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Eleven Sports takes on Sky and BT with IMG-backed UK channels

FILE PHOTO: Football - Soccer - Juventus v Udinese - Italian Serie A - Juventus Stadium, Turin, Italy - 15/10/2016. Juventus' Mario Mandzukic (R) is challenged by Udinese's Felipe (R). REUTERS/Giorgio Perottino/File Photo

By Kate Holton

LONDON (Reuters) - Global sports broadcaster Eleven Sports is to launch two new channels in Britain and Ireland showing live matches from the top Italian and Spanish soccer leagues, taking on Sky (SKYB.L) and BT (BT.L) in the race for viewers.

Eleven Sports delivers upwards of 30,000 live hours per year to more than 17 million paying customers in markets including the United States, Singapore, Myanmar, Italy, Poland and Portugal.

Led by the former head of TV at BT, Marc Watson, Eleven Sports has also agreed for the global sports, events and talent management company IMG to take a minority stake in its new British channels.

By securing the rights to the likes of Juventus versus AC Milan in Britain, Eleven Sports is taking on Sky and BT which have battled each other for years to sign up sports viewers, and cross-sell them other services such as broadband and TV.

Matches in Spain's La Liga had been shown by Sky, while BT had shown games from Italy's Serie A.

"The time is right for a new entrant," Watson told Reuters. "We've made a great start with two of the biggest leagues in the world and we'll be the only place to see matches like El Classico," he said, referring to the showdowns between Real Madrid and Barcelona.

The ownership of sports rights has become a key battleground for media companies in recent years, as it proves one of the few types of content that consumers will subscribe to in a world of cheaper online streaming via Netflix (NFLX.O) and Amazon (AMZN.O).

In 2015, Sky and BT stunned their investors when they paid a record 5.14 billion pounds ($6.8 billion) to show English Premier League soccer matches over three years, forcing them both to cut costs elsewhere and miss out on other rights.

When the most recent rights auction came around this year, they paid less for their new packages, against expectations of a further hike. They have also agreed to share content by making their channels available on each other's platforms.

"The appetite for the local players to hold all of the available sports content exclusively has reduced and the appetite to spend ever-increasing amounts of money on sports content has also reduced," Watson said.

"Because of that, rights fees have started to fall in the UK. That has created opportunities for players like us to come in and buy rights for what we consider to be a good price."

Eleven Sports, founded by its chairman Andrea Radrizzani who also owns English soccer club Leeds United, will make its two channels available from August. Customers will be able to agree an annual subscription or pay per month.

The channels will be available online, and the group is in talks with all the distribution platforms from pay-TV to mobile phone groups to carry them. Watson said the group has won other content but was not yet ready to announce it.

($1 = 0.7564 pounds)

(This story Changes headline to show IMG is only backing UK channels)


(Editing by Mark Potter)