BSkyB says it wants to pay less money to MTV to carry its channels on Sky Digital - but has denied threatening to throw its music services off digital satellite.

The satellite broadcaster pays MTV a lucrative cut from subscriptions for its eight channels, in a deal which dates back to Sky Digital's launch.

Now it has 6.6 million subscribers, the deal is thought to cost BSkyB £20m a year - a figure it wants to see slashed.

Launching its latest set of financial figures, the company's chief executive Tony Ball said it was determined to cut its costs.

MTV'S CHANNELS

MTV UK and Ireland MTV Base MTV Dance MTV Hits MTV2 TMF - The Music Factory VH1 VH1 Classic

"We're definitely prepared to stare them down if we can't get a sensible deal," he told reporters.

A BSkyB spokesman confirmed to BBC News Online the company could drop MTV from its subscription package, but said it could not drop MTV from digital satellite altogether.

"We cannot throw them off the platform but we have an opportunity to reduce all programme costs across all channels so we will be renegotiating their deal," said a spokesman for Sky.

"MTV, and other channels, have done particularly well out of the growth of Sky but the opportunity for savings is now there and Sky will be taking it," he added.

"MTV has done extremely well out of that original deal," the spokesman added.

"Now we are looking to make a deal that is mutually beneficial."

BSkyB is planning to launch its own range of music channels this year, which would put MTV's channels - which include MTV UK and Ireland, MTV Hits, MTV Base, MTV2, and VH1 - under more pressure.

Already, their ratings have suffered thanks to competition from rival channels like The Box, Smash Hits, Kerrang TV, and The Hits, which are owned by media group Emap.

MTV could broadcast independently of Sky if it were not happy with the terms of the renegotiated deal.

But this would mean losing out on subscriptions from Sky users - and Sky could move its channels to a less favourable position on its electronic programme guide.

MTV is one of the oldest satellite broadcasters in the world, and helped pioneer satellite TV in UK in 1989 when MTV Europe was launched.