Sky HBO deal signals major new drama

THE latest blockbuster TV drama could be filmed in Britain after Sky struck a production deal with US studio HBO.

HBO, which is behind hit series such as Game of Thrones and The Sopranos, already broadcasts its dramas on the Sky Atlantic channel in the UK. Now the pair have signed a ‘co-production agreement for major new drama’, which Sky chief executive Jeremy Darroch said could see big-budget series shot in Britain.

Financially, Sky counted the cost of doing battle with BT over sports rights as its half-year revenues rose but profits fell. It has fought back against BT’s move into its territory with higher spending on adverts and games.

The group has also faced fierce competition in the home broadband market from low-cost rival Talk Talk.

Pre-tax profits fell 18pc to £527m – better than analysts had expected – and shares rose 5pc to finish 40.5p higher at 885p. Revenues rose 6.3pc to £3.8bn with the growing trend of watching DVD boxed sets and films on demand, especially in the run-up to Christmas. Despite squeezed budgets, customers also stumped up for high-definition packages, the group said. Connections to its Sky+HD boxes were up 1m in the second quarter to 4.4m, and it saw a threefold increase in On Demand use.

The broadcaster saw customers take up 873,000 new products or deals, such as HD TV and broadband, in the second quarter, which includes Christmas, beating market expectations of 731,000.

Darroch also used the results day to warn about the growing size of the BBC, which he said was ‘clearly a big intervention in the market place’.

He added: ‘It’s an extremely wellfunded public sector organisation and needs to think carefully about its footprint, about where it serves parts of the market that commercial services cannot pick up.’