Setanta holds the rights to screen 46 Premiership football matches per season for the next three years, starting this August. Last summer the Irish broadcaster won the rights to the PGA golf tour, breaking Sky's 10-year hold on the event.
A sports channel from Setanta and Virgin would be a powerful salvo in the public rivalry between Virgin and Sky.
Sky pulled Sky Sports News and Sky One, Two and Three from the Virgin Media platform earlier this month following a dispute over retail fees.
Virgin Media replaced Sky One at the beginning of March with its Virgin Central 2 video-on-demand channel, which offers shows such as Nip/Tuck, Little Britain and Spooks. From August the service will offer all three seasons of Lost.
Virgin Media and Setanta were among the firms which complained to regulator Ofcom earlier this month over alleged anti-competitive behaviour by Sky.
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