Power up the Time Capsule if it is not already on, and let it run a few minutes
Then, hold in the reset button on the back of the Time Capsule for 7-8 seconds and then release the button
Allow a full minute for the Time Capsule to restart to a slow, blinking amber light status
I assume that you have tested the Ethernet cable that will connect the Sky router to the Time Capsule....to make sure that it is operating correctly. If you have not done this, first connect the Ethernet cable to one of the four LAN <--> ports on the back to the Sky router and connect your Mac....or other computer....to the other end of the Ethernet cable. Temporarily turn off the WiFi on the computer to make sure that the wired connection will be active.
Check to make sure that the computer can get a good Internet connection that way. If it can, then you know that the Ethernet cable is working correctly and you can proceed to with the setup of the Time Capsule. However, if the computer cannot get a good Internet connection, then you likely have a defective cable that will need to be replaced before you can proceed with the setup of the Time Capsule.
After you have verified that the Ethernet cable is working correctly......
Disconnect the computer from the Ethernet cable and connect the open end of the Ethernet cable to the WAN "O" port on the Time Capsule
If you are using a Mac for the setup of the Time Capsule.......
Click on the WiFi menu at the top of the Mac's screen
Look for a listing of New AirPort Base Station
Just under that listing, click directly on Time Capsule
The example below shows an Airport Express as the New Airport Base Station. You will see Time Capsule on your screen

If you are using an iPhone or iPad for the setup of the Time Capsule.......
Go to the Home Screen on the iPhone / iPad
Tap on Settings (gear icon)
Tap on WiFi
Look for a listing of Set Up New Base Station
Tap on Time Capsule
The example below shows an AirPort Express as the new Base Station, but you will see Time Capsule on your device screen

When you click on Time Capsule (using a Mac), or tap on Time Capsule (using an iPhone or iPad), that will start up the setup "wizard". It will take a few seconds to display a screen that looks similar to the example below, except that you will see a Time Capsule pictured on the screen

Network Name......Type in a name for the wireless network that the Time Capsule will provide
Base Station Name......Type in a device name that you want to use for the Time Capsule
Password.....Type in a password that will be used for the wireless network and the device
Verify.....Type in the same password again to confirm
Click Next
The setup "wizard" will configure the Time Capsule correctly and automatically
When you see the message of Setup Complete, click Done
Now, connect to the Time Capsule wireless network that you created and make sure that the Mac or iPhone / iPad can connect to the Internet.
Then, connect your Mac or iPhone / iPad to the Sky router wireless network and check again to make sure that the device can connect to the Internet
Please post back on your progress
Please do not try to back up your Mac yet, as there are more settings that will need to be adjusted on your Mac before backups will work reliably.