By Robbie Butler
In the coming months those interested in the English Premier League will know the broadcasters that have won the rights to show live league matches from August 2019 to May 2022. I have previously addressed this topic here and here.
I am at a loss to see how the “competition” forced upon the market by the European Commission has in any way helped consumers. With the likes of Amazon, Netflix and Facebook all suggested as potential bidders, the big losers in this could be the very people that opening up the market sought to protect. To understand why, an overview of the seven packages that are on offer from 2019 to 2022 need to be considered. These are presented below.
In the coming months those interested in the English Premier League will know the broadcasters that have won the rights to show live league matches from August 2019 to May 2022. I have previously addressed this topic here and here.
I am at a loss to see how the “competition” forced upon the market by the European Commission has in any way helped consumers. With the likes of Amazon, Netflix and Facebook all suggested as potential bidders, the big losers in this could be the very people that opening up the market sought to protect. To understand why, an overview of the seven packages that are on offer from 2019 to 2022 need to be considered. These are presented below.
Note: The packages broadcast by the current providers differ slightly as few games are presently shown live.
Currently, two broadcasters, (BSkyB and BT) share the rights to the 168 live games per season screened. In order to win one of the seven packages a broadcaster must make a single, sealed-bid prior to the decision date. As no guidance as to what others are willing to bid is provided, bidders must bid high in order to have a chance of success. In some cases, this could be interpreted as overbidding in order to ensure success. Great news for the Premier League but bad news for bidders and customers of subscription channels.
The large increase in the cost of winning the rights, which will probably go above £2 billion per season from 2019-20, sustains the inflation we see in the transfer market. The reason players today earn far more than players even ten years ago, is largely due to inflation in the price of live games.
In theory seven different companies could share the packages listed. If this were the case, seven different subscription charges would be required to watch all live games. As strange as this may seem, consumers would probably be better off if one company, for example Sky Sports as was the case from 1992 to 2007, won the rights to all 200 games. Odd that a monopoly is preferable to "competition".
The reality of course is that this is not competition but instead has led to the creation of seven different monopolies. Prices would fall, and with it transfer fees and player salaries, if more than one broadcaster could buy the same package. Only then will the market be competitive.
The large increase in the cost of winning the rights, which will probably go above £2 billion per season from 2019-20, sustains the inflation we see in the transfer market. The reason players today earn far more than players even ten years ago, is largely due to inflation in the price of live games.
In theory seven different companies could share the packages listed. If this were the case, seven different subscription charges would be required to watch all live games. As strange as this may seem, consumers would probably be better off if one company, for example Sky Sports as was the case from 1992 to 2007, won the rights to all 200 games. Odd that a monopoly is preferable to "competition".
The reality of course is that this is not competition but instead has led to the creation of seven different monopolies. Prices would fall, and with it transfer fees and player salaries, if more than one broadcaster could buy the same package. Only then will the market be competitive.
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