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[NTL] [Telewest]
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NTL is the number 1 cable company in the UK following it acquisition of Cable and Wireless Communications from C&W for £8.2bn. It's commercial history is outlined on the Service (Delivery) Providers / Cable page.
NTL has been staking its content strategy on sport, particularly football. In December 1998 it purchased a 6% stake in Newcastle United football club for £10m with an option to buy the rest, though that would probably be subject to the approval of the Monopolies and Merger Commission. A year later it increased its stake to 9.8% and provided a £25m interest free loan in return for sponsorship and the right to run TV channels and internet activities devoted to the club. In 1998 it made a stake in the football club Newcastle United, then in 2000 for another club, Aston Villa, it agreed to handle all its TV, radio and e-commerce transactions in return for injecting £26m, and in March 2000 it agreed a tie-up with Middlesbrough Football Club, taking a 5.6% stake for an undisclosed sum. This continued in June 2000 with a £12.5m loan to Leicester City Football Club in return for a 10% stake and to act as its agent in media and sponsorship rights, followed within days with a £31m partnership with the famous Scottish Glasgow Rangers. This was made up of a £10m media deal and a £21m investment. NTL has a £10m access and development deal for the BBC Sport's Archive.
In June 2000, NTL bid £328m to win the pay-per-view rights to 40 Premier League matches for 3 years. The company reckons there are 12m adult Premier League fans in the UK. 2m of these are in the 4m pay-for-TV homes that do not take BSkyB, numbers that it expects to double over the next 4 years. All in all, it estimates there is an audience of 5m potential viewers who are not BSkyB customers. It believes many of these will be interested in purchasing one-off matches. However some commentators think the sums do not add up. Each Premier League game will cost NTL £2.7m. If it charges £4.99 per game then after costs of say £0.99 (NTL's figures) it will need to attract 675,000 viewers per game. This is about the same record number that watched the Bruno-Tyson boxing match in 1996, the UK's biggest pay-per-view event so far. The commentators were right! In October 2000 NTL withdrew its bid.
NTL and Telewest jointly own a pay-per-view movie channel Front Row that is available on both networks.
Telewest is the other UK major cable operator. It's commercial history is outlined on the Service (Delivery) Providers / Cable page. In March 2000, TeleWest was acquired 80% of Flextech the owner of many thematic TV channels. Telewest has also said it wishes to acquire media magazines to support specialist channels.
Telewest and NTL jointlly own a pay-per-view movie channel Front Row that is available on both networks.
Both Telewest and NTL have borrowed so much money to invest in their infrastructure that they are finding it difficult to raise more funds to provide the television content. Without content they will rely on telephony income (a cut throat market with falling charges) and commission income from selling the content of others.
More minor commercial broadcasters include BT with its 2 cable franchises in Westminster, London and in Milton Keynes. In London it is offering video-on-demand under the brand name Homechoice / VideoNet. It uses ADSL over subscribers normal telephone line and there is a £40 installation fee. From 2001 BT will be allowed to offer TV channels as well. Monthly rental is £6.00 with video rental from £1.99 to £3.49 for 24 hours.
Eurobell, is active in the South East and South West, Video Networks is offering video on demand and interactive television services in a trial in west London, and Kingston Communications, the UK's only local authority telephony company in Kingston-upon-Hull, is also now offering video-on-demand.
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