BT cranks up Sky price war in 'crucial' year for UK TV

BT moved closer to launching a price war with BSkyB, saying it could undercut the subscription for Sky's sports channels by £10 a month. It added 2010 was a "crossroads" for TV in the UK.

Marc Watson told The Independent after he became head of BT's TV operation last July that he wanted to bring Sky Sports to BT Vision customers at a lower price. The group has now revealed it plans to charge £15 a month for Sky Sports 1, compared with the £25.50 that Sky currently charges.

The issue is back in focus as Ofcom, the media regulator, moves closer to a ruling in its pay-TV review. The body is understood to be meeting this week and it is expected the review will be discussed, even though it will not make a public announcement on its decision until March. BT and rival Virgin Media, which also plans to cut the costs of sports subscriptions, hope Ofcom will follow through with its preliminary findings that Sky should reduce by up to 30 per cent the prices at which it wholesales the sports content to its rivals. That would allow them to cut the costs for their customers. Those plans could, however, be delayed as Sky is expected to appeal against Ofcom's decision if it is unfavourable. This could dash BT's hopes to offer Sky's sports channels by the start of the next football season.

BT believes 2010 will be a "crucial" year for TV, saying it "could change out of all recognition". A spokesman for the group said the approval of Project Canvas – the joint initiative to bring internet television into the living room – would be the key factor.

"This year is the crossroads. We can either go the right path with properly priced sports and internet TV, or the UK risks falling behind," he added.