Sky News Update: Can Sky hold onto its reign?
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It has started to surface that Sky, the well known dominator of its service industry, has started to come under threat from other competitors. This speculation has only heightened since rivals such as BT have put huge injections into their own company, offering new and enticing deals to win over customers. This has put pressure on Sky to make sure they do all they can to remain top of their game, and not lose customers in the face of recent competitors actions.
"Mike Parker, director of sponsorship at Carat, is adamant that BT is a serious contender. "Sky has seen off ITV Digital, Setanta and ESPN, but this is the first time it has had a serious competitor in terms of football, and it is fascinating to see how it will react," he says.
A heavyweight marketing battle beckons: between them, Sky and BT spent an estimated £560m on UK advertising in 2012.
BT has confirmed it will invest at least £30m promoting BT Sport between now and December, with a strong digital emphasis. The brand is encouraging ambassadors such as anchor presenter Jake Humphrey and Manchester United footballer Rio Ferdinand to tweet about its content, although consumer marketing director David James insists any Twitter promotion will be "natural" rather than "contractual".
The aim, he says, is to send awareness "through the roof" and use its sports content as a loss-leader to encourage customers to switch broadband provider. What is certain is that Sky will look to go toe-to-toe with BT.
There is a precedent for the current situation. When, in 2010, BT began offering Sky Sports packages on its BT Vision platform, Sky responded with a marketing campaign knocking BT's proposition. It is expected to respond similarly this summer, with a series of promotional offers to dampen the newcomer's launch.
However, Sky will also be worried by the halo effect BT Sport may have against its rival in the wider battle for consumers' homes.
Andy Kenny, managing director at sponsorship agency brandRapport, says the new content might inject some much-needed glamour into BT's staid brand image.
"BT has always stood for Britishness and trustworthiness, supporting its objective of driving broadband-based consumer services," he adds. "But you sense that BT Sport will give the brand some of the inspiration and emotion it is striving for, and help capture hearts and minds."
BT's success is by no means guaranteed. With only 38 live Premier League games per season, plus English domestic rugby union and women's tennis, some question whether it has enough quality content to truly challenge the market-leader. Unlike Sky, which boasts live coverage of the Ashes Test cricket series and the British and Irish Lions rugby tour to Australia this summer, it also lacks exclusive properties to differentiate itself from the competition.
However, for the first time, some are questioning whether the challenge of BT - along with Liberty Global-owned Virgin Media - may knock Sky from its perch.
Alex DeGroote, a media analyst at Panmure Gordon, believes that Sky is "in trouble". He adds: "For the first time, it faces two formidable competitors. BT will use predatory pricing. The Sky business model has been based on increasing prices and this is no longer sustainable. Sky will also now face a steep hike in marketing costs."
It will be interesting to see how Sky reacts, and stands its own in the face of probably their greatest challenge yet. To find out more please call the Sky Telephone Number
.The orginial extract from this article is from http://www.marketingmagazine.co.uk .
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