BT has admitted that it will lose money on its Sky Sports offering in its online TV service as a result of BskyB's wholesale price increase.
The price increase was "bizarre", BT Retail chief executive Gavin Patterson told the BBC, adding that BT would profit from the service in the long term. But BT Vision will lose money on every new subscriber it picks up at present prices.
BskyB waited until BT Vision today announced its prices for the new sports channels before raising its price to the would-be online broadcaster.
BT Vision is offering new subscribers Sky Sports 1 and Sky Sports 2 for £16.99 a month. Existing customers can add either channel on a month-by-month basis for £11.99.
Customers who take a bundle that includes broadband and voice calls could save up to £205 a year on Sky's equivalent deal and £281 on Virgin Media's package, the firm said.
Compared to its continental peers, BT has been relatively slow to move into the online TV market. The BT Vision customer base was 467,000 at 31 March 2010, but the average number of subscription views per month per subscriber rose 37% over past year, to 40.