Sky and Discovery Negotiations – BATNAs, Tennis and a Win:Win Twist

Did you know just how close we came the other day to losing “Say Yes To The Dress” from our screens? Not to mention serious tennis tournaments, and Cake Boss?

An argument led to threats that Sky subscribers (including the Smith household) would no longer be able to watch programmes on 12 channels owned by Discovery UK, including Eurosport and TLC.  Given a certain happy event in the wider Smith family recently, the “Say Yes To The Dress” (or SYTTD to its fans) issue was perceived as being particularly shocking.

Sky says that Discovery backed down and accepted an offer they had previously rejected. Discovery responded; "The deal we reached with Sky is meaningfully better than our former agreement and their proposal. Furthermore, our new arrangement enables us to control our destiny in more ways, with even more opportunities to invest and launch channels and consumer services."

So clearly the settlement gives both parties the opportunity to look good – which is a positive way of ending a negotiation in most cases. It also demonstrates some of the classic negotiation principles, and another somewhat unusual aspect of this case.

The usual point is that both parties clearly worked to develop and present their BATNA (best alternative to a negotiated agreement) in a positive light, to try and ensure the other party saw their rival as being in a strong position. But the interesting aspect was how Discovery in particular tried to weaken Sky’s BATNA and position by appealing to Sky’s own customers.

If you watched the amazing Australian Open tennis, with Roger Federer and the Williams sisters turning back the clock, you will have seen and heard constant messages about the forthcoming loss of Eurosport to Sky viewers. Discovery were trying to weaken Sky’s BATNA and resolve by bringing pressure to bear on Sky via the viewers. So that is an interesting angle – in your negotiations, think about whether you can use a third party, or even your opponent’s customers, to influence the negotiation.

The other point that struck us as interesting, and again, like the positive statements both sides issued,  feels like a positive “win:win” factor ultimately, is the manner in which the dispute may have created value for both parties.

It is clear that many viewers appreciated what they might lose, whether that was amazing tennis from probably the greatest male and female players ever or a girl crying because her mother thought the wedding dress she liked made her look “cheap” (that is plot-line number 3 on SYTTD).

Sky subscribers may have realised more clearly the breadth of programmes available, and felt more positive about their £50 a month (or more) in fees. And for Discovery fans, it hit them in terms of just how much they would miss the tennis, the dresses, the cakes … so through the publicity around the dispute, more value was created in the minds of the ultimate customers, benefiting both parties.

Indeed, the cynic might almost suggest the whole thing was staged for our benefit … but we couldn’t possibly comment!

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