This article has been adapted from our sister site across the pond, Fool U.K.
While BT struggles to avoid strike action, the gloves are off in the battle to sell TV and broadband packages.
For a while now, watchers of BT Group
But BT now has two fresh battles on its hands.
Currently engaged in a dispute over pay with the Communication Workers Union (CWU), which represents more than half of its total workforce, BT looked as if it was facing its first strike action since 1987, with a real danger of walkouts starting within the next week.
That action has now been put on hold after BT threatened legal action over technicalities in relation to trade union regulation, and the strike ballot, which started on June 18, has been cancelled before the counting has started. But the danger is not over. Although both sides now say they are hoping to settle their differences and avoid a strike, the union had been confident there was a majority in favor of action -- and as British Airways found out so recently, legal technicalities alone won't stop such a dispute.
Football fans
And on its other new battlefront, BT is getting down and dirty with BSkyB.
As BT is losing share in the broadband market to the satellite operator, and to cable giant Virgin Media
Last year, Ofcom ordered Sky to sell access to its prime sports channels, Sky Sports 1 and 2, at fixed wholesale prices. Currently, those two channels, on which Sky broadcasts its Premier League football coverage, are the only two it is obliged to share, and BT is taking full advantage of them by offering cheap Premier League viewing to its BT Vision customers.
The whole package
Specific markets and specific products are not what's at stake here, as the telecommunications and broadcast entertainment markets become ever more integrated and commoditized.
Like the utilities companies before them, the big three know that it is selling integrated packages of all communications-related commodities -- phone, broadband, and TV -- that is going to sort out the winners from the also-rans. And BT's TV offerings are adding serious competition to the market -- even if you can't get cable, you can now choose between BT and Sky.
This is all good news for consumers, as competition heats up and price wars become ever more bitter. But it means further erosion of BT's once-privileged position, and even more pressure on profit margins for the whole business.
And BT, still facing union unrest, and with net debt exceeding its market capitalization at its year-end in March, might not be in the best of positions to benefit from a protracted price war.
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