BT is in talks that could lead to the sale of its sports business, it admitted on Thursday, a move that could help pay some of the upcoming bills at its core telco operation.

“Further to media reports, BT can confirm that early discussions are being held with a number of select strategic partners, to explore ways to generate investment, strengthen our sports business, and help take it to the next stage in its growth,” the UK incumbent said, in a statement.

It added the usual caveat that the talks may or may not lead to a deal.

There are a number of possible options open to the telco, including an outright sale of BT Sport, a partial sale or joint venture agreement, or brokering an investment deal of some sort.

Sources cited by the Financial Times said BT has appointed investment bank Lazard to advise it, and has held initial discussions with a number of big media names Amazon, DAZN and Walt Disney, as well as private equity companies. Interestingly, DAZN’s new chairman Kevin Mayer – formerly a high-flying Disney executive – recently indicated an interest in Premier League rights, amongst others, in an interview with CNBC.

BT’s carefully-worded statement doesn’t tell us a lot about its preferred course of action. An outright sale would doubtless provide the telco with a sizeable lump of cash that will look particularly attractive at a time at which it is focusing on the rollout of EE’s 5G network and building out its own fibre broadband business. But a full exit from the sports scene would be a real back-to-basics statement from the operator. A partial sale and partnership deal would allow it to keep a foot in the premium sports content space and let’s face it, content is still king.

Much like the monarchy, content costs. A lot, if you’re talking top-end sports rights. For BT the heavy spending started almost a decade ago when it secured a package of Premier League football rights for £738 million, setting itself up as a competitor to dominant player Sky and pushing out ESPN, owned by Disney, incidentally. Soon after, BT hoovered up football rights from overseas leagues and bought ESPN’s UK and Ireland business, picking up more sports rights in the process.

Its wallet has been open ever since. Retired football stars flocked to BT Sport in their droves, the marketing was extensive, and of course there have been other rights auctions in the intervening years. The FT quotes Jefferies analyst Jerry Dellis as saying that BT Sport costs the telco around £800 million a year – largely due to football rights – but that it has struggled to define how the broadcasting arm creates value for the business.

It wouldn’t be the only telco to back away from an expensive portfolio of media assets. The Wall Street Journal this week reported that Verizon is exploring the possible sale of digital media assets including Yahoo and AOL, putting the value of such a deal at US$4 billion-$5 billion. That’s a different proposition to BT Sport but the upshot is the same: spending big on something that doesn’t bring value to the core business.

So maybe it is the right time for BT to sell, to let Gavin Patterson’s legacy go up in flames, as one industry commentator I spoke to put it.

The UK press has been awash with reports in recent days that the current Premier League rights could simply roll over, despite the fact a new auction for the 2022-2025 period was due imminently. The thinking is to provide more certainty in the wake of the pandemic –  the suspension of various sports competitions last year was tough on broadcasters – but there have also been reports that the formerly big spenders like BT and Sky were likely to reduce their spending in any rights contest compared with previous years.

It is not just in the UK that the cost of content rights appears to be cooling. The French football governing body earlier this year failed to sell off a package of rights as bidders failed to meet its reserve price. That is an ongoing and complex saga, but the indications are there that top flight football rights are no longer a licence to print money.

The short-lived European Super League (ESL) debacle also backs up that theory to an extent, although you could argue that for Europe’s top football teams – or rather the owners thereof – no amount of cash will ever be enough.

With rights costs looking to be on the way down, it could appear premature for BT to look to sell its sports business. Conversely, the promise of lower overheads will likely appeal to would-be buyers and investors. With big bills looming on the telco side of the business, perhaps there’s no time like the present.