UPDATE: BT Outlines Competitive TV Football Prices

(Adds analyst comments, details) By Lilly Vitorovich Of DOW JONES NEWSWIRES LONDON (Dow Jones)--Disgruntled football fans in England finally have something to smile about after telecommunications firm BT Group PLC (BT.A.LN) Thursday outlined competitive subscription rates to watch Premier League football matches on its pay-television service. BT Vision customers will be able to receive Sky Sports 1 and Sky Sports 2 channels, which are owned by British Sky Broadcasting Group PLC (BSY.LN) and show the majority of the Premier League football matches, for GBP16.99 a month. If customers only want one of the Sky sports channels, it will cost them GBP11.99 on the provision they subscribe to a new 12 month broadband and BT Vision contract. But if they chose a bundle of broadband and calls for 24 months, they will get all sport channels for GBP11.99 a month. At present, BSkyB doesn't offer a basic TV package consisting of just Sky Sports 1 and 2 channels to customers. Instead, the two channels are included in BSkyB TV packages. "Football fans will be cheering our new prices, which mark an end to paying for basic channels when you only want the sport," BT Retail Chief Executive Gavin Patterson said in a statement. Around 4 million people in the U.K. would like to sign up for Sky Sports channels, but felt that it was too expensive, according to research by BT. BT Vision currently has around 480,000 customers in the U.K., while BSkyB has around 9.8 million. Liberum Capital analyst Mark James described BT's prices as "pretty compelling". "I think it will be well received," said James. BT's pricing details come just a few days after the company secured a wholesale deal with BSkyB to broadcast Sky Sports 1 and Sky Sports 2 on BT Vision from August. The BT deal is likely to trigger a price war with rival Virgin Media Inc. (VMED) which is also expected to reach an agreement with BSkyB before the U.K. Premier League season kicks off August 14. The deal follows a ruling by Ofcom in March that BSkyB must supply its sports channels to rivals at a wholesale price set by Ofcom. BSkyB challenged the ruling and agreed a deal with Ofcom two months ago, whereby the wholesale pricing structure will initially apply only to BT Vision, Virgin Media Inc. (VMED) and Top-UP TV. Under the deal, the three parties would pay Ofcom's regulated price for Sky Sports 1, Sky Sports 2, or both channels. Until the outcome of BSkyB's appeal, the difference between this price and the prevailing rate card price that Sky charges will be paid into escrow. At the conclusion of a full appeal by BSkyB, the Competition Appeal Tribunal will determine the distribution of the money held in escrow. England's football fans were disappointed Sunday when the team was knocked out of the World Cup in South Africa. At 0706 GMT, BT shares were down 2 pence at 128 pence, while BSkyB shares were down 1 pence, at 699 pence in a lower London market. News Corp., which owns Dow Jones & Co., publisher of this newswire and The Wall Street Journal, holds about a 39% stake in BSkyB. -By Lilly Vitorovich, Dow Jones Newswires; 44-0-207 842 9290; lilly.vitorovich@dowjones.com (MORE TO FOLLOW) Dow Jones Newswires July 01, 2010 03:15 ET (07:15 GMT)