Oh Setanta was a British company? I thought it was a Canadian channel. So ESPN bought them out and is competing with a Fox channel basically?
Setanta Sports was born in Dublin Ireland (not British) the UK version of Setanta failed to compete with SKY and over stretched themselves by paying big money for the rights to English Rugby, UFC and mostly a numbers of English PRemier League football games (soccer)
ESPN bought out the UK version of Setanta (who's parent company is the Irish original company because they were losing money and basically went bust over here.
ESPN does compete with SKY yes, in as far as sky is televsion broadcaster here which also has several of its on channels that produce shows and what not. Sky Sports (there are about 4 Sky Sports channels) have to be bought as part of a Sky tv package if you want to watch them, the same goes for ESPN you can by ESPN in addition to SKY and watch both via your SKY tv satillite dish or via Virgin cable (sky also sell the rights to their shows SKy Movies/Sky Sports/FX channels etc) and both sky and cable show other network channels such as CNN etc.
So ESPN can be bought alongside skysports and it has the advantage of being free to Virgin Media viewers. BSKYB however is by far the biggest and most established television provider here in the UK and it's sports channel package is also far more established than espn (it's hard to compete as these packages are expensive already so a lot of people won't/can't pay to have both channels)
The difference this time is ESPN are a massive company, owned by Disney so their money is not going to run out and they can afford to stick around until they gain sufficent market share to become a profitable channel/company here in UK. Which I believe they will, especially if the UFC continues it's current growth and they continue to invest in packages to show Premier league football matches and other sports people want to see.