The amount paid by broadcasters for three years of Premier League television rights from 2016-17 has exceeded all expectations. Sky and BT agreed to pay £5,16bn over the period: three years ago they paid just £3bn for the rights. Sky is spending more on its own that the City estimated the whole auction would realise.
The amount paid by broadcasters for three years of Premier League television rights from 2016-17 has exceeded all expectations. Sky and BT agreed to pay £5,16bn over the period: three years ago they paid just £3bn for the rights. Sky is spending more on its own that the City estimated the whole auction would realise.
Most of the increase will be paid by Sky. Rumoured bidders Al Jazeera and Discovery Communications failed to win any matches. Sky will pay £1.4bn each year to show 126 matches, including the coveted Sunday kick offs. BT will pay £320m a year to broadcast 42 games. It is paying just 16 per cent more than last time for what it will claim is a better package of matches.
Sky expects to cover its increased costs through price increases and cost savings. Customers might have to wire their own boxes and wait longer on helplines. Investment in non-sports content could be affected. Football will now account for 27 per cent of the UK’s television budget.
Overall, the rights are worth £10m a game. One likely consequence is a widening of the gap between the Premier League and other divisions and even more frenetic attempts by Championship clubs to win promotion, given that the rewards of even just one year in the top flight will be massive. As it is, Burnley earn more than Ajax.
There has been concern about the effects on grass roots football and the absence of a real ‘trickle down’ effect, but Premier League chief executive Richard Scudamore argued on Radio 5 that he was not running a charity. He also believes that the money will allow English clubs to compete more effectively with the likes of Real Madrid and Barcelona. He said, ‘It’s easy to look down. We prefer to look up and out.’
Spain’s football chief certainly certainly fears an exodus of talent from La Liga to the Premier League and is worried that their competition will be devalued.
Fans are likely to renew their pressure for a reduction in match prices, but gate revenue is an increasingly small proportion of clubs’ earnings.
For a critical but balanced perspective on the deal go here.