BskyB have signed one of the most potentially wide-ranging commercial deals to ever hit the computer industry with internet giants Google.
British Sky Broadcasting currently providing satellite TV to over 7.5 million customers have come under increasing threat from talks that the NTL Telewest partnership will finally throw Sky off the top spot that they have enjoyed for so long. Increasing talks now about the partnership of BT with Irish international sports provider Setanta Sports means that Sky will need to get ahead of the game as quickly as they can. Who better to join forces with than Google, a company almost solely responsible for the technological progression of the world wide web today.
Sky bought the Broadband provider ‘Easynet’ in October 2005, for £211 million. This acquisition has allowed BSkyB to compete with the “triple play” TV, Telephone and Broadband services offered by rivals NTL and Telewest. However, this hasn’t proven to have worked 100% as planned. Currently only 28% of UK households are covered by Sky’s broadband network but it is hoped that this will be increased to 70% by the end of next year.
Although the plans that this merger will bring are not 100% finalised or released, it is thought that Sky will offer a Sky-branded but Google-operated search portal with mail and video services. Google will also provide advertising on the site, with the companies sharing the revenue derived from each click.
Sky will also hope to be launching a user-generated video portal using Google’s video content tools, which will enable users to edit, upload and share their own videos.
The deal could become even more far-ranging, with the two companies examining “future forms of web, TV and mobile advertising”, which could eventually see Google selling TV advertising and using the information about viewing habits that can be obtained through the satellite broadcaster’s set-top boxes to produce more targeted TV ads. The two may also launch a product which would enable users to make telephone calls over the internet, using a customised version of Google Mail.
BSkyB have announced that they already have had one million registrations for Sky broadband since it was launched in the summer but expects to attract two million more subscribers by the end of 2010.
“These agreements will bring Sky customers a valuable set of services from the world’s leading search company, including cutting edge tools for video sharing and communications,” chief executive James Murdoch said.
For Sky, the deal with Google will enable the offering of high quality services far faster than if it had to develop them itself.
For Google, this is only the beginning as an ever increasingly powerful company, gets bigger and bigger
Is Google getting too big? -Talking point of the day.
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