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BT makes “last-ditch effort” on TV packages

Customers will need to take a rather unflexible 24-month broadband contract in order to get the supposedly "flexible" deals

BT Group PLC -

BT Group PLC (LON:BT.A) shares headed lower as the telecoms group made what analysts called a “last-ditch effort” to make a success of its television business.

The FTSE 100 group has launched a more flexible television service where existing broadband customers can change their package every month, in an attempt to try and compete with the new streaming might of Netflix and Disney+.

READ: BT, Vodafone and TalkTalk face “disruption” from new price war

Two months ago, BT launched a monthly pass that would allow people without a BT broadband contract to watch its sports content for £25 a month.

But the new contracts will require customers to take a 24-month broadband contract, then pay upwards of £10 a month to add BT Sport, Sky Sports and other entertainment packages.

“Being flexible is more in tune with how customers want to consume content in a streaming world,” said Marc Allera, the boss of BT’s consumer arm. “For example, the race for the Premier League title may be over in a few weeks and once that is done some viewers may prefer to spend their money on movie, or entertainment, packages.”

To get all the sports coverage it would cost an extra £40 per month.

Sky will also be offering BT Sport directly to its own customers when the new packages are launched, on 21 February.

Paolo Pescatore, media analyst at PP Foresight, said BT was “unlikely to pose a considerable threat to Sky”.

He added: “This long overdue move feels like a last-ditch effort to be successful in TV.”

Pivotal year

Telecoms companies are expected to make big moves on pricing this year as they react to pressure from Ofcom to improve customer "fairness", with the regulator estimating that around 40% of UK broadband customers are out of contract and pay roughly 30-35% more than new customers.

Under new rules that started last Saturday, 15 February, all broadband providers must tell customers when their contract comes to an end and inform them about the best deals being offered to new clients.

In video and TV there is further pressure for companies to differentiate their offerings with the arrival of the new video streaming service from Disney, while others strengthen their TV platforms.

BT, as the biggest operator, has the most to lose and its shares lost 1% to 152.07p on Tuesday morning.

Quick facts: BT Group PLC

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