Should we allow this man to buy up sport?

BSkyB is under fierce attack. In a rare interview with Mathew Horsman, its head, Sam Chisholm, defends his strategy
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The Independent Online
Sam Chisholm hardly ever speaks in public. Even in his legendary phone calls to journalists who write things he does not like, the ticking off - in colourful language punctuated by the odd howl of rage - is prefaced by the warning: "This is off the record; don't you dare bloody use my name." But yesterday the chief executive of BSkyB, a multi- millionaire New Zealander and Rupert Murdoch's top television executive outside the US, was all smiles, all charm, and ready - no, wanting to be quoted.

The uncharacteristic welcome granted the Independent at BSkyB's low-lying, modern modular headquarters in Isleworth, west London, had more than just a social purpose. For perhaps the first time, Mr Chisholm is behaving as though he believes that the Government may really be gunning for Sky, Britain's leading pay-television company and the dominant broadcaster of sporting events.

Envious rival broadcasters and backbench MPs from both sides of the House of Commons routinely demonise Sky as monopolistic, anti-competitive and a scab on the body cultural. With the new Broadcasting Bill making its way through Parliament, they have been given a chance to act. This week, cross-party support emerged for an amendment to the Bill which would provide greater protection for "listed" events - including the Grand National, the FA Cup, the Derby, England cricket, the World Cup and Wimbledon. Current legislation prohibits the broadcast of these events on pay-per-view television. The politicians now want to keep them off subscription television, too, a prospect that worries Sky.

The extent of parliamentary support for the amendment is striking. Both the Conservatives and new Labour have been cautiously courting Mr Murdoch, aware of the power he wields through his stable of British newspapers. But here at last was a simple, straightforward issue on which simple, straightforward politicians could agree: sport is part of the lifeblood of the nation and ought to be widely accessible. Football - at least the big matches - is not like any old commodity, bought and sold according to the cold, hard market. It is a cultural event, a defining facet of our national identity, and in need of special protection.

That this holds true in the main only for men, and that regional and class differences weigh heavily in the degree of affection Britons feel for the "national" sport seems not to have been much discussed. Forgotten, too, is how much Sky has already done for football: better match coverage, superior technology for replays and commentary and - crucially - more money for the owners of the leading clubs. And overlooked is the fact that Sky provided 9,500 hours of sport last year, 3,000 of them live broadcasts - dwarfing the schedules of both ITV and BBC.

All these facts were tossed aside this week. Instead, many MPs are fretting about how national sport is too important to be left wholly to the market, and worrying about the influence that television can have on the very fabric of the games - from switching Rugby League from a winter to a summer game to suit broadcasters, through to changing the timing and length of matches to accommodate advertising breaks.

Thanks to sport and film, Sky has become the country's most profitable broadcaster. Hollywood films and top sporting events such as the Premiership and golf's Ryder Cup have driven satellite dish sales to more than 4.6 million and fuelled subscriptions to Sky's multi-channel package, providing BSkyB with nearly pounds 1bn a year in operating profits. Without these two types of programmes that people have shown themselves willing to pay for, Sky is an unappealing mix of American imports, standard news, and cheap "lifestyle" and entertainment programmes.

In the battle to ensure that market forces, rather than government interference, dictate the economics of sport on television, Mr Chisholm has lined up an impressive list of allies. Among them are the leading officials of virtually every professional sport. "What you have to ask is what is good for the sporting community," he says. "Just ask them whether they want the old BBC-ITV monopoly or real competition for rights. Sky is the best thing that has ever happened to British sports."

Hear, hear, say the Football League, the Premiership, professional rugby, even cricket. And why not? As David Dein, vice-chairman of Arsenal Football Club, points out, broadcast rights to the next five years of Premiership football are likely to spiral to at least pounds 500m, a far cry from the paltry sums (as low as pounds 3m annually) formerly paid by the two traditional broadcasters, BBC and ITV, in the days of the duopoly.

BSkyB is hitting hard. On Wednesday, it sponsored an industry seminar that pitted sporting organisations against politicians. "We have nothing against a voluntary list of events," said David Elstein, Sky's director of programming. "We don't believe it should be legislated against the wishes of the sporting organisations themselves." In other words, Mr Elstein wants the list dropped altogether.

He makes one incontrovertible point though: the list is out of date and inconsistent: "Why protect the Grand National and not the Cheltenham Gold Cup? Why the FA Cup but not the League Cup?"

Mr Chisholm scoffs at complaints from politicians that Sky's control of important televised sporting events means fewer highlights on mainstream television. "We made it possible for the BBC to revive Match of the Day," he says. "We have also shared the rights to Football League matches." He accuses one of Sky's chief critics, the BBC, of caprice: "We went to the BBC and asked for the rights to highlights of the Atlanta Olympics. They said no, we won't share them with you."

Intransigence by public service broadcasters here and on the Continent was the main reason why News Corporation, BSkyB's controlling shareholder, bid $2bn for the European rights to the Olympic Games between 2000 and 2008. "We have given firm undertakings that the games would have a wide viewership," Mr Chisholm says. "If News Corporation managed to buy the Olympics, there would certainly be coverage on terrestrial television."

The BBC complains that it cannot compete against Sky's deep pockets. But Mr Chisholm finds this astonishing, given how much bigger the BBC's overall budgets are: "If the BBC wants to increase sports programming, it should reallocate spending from other strands. It competes in the marketplace for Noel Edmonds, so why not for sport?"

Time, he believes, is on his side: "The technological revolution means more services and more competition. The only constant is change, and television is changing radically. Legislation created in the Fifties is anachronistic."

Anyway, within a decade, he and his senior executives hint, the BBC will be unable to justify the licence fee and will be forced to compete openly, accepting that the creeping commercialisation which already characterises some of its operations under John Birt will have reach the logical conclusion: privatisation.

In the short term, the list of protected events may well be strengthened and politicians will be content. But for them simply to concentrate on sport, when BSkyB's pay-TV stranglehold has more to do with technology, access to satellite capacity, its control of billing systems and its exclusive deals with programme suppliers, is to miss the point.

It misses, indeed, an even bigger point: the changing nature of British society. We no longer all watch the same programmes, nor do we even share the same view of the nation. Television may be fragmenting, but then so are our communities and our sense of how we relate to politics, culture and each other.

More prosaically, constraining the market for sport rights is commercially short-sighted, and not just from Mr Murdoch's perspective. "We don't want to limit the possibility of bidding for sport rights on our own account," a rival senior television executive says. "Our real problem is with Murdoch's monopoly, and listing events isn't going to help."

If Sky is truly acting as a monopoly, competition policy ought to provide a remedy. The Office of Fair Trading is looking at such issues and expects to make a ruling later this year. Pressure from that quarter will do far more to restrain Sky's hold on pay-TV than any single-issue protectionism. But Mr Chisholm is not taking chances and will fight the politicians all the way: "They are wrong, and we can show it. We are a force for good. We have already shown what we can do with football; we can and intend to do the same with other sports."