The possibility of Virgin Media taking Sky on in the sports arena further fuels the rivalry between the two broadcasters after Sky pulled Sky Sports News, Sky One, Sky Two and Sky Three from the Virgin Media platform earlier this month.
It is not yet clear if Setanta will supply premium sports content for the as-yet-unnamed news channel.
Setanta controls the rights for 46 Premier League matches a season for a three-year period starting with the 2007-2008 season. It also controls the rights to broadcast the PGA Tour, which it won from Sky in June, breaking the broadcaster's 10-year hold on the event.
In February, Setanta claimed it would offer Freeview viewers its live sports package for £10.99 a month, which will include Premiership football, allowing it to challenge Sky's dominant position in the UK pay-TV sports market.
Virgin Media said it would take on Sky by offering a new package of Sky Sports 1, 2 and 3 and Sky Sports Extra, along with 39 other digital television channels including E4, CBeebies and ITV2 for just £26 a month, undercutting Sky. The Sky Sports offer is open to anyone with an £11 Virgin Media phone line.
The broadcaster said that an equivalent package from Sky, based on its basic TV package with Sky Sports and a BT phone line, costs £45 a month.
Sky hit back at the claims, saying that its £34 a month package would offer the chance to enjoy subscription-free broadband and free UK evening and weekend calls whereas the nearest equivalent set of products from Virgin would cost £70 a month. When the cost of BT line rental is taken into account, this represents an annual saving of £285, Sky claimed.
Virgin Media replaced the pulled Sky One channel with its Virgin Central video-on-demand service, which now transmits on channel 120. Virgin Central offers shows such as 'Spooks', 'The Office' and 'Alias'.
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