Promotions are Sky's new arena

STEVE KILGALLON
Last updated 10:20 23/02/2014

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Sky Television is going from screen to stage, unveiling plans to become an events promoter and promising to attract big-name musicians, champion boxers and the fast-growing UFC cage-fighting championship to New Zealand.

Sky has spun off a new company, Sky Arena, which will not just screen pay-per-view shows, but also own them. Sky chief executive John Fellet admitted promoting held some risk, but said: "We don't take a risk unless we think we will get rewarded."

It plans to livestream music gigs from Auckland's Vector Arena and the launch event will be a heavyweight boxing tournament in Auckland on June 4 for which it has pledged $500,000 prize money.

Among the Sky Arena team is John McRae, a former director of event organisers Duco which promoted the Auckland Nines, Fight for Life and the Shane Cameron-David Tua boxing match.

McRae has served a two-year restraint of trade after quitting Duco but said he remained on amicable terms with former partner David Higgins, who now runs Duco with Dean Lonergan.

Traditionally, Sky has split pay-per-view sales 50-50 with event promoters; the 88,000 sales generated by Tua-Cameron (still a New Zealand record) turned a huge profit for McRae and Higgins.

Sky Arena will be headed by senior Sky TV executive George McFarlane, McRae and, as spokesman, Mark Keddell, a former Olympic athlete, boxing manager and chief executive of hospitality chain Pack Group.

Fellet said the move was prompted by a belief it would soon be possible to access the biggest drama shows in many ways, so broadcasters would get their biggest audiences from "local and live" content.

He cited local shows like Masterchef, New Zealand's Got Talent and the fact Auckland's two big tennis tournaments, broadcast live, drew larger TV audiences in New Zealand than Wimbledon.

Music-industry changes were another trigger: declining album sales meant record companies were now cutting "360 degree" deals with bands to take ticket-sales and merchandise revenue.

Televising shows was another revenue stream. Technology commentator Peter Griffin said Sky was definitely entering new ground but it was a move that made sense.

He pointed to the launch on Friday of Telecom's online-only TV service which he said posed a "major threat" to Sky for overseas rights, while it was only a matter of time before popular streaming services like NetFlix arrived here.

The "local and live" idea was one way to combat that and the possibility of more tech-minded viewers "cutting the cord" and relying solely on online viewing.

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"There is a risk involved . . . if an event doesn't sell well or a band cancels," Griffin said. "And do Kiwis really want to sit on their couch and pay to watch a concert streamed into their homes?"

Fellet said big acts were now consistently selling out Vector, creating a market for pay-per-view audiences. McFarlane said Sky had run consumer surveys showing viewers were willing to pay to see acts like the Rolling Stones and Bruce Springsteen.

If promoters weren't booking the bands Sky wanted, it would consider doing the whole event themselves. Griffin said this followed a trend of companies wanting into the "live events" market.

TV3 declined to comment on Sky's plans, or whether they would consider anything similar, instead pointing to their broadcasts of sponsored local events like the annual Comedy Gala and Music Awards.

McRae said promoters would be more likely to consider the 10,000-capacity Vector against bigger Australian arenas when television income was factored in.

Arena would also look to book and televise comedians and musicals, and take events to other centres such as Queenstown.

Fellet said the steady levelling out out of Sky's reach into New Zealand homes wasn't a factor, instead it was a belief that people were willing to pay extra for special content. "We would be doing this whether we were at five per cent or 98 per cent [of market share]," he said.

Sky will also help "promote" the affairs of key sportsmen, but won't become a formal player agent.

It has already recruited New Zealand's leading cage-fighter, Mark Hunt, saying it can boost his profile. Hunt is well-known in the US, less so here, but his sport has a big pay-per-view audience and growing popularity with the youth market.

Fellet said the aim was straightforward: "Hopefully, when you go to the electronic programme guide you go straight to see what they've got coming up on Arena - that would be the goal."

- Sunday Star Times

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