Pubs pull plug as Sky puts up prices

BSkyB is planning to hike its prices for satellite TV in pubs and clubs, prompting cuts in the number of venues showing live football.

The price rise is believed to be the first big increase since the Office of Fair Trading halted an investigation into Sky's pub pricing last August, due to lack of evidence.

Prices will increase by between 8 and 22 per cent for licensed premises from September. In response, West Midlands-based Wolverhampton & Dudley Breweries will cut the number of pubs showing Sky from 280 to 190, while Yates's Wine Lodges will reduce its venues from 50 to 10 from August.

Mitchells & Butlers, the bar chain that owns the O'Neill's and All Bar One brands, is re-evaluating the use of Sky in the 600 of its 2,100 outlets that use the service.

Sky is shown in around 30,000 pubs and clubs in the UK, each paying as much as £1,000 a month. "A number of companies have reduced their outlets with TVs already, because prices charged meant ... it was uneconomic," said Rob Hayward, the chief executive of the British Beer and Pub Association. "More pubs [will be driven] to withdraw their TV screens when confronted with an increase of seven times inflation."

The trade association strongly criticised Sky's pricing strategy in its submission to the OFT, claiming prices for pubs had risen by between 224 and 625 per cent in the five years to 2001.

A spokesperson for BSkyB said the price rise "reflects the quality we offer [customers] as part of our package." He pointed out that the company will soon be showing 14 Uefa Champions League matches every week, on top of a large range of sports events.