Sir Michael Rake, chairman of BT, has admitted that the UK telecoms group had attempted an audacious raid for Sky’s rights to Premiership football in the face of criticism from shareholders about the cost of the matches that it had acquired.
Shareholders expressed concern about the £738m spent by BT on the 38 matches at its annual meeting on Wednesday which also heard questions from individual investors about the level of payment to management. However, there was overall shareholder support for the management package, with 93.8 per cent of proxy votes cast in favour of the remuneration report.
There was also overwhelming support for the re-election of the board, although Sir Michael refused to comment on questions linking him to the chairmanship of Barclays to succeed Marcus Agius.
Patricia Hewitt, chair of BT’s remuneration committee, said that there was “no question at all about the chairman’s commitment” to the company.
Sir Michael reassured the shareholders who complained about the company’s returns over a five-year period that it was committed to returning to profitable growth.
BT’s emphasis on content is a part of this goal. BT surprised the market by emerging with 38 games following the auction of the football rights last month, leaving Sky the remaining 116 games per season.
The confirmation that it had bid for more of those won by Sky could surprise analysts given the effect that even the £246m-a-year deal is expected to have on earnings in the period. The telecoms group has previously never commented, citing contract confidentiality.
The attempt to buy more of the rights underlines the importance of owning content to BT as it seeks to accelerate the growth of its TV service.
Ian Livingstone, chief executive, said at the shareholder meeting that the group would drive returns from owning the rights by bundling football packages into its broadband and TV packages. BT will create a football-based channel that will feature the games.
In response to other shareholder questions, Mr Livingstone said that BT was working with Olympic organisers and mobile operators such as O2 about ensuring that the telecoms network would remain unaffected by the heavy use expected during the games. He said that BT was providing increased capacity to mobile networks during the period.
He also said that BT was attempting to secure similar rights of access to overseas networks run by companies such as Deutsche Telekom and Verizon that BT gives them in the UK.