Competitors circle broadcaster

Sky TV fears a major crack has appeared in its fortress around its allimportant rugby broadcast rights.

The company told investors yesterday it was not in pole position to vie for the New Zealand broadcast rights for Rugby World Cup 2019.

Negotiations are under way with the preferred party — which the Herald understands to be Spark and TVNZ — and Sky says that its bid would remain live should that fail.

Sports, particularly rugby, are seen as a keystone to the long-term viability of the country's dominant pay-TV company, which lost 28,000 customers in the 2017 financial year.

Sky is already facing fierce international competition in the entertainment space from streaming giants such as Netflix.

Live sports broadcasting is a much more expensive and complicated game — although players like beIN Sports (part of a Middle Eastern conglomerate) already offer New Zealand football fans online streaming subscriptions to the English Premier League competition.

Sky told the market yesterday morning that while it was "disappointed not to be the preferred bidder" for the Rugby World Cup, it was "an economic reality that we can't have every match of every sport that New Zealanders like to watch".

"While the Rugby World Cup is great content and we put forward a strong bid for it, it is an incredibly expensive event that plays once every four years for six weeks," Sky said.

"Sky Sport's business is built on offering sports fans their favourite matches on a week in, week out basis, over multiple years."

Sky last month confirmed it was cutting its prices and that sports fans could save $25 a month by switching to a new stripped-back basic option.

The company specifically pointed out yesterday that the Rugby World Cup rights were unrelated to Sanzaar rights, which it holds through to 2020 and include All Blacks tests, Super Rugby and the Mitre 10 Cup.

But it is widely speculated that US juggernaut Amazon could vie for All Blacks broadcast rights in coming negotiations.

Australian pay-TV firm Fetch is also considering bidding for these and while Sky is likely to be in the box seat during bidding, there's no guarantee it will emerge victorious.

Investors were delivered a sharp reminder of that yesterday.