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Sky Network abandons guidance

Sky Network Television has dumped its annual revenue and earnings guidance because of the increasing uncertainty over the coronavirus outbreak.

The NRL is one of Sky’s key broadcast properties in New Zealand. Picture: Getty Images.
The NRL is one of Sky’s key broadcast properties in New Zealand. Picture: Getty Images.

Sky Network Television has dumped its annual revenue and earnings guidance because of the increasing uncertainty over the coronavirus outbreak, which has already hurt sporting events for which the New Zealand pay-television and streaming company holds broadcast rights.

The group joins outdoor advertising firm oOh!media to abandon its guidance because of the coronavirus this week, but is the first sports rights holder within Australia and New Zealand.

In a statement, Sky said the "responsible actions taken by the New Zealand Government and sports administrators to combat the spread of Covid-19 has impacted upon a number of the live sporting events for which Sky holds broadcasting rights".

While several sports, including the National Rugby Leauge, the A-League and the ANZ Premiership Netball are currently playing behind closed-doors with no spectators, and New Zealand Rugby is looking at "innovative ideas for a short-term local derby, Sky recognises the potential for further disruption".

Sky said it has "options to recover some costs associated with sports content rights", it is aware of the crucial role it plays in the sport ecosystem in New Zealand.

"Decisions made now have the likelihood of impacting on the health and sustainability of New Zealand sport for some years to come. As a business with a strong focus on delivering sport content to its customers, the sustainability of New Zealand sport is an important consideration," Sky said in a statement.

Chief executive Martin Stewart said during the unprecedented times, the group's "focus remains on working with our sport partners and the wider network of rightsholders and suppliers to deliver on our promise of connecting New Zealanders with the sport and entertainment content they love in ways that work for them".

Sky said it is working closely with its content partners to develop "the best possible package", with access to "draw upon its extensive library of marquee sporting events covering a range of codes and tens of thousands of hours of premium content, documentaries and original production".

On the flip side, Sky said its entertainment line-up, which is available through its satellite platform and Neon and Lightbox streaming services, continues to deliver a "high-quality line-up of content" as people stay home during the global health crisis.

In response to the coronavirus fallout, Sky is cutting operating expenses and deferring non-essential capital projects. The group has also introduced a travel and hiring freeze, and plans to host an investor day when the Covid-19 impacts are better understood.

A spokesman for pay-TV and streaming group Foxtel, which also owns sports streaming platform Kayo Sports, said it is too early to comment on the coronavirus impact on the business, as the situation is still unfolding.

Corin Dimopoulos, head of TV and content at telecom company Optus - which operates a sports streaming service called Optus Sport - said the majority of professional sports have put their competitions on hold, including some that are currently impacting its customers. Optus Sport’s marquee event is the English Premier League, which has been suspended until later this month.

“We understand this could this could be disappointing for some of our customers, but we respect the decision given current concerns around COVID-19,” he said.

“We will always do the right thing by customers and we are closely monitoring events. Once we have a clearer indication of the plans from the Premier League, FA, UEFA and the J-League, we will be in a better position to provide our customers with a range of options so they can choose the one that works best for them.”

Sky has no relation to Australian 24-hour news channel Sky News Australia, which is owned by Australian News Channel. ANC is a division of News Corp Australia, publisher of The Australian.

Foxtel counts News Corp, publisher of The Australian, as its biggest shareholder with a 65 per cent stake. The remainder is owned by telecom giant Telstra.

Lilly Vitorovich
Lilly VitorovichBusiness Homepage Editor

Lilly Vitorovich is a journalist at The Australian, producing and editing business stories. Lilly joined The Australian in 2018 as media writer, covering corporate and industry news. She started her career in Sydney, before heading to London to work for Dow Jones Newswires and The Wall Street Journal. She has been a journalist since 1999, covering a broad range of topics, including mergers and acquisitions, IPOs, industry trends and leaders.

Original URL: https://www.theaustralian.com.au/business/media/sky-network-abandons-guidance/news-story/ee3717463d547789d95b6ea36e63fa10