTV was almost worthless to its own customers.

One anonymous analyst tells the FT that Sky may be trying to push up the price of the channels simply so its competitors have to pay more to buy them: ?There has been speculation that Sky wants to make sure that whoever buys these channels – especially if it is a direct rival such as Channel 4 or Five – has to pay as much as possible," he says.