TV deals burn Premier League

The Premier League could be due for a pay cut after eye-watering back-to-back domestic TV deals but the boom times are far from over for English football.

Sky held on to its position as the main broadcaster of live matches, claiming four of the seven available packages for 2019-2022, with BT taking the other package sold so far at a total combined cost of £4.46-billion.

With more games still up for grabs, the overall deal for the 200 matches on offer each season — up from the current 168 — could still surpass the £5.14-billion paid for 2016-2019 but the price per game has at the moment dropped from £10.2-million to £9.3-million.

AFP Sport looks at the reason for the slowdown in the rampant inflation after successive 70% increases.

‘Correction in the marketplace’

Premier League chief Richard Scudamore could barely contain his glee when he announced the whopping increase in the value of the United Kingdom TV rights three years ago.

It was a deal so good it caused consternation across Europe. La Liga president Javier Tebas warned the Premier League could become “the NBA of football”, having himself secured a deal for just £2.65-billion for domestic rights.

But that level of inflation was not expected to be matched this time around.

“I think the abnormal deal, the one that took everyone by surprise, was the last one — a 70% increase which was way more than I think anybody was expecting,” said former Premier League chief executive Rick Parry.

“It’s a little correction in the marketplace.”

Overseas rights

Where the Premier League does expect to keep cashing in is overseas TV rights.

In November a three-year deal from 2019 was reportedly agreed with China’s PPTV worth $700-million — 10 times the current contract for Chinese TV rights.

United States broadcaster NBC also reportedly paid $1-billion for the six seasons until 2021-22 in 2015.

“On the international stage deals have already been done in the States, China, Brazil and Africa,” Tim Bridge, senior manager at Deloitte’s Sports Business Group told AFP. “The significant growth in new markets suggests the appetite for the Premier League around the world hasn’t diluted.”

In a conference call with investors last week, Manchester United’s executive vice-chairman Ed Woodward said the league’s “global cumulative audience has increased nine percent year-by-year, with particularly strong increases in Asia and North America”.

‘Entente Cordiale’

An agreement reached by Sky and BT in November to provide each other’s content to their customers for the first time also played a significant role in suppressing the value of rights, according to experts.

“BT and Sky have entered an entente cordiale,” said football finance expert Kieran Maguire.

“BT entered the sports market because Sky was hoovering up the broadband market. The deal in November to carry each other’s services is a sign of hostilities between the two easing.”

Sky’s share price rose 3% on Wednesday after boasting how the new deal sees them paying 16% less per game than the previous agreement for their 128 games.

“It is excellent news for Sky,” according to Julian Aquilina of media analysts Enders. “Neither player was pushed to position themselves to bid for all the packages like the last time. They can still offer all the packages to their customers presuming no third party wins the other two packages.”

No prime time for Amazon?

A change to the number and structure of the packages offered had been part of the Premier League’s strategy to drive up prices by enticing tech giants such as Amazon and Facebook to bid for rights.

That interest has so far failed to emerge, although Amazon could still feature in the auction for the final two packages.

Tech companies’ ability to broadcast live sport “is still very much in its infancy”, according to Bridge, who points to the huge production and presentation costs on top of merely winning the rights.

Piracy problem

Another factor suppressing the value of all sports rights is illegal online streaming.

“Piracy was a very big concern,” said Aquilina. “Its shadow has loomed over football TV rights and other sports rights in recent years.

“Because it is so expensive and so popular, people are pushed to find other ways of watching so piracy has definitely played its part in drumming down the price.” — AFP

PW Botha wagged his finger and banned us in 1988 but we stood firm. We built a reputation for fearless journalism, then, and now. Through these last 35 years, the Mail & Guardian has always been on the right side of history.

These days, we are on the trail of the merry band of corporates and politicians robbing South Africa of its own potential.

To help us ensure another 35 future years of fiercely independent journalism, please subscribe.

Kieran Canning
Kieran Canning
Football correspondent for Agence France Presse in London. Still a follower of all things Spanish football. Views here are my own

In East Africa, the locusts are coming back for more

In February the devastating locust swarms were the biggest seen in East Africa for 70 years. Now they’re even bigger

Western Cape Judge Mushtak Parker faces second misconduct complaint

The Cape Bar Council says his conduct is ‘unbecoming the holding of judicial office’

‘My biggest fear was getting the virus and dying in...

South African Wuhan evacuee speaks about his nine-week ordeal

Border walls don’t stop viruses, but a blanket amnesty might

Why South Africa should consider amnesty for undocumented migrants in the time of the coronavirus outbreak.

Press Releases

The online value of executive education in a Covid-19 world

Executive education courses further develop the skills of leaders in the workplace

Sisa Ntshona urges everyone to stay home, and consider travelling later

Sisa Ntshona has urged everyone to limit their movements in line with government’s request

SAB Zenzele’s special AGM postponed until further notice

An arrangement has been announced for shareholders and retailers to receive a 77.5% cash payout

20th Edition of the National Teaching Awards

Teachers are seldom recognised but they are indispensable to the country's education system

Awards affirm the vital work that teachers do

Government is committed to empowering South Africa’s teachers with skills, knowledge and techniques for a changing world

SAB Zenzele special AGM rescheduled to March 25 2020

New voting arrangements are being made to safeguard the health of shareholders

Dimension Data launches Saturday School in PE

The Gauteng Saturday School has produced a number of success stories