Satellite broadcaster BSkyB yesterday moved to quash reports it had made a £1 billion bid for exclusive Premiership League football TV rights. The satellite company still has 18 months left to run on its £743 million deal for live and highlights coverage - split with the BBC.

But the Financial Times yesterday reported that BSkyB had started the bidding for the next contract early with an informal offer of £1 billion to take exclusive coverage for the next three years.

BSkyB responded to the report with a brief statement. "Negotiations with the Premier League have not started on the next Premier League contract," a spokesman said. The FT report said the broadcaster had approached the chairmen of two leading clubs with the informal £1 billion offer.

Official negotiations over the TV rights are carried out with the Premier League itself which auctions the rights on behalf of all member clubs. The practice of selling the rights in a single block was challenged in the courts earlier this year by the Office of Fair Trading, which argued that the Premier League was acting as a cartel and each club should negotiate separately to sell TV rights to its matches. But the Restrictive Practices Court threw out the Office of Fair Trading's complaint.

TV industry observers suggested the latest report of an early BSkyB bid could have been prompted by football clubs trying to ramp up the price of the TV rights by sparking off an early bidding war.

BSkyB needs to retain the contract for live coverage to keep up the momentum in its satellite subscriber numbers as digital TV takes off. But the rival digital broadcaster ONdigital - owned by Carlton and Granada - is also expected to bid, along with leading cable TV company NTL and the other terrestrial broadcasters BBC, ITV, Channel 4 and Channel 5.

Negotiations over the next Premier League TV contract are expected to begin in the next few months.