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Sport – Live, in the Technicolor of Money

23/2/2015

 
By Pádraig MacConsaidín

1946. Fifty minutes. Twenty in the first half, thirty in the second, the first live televised soccer match broadcast by the BBC, with coverage cut short due to fading light and limited technology.

2016. 168 live games at an average of £10.2 million per game. Saturday packages, Sunday packages and for the first time ever, Friday night fixtures. A record deal for live broadcasting rights to the English Premier League (EPL) with Sky and BT having agreed to pay £5.136bn for live TV coverage rights for three seasons from the beginning of the 2016/17 campaign. A deal on this scale may be new to the UK, but they have been getting progressively bigger over the years, and the EPL now joins the top table of sports broadcasting deals.

The new Sky and BT deal with the EPL represents the fourth largest broadcasting deal in history in terms of total amount paid for rights, behind the NFL (American Football), NBA (basketball) and MLS (baseball). In terms of cost per annum, the deal is tied with the NBA as the second most expensive agreement, as reflected in the table below.
Picture
Source: BBC
In the US TV rating wars, the sports field is a key battleground. With 97% of all sports programming being watched live, in the world of megabucks TV deals, the gravy train that is the NFL rules supreme. The most recent TV rights deal began with the season just gone and will run through until 2022. The NFL’s broadcast packages with CBS, NBC, Fox and ESPN reflects an increase of 60% on the previous deal, with ESPN committing to pay the greatest amount in order to secure the exclusive rights to the lucrative Monday Night Football slot. The slot, a weeknight in prime time, is the highest rated show on US cable television. In an environment where peoples’ consumption of broadcast content is changing, with the rise of online video services, sports broadcasting has become the last bastion for broadcasters in what may be argued is a stagnating television market. Governing sporting bodies hold the monopoly on power.  Supply and demand in action, and in the US, working for the NFL. 
Picture
Source: BBC
PictureSource: BBC
While the EPL deal is relatively modest in comparison to that of the NFL, what the agreement does reflect is the upward trend in the revenue to the EPL from TV income since the league’s inception. From modest beginnings of £191m over a five year period in 1992, the new deal represents a 2,589% increase on the value of the TV agreement. With the EPL’s global appeal growing and coverage broadcast in over 212 territories across the world, the EPL’s claim to be the world’s most watched league holds some validity. The continued growth in popularity of the EPL’s rendering of the beautiful game, the now commonplace foreign preseason tours of the league’s biggest and best, and the mooted overseas regular season games - similar to the NFL’s arrangement with London; mean that the continued rise in popularity of the EPL could potentially lead to TV income to rival the NFL, given the nature of soccer’s global appeal.

In a previous post, reference was made to the fact that the arrival of the EPL, BSkyB and TV revenue heralded an influx of non-British players in search of lucrative financial rewards. Following the announcement of the new EPL deal, the President of La Liga, Javier Tebas, sounded a warning to Spanish clubs to have a more equitable distribution of TV revenue or face losing its stars to the EPL. This would no doubt only further increase the profitability and selling power of the EPL product for future TV deals. Time will tell, but would Messi, Rodríguez or Ronaldo really fancy it on a wet, blustery night in Stoke? For the right price, I venture they would.

Pádraig MacConsaidín holds a BSc Government degree from University College Cork and is the Department of Government, Richard Haslam - Graduate of the Year 2014.


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