Football fans to pay less for live matches in BT-Sky price war

BT Vision has announced it intends to charge 15 for Sky Sports 1, compared to Sky's current charge of 27.

Virgin, however, has said it too has plans to undercut Sky later this year.

The moves would mean the public could watch Scottish and English Premier League football, Rugby Union, Test cricket and PGA golf for almost a third less.

The announcements come as Ofcom, the communications regulator, is expected this week to rule that Sky will have to cut the wholesale price of key channels, including Sky Sports and Sky Movies.

The regulator will announce its decision, which follows a consultation that recommended slashing Sky's wholesale rates by as much as 20 per cent.

However, BT Retail chief executive Gavin Patterson said yesterday that it expects to start charging just 15 a month for Sky Sports after the announcement: "The case is crystal clear – the customer benefits if they get more choice."

Both Virgin Media and BT have struggled to compete with Sky in the pay-TV market. Across the UK, Sky has 9.5 million customers, while Virgin has 3.7 million and BT Vision 436,000.

Currently, Virgin Media is the only rival company to offer Sky channels to customers; however it does so at a loss. A spokeswoman for BT Vision said: "We haven't offered Sky Sports to date as we've never been offered realistic commercial terms."

Ofcom's investigation into the market began after Virgin, Top-Up TV, which makes premium channels available to Freeview customers, BT and Setanta complained in 2007 about Sky's dominance.

Neil Berkett, chief executive of Virgin Media, told The Scotsman: "Ofcom's proposals are about creating a competitive market in which consumers aren't harmed by Sky's ability to charge unfair prices or manipulate the distribution of its sport and movie channels.

"Ofcom's solution could bring premium film and sport to millions more people at much lower prices. We support Ofcom's proposed action to remedy this market failure."

However, Jeremy Darroch, Sky chief executive, has reacted angrily to what he claims are BT and Virgin's attempts to profit from Sky's success.

"BT and Virgin Media do not deserve to be handed a reward at Sky's expense for their repeated failure to invest," he said. "It defies belief that Ofcom expects Sky to lower its wholesale prices to compensate for the higher cost of less efficient platforms. Sky invests and takes risks to create television channels of the highest quality."

Ofcom's consultation proposed cutting the wholesale price of Sky Sports 1 from 13.48 to between 9.41 and 11.24. Some sporting bodies, including the English Premier League, have complained the move could impact on the sport through a knock-on cut in the price Sky would pay them for the rights to televise matches.