SBD/Issue 98/Sports Media

EPL Unveils Record U.K. TV Deal, BSkyB Wins Five Of Six Packages

The English Premier League "shrugged off the threat of the credit crunch" Friday when it announced "a record television deal that will be worth almost" US$2.7B over three years, according to Kevin Eason of the LONDON TIMES. The deal, for the U.K. TV rights to the '10-11 season through the '12-13 campaign, will provide EPL teams with a 5% increase in TV payout and "will help to bolster the finances of their clubs until 2013." EPL CEO Richard Scudamore: "The great thing is that the clubs now know that the lion's share of their income is secure, which gives them a stable base from which to plan for the future. Even in the recession, television audiences are holding up and doing well and more people are watching television. We are not immune to what is going on out there but the clubs are now well placed through the medium term." BSkyB obtained "five of the six broadcast packages of 23 matches each that have been auctioned," as the company "upped its bid from the [US$1.9B] it is paying now for four packages in the present three-year deal, to [US$2.4B] for the new rights." Meanwhile, Setanta Sports, which has two packages under the current rights deal, "won a single package of 23 matches that will be aired at 5:15pm on Saturday evenings, paying only [US$236.9M] leaving Sky with the first pick of the best matches to be screened at peak hours." Eason noted with overseas rights for the three seasons still to be distributed, the EPL "could set another record for its total broadcasting rights, surpassing the [US$4.0B] it achieved in the present round." Scudamore: "We don't see any reason why we shouldn't do ... extremely well overseas" (LONDON TIMES, 2/7).

BLOW TO SETANTA: In Manchester, Mark Sweney noted Setanta "has invested hundreds of millions of pounds into sports rights to crack the UK pay-TV market," but the loss of an EPL package "raises questions about Setanta's strategic position" in the market. One analyst: "Setanta is going to have to look at its options, such as perhaps a wholesale deal to bundle its matches with Sky Sports." BSkyB also "will now have to consider its options." An analyst noted BSkyB "can't acquire Setanta and there has to be a sports competitor to BSkyB. Regulators demand it, so it is not in Sky's best interests to see Setanta off. They must have a plan to accommodate them, to shut the door (on Setanta) could see them go into the arms of, say, ESPN, making it potentially an even stronger competitor down the line"  (Manchester GUARDIAN, 2/7). Enders Analysis analyst Toby Syfret estimated BSkyB "might make [US$29.9M] or so more annually in increased advertising and revenues from pubs and clubs" as a result of the new deal. Syfret: "But they are paying [US$153.7M] more, so it is not absolutely clear what the benefit is for them, except putting Setanta in its place" (FINANCIAL TIMES, 2/7).

WHAT RECESSION? In London, Nick Harris wrote the deal shows that the EPL is, "once and for all, recession-proof." The deal "means the wages stay high" and "the best players stay." Harris: "The show goes on." EPL clubs "have three revenue streams: match-day, commercial, and media," and with the deal, media revenue "has been secured at a stroke until 2013." Match-day revenue also, "for the moment, shows few signs of dropping massively" (London INDEPENDENT, 2/7). Meanwhile, In Manchester, Leigh Holmwood reported U.K.'s Channel Five has signed an exclusive deal with EPL club Aston Villa "to screen its next Uefa Cup clash," the February 18 CSKA Moscow-Aston Villa match, as well as Aston Villa's "next round match, should the club make it that far" (Manchester GUARDIAN, 2/7).

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