B T Sport has agreed a four-year extension to its deal with the specialist producer sports Sunset+Vine, in a move that cuts costs and secures coverage until its latest football rights deal with the Premier League expires.
Sunset+Vine will continue to produce Premier League and Europa League football, as well as Aviva Premiership rugby, until 2022. An agreement is expected to be confirmed by the two sides tomorrow.
The new contract for 1,200 hours of live coverage per year also includes production work on new rights acquired by BT Sport, such as the Australian cricket competition the Big Bash.
It is understood that BT squeezed Sunset+Vine for lower costs in exchange for the certainty of a four-year contract. The previous extension lasted only two years.
The relationship accounts for around a third of Sunset+Vine revenues, which were ?54m in 2016, the most recent year for which accounts are available. Its parent company, Tinopolis, which also makes Question Time for the BBC, was last year bought out of private equity ownership by its management.
BT first appointed Sunset+Vine soon after its surprise raid on the Premier League auction in 2012. It had to create a full broadcasting infrastructure within months to challenge Sky Sports. Sunset+Vine now employs around 80 people at the BT Sport headquarters at the Olympic Park in East London.
The production deal has been renegotiated amid a major shift in BT's television strategy.
It signed a deal with Sky last year to supply its channels to satellite homes wholesale and resell Sky Sports in return as part of BT TV. The move neutralised the rivalry between the two going into the triennial Premier League rights auction in February and meant the cost of top flight football rights did not sharply increase.
From 2019 BT will pay ?295m a year for 32 matches per season, compared with ?320m for 42 matches under its current deal.
After a torrid 18 months BT is attempting to regain momentum with an overhaul of its consumer packages to combine mobile and broadband as a single connectivity service.
BT Sport is due to be deployed as a way to retain subscribers and encourage them to upgrade more expensive data packages. By 2022 the company will have spent around ?5bn on sports rights.