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SBD Global/January 10, 2014/Media

Pricier Football Broadcast Rights Hit Sky, Canal+, Benefit BT Sport

Some 173 million viewers watched last year's Champions League final.
New European sports broadcasters "are causing trouble for rivals" that have long had a lock on televising football matches, according to Thomson, Schweizer & Mawad of BLOOMBERG. Pay-TV services from Sky to Canal+ "risk being priced out of the sport they have ruled for more than a decade," with entrants such as BT and Al Jazeera’s beIN Sport "bidding up rights contracts to as much as double their previous level." At stake is "one of the globe’s biggest live TV audiences." Some 173 million viewers across Europe and beyond watched Germany’s Bayern Munich and Borussia Dortmund square off in the UEFA Champions League final last season. As a new round of rights auctions approaches, more established broadcasters "face giving up some of their most popular programming or shelling out far more for licenses." Either option "poses a threat to profit." Sky Deutschland CEO Brian Sullivan said, "In the world of sports content, the only thing you can be sure of is there’s somebody who’s got a check that’s bigger than their business plan." For its BT Sport and ESPN channels, which went live in August, BT outbid British pay-TV market leader Sky for rights to the UEFA Champions League and UEFA Europa League. London-based Liberum Capital media analyst Ian Whittaker said, "BT is doing to Sky what Sky did to everyone else years ago when it used its cash to knock out competition." Sky Deutschland in '12 won rights to broadcast Bundesliga matches, beating rivals including Deutsche Telekom AG, another former phone monopoly expanding to other services. In the auction, which included online and mobile rights for '13-17, the average annual income from the German rights soared 52% to a record €628M. In France, newcomer beIN Sport, set up by Qatar broadcaster Al Jazeera, beat Vivendi SA (VIV)’s Canal+ to most of the rights for Champions League in the last round of bidding. Deloitte partner Dan Jones said that the "biggest beneficiaries" of the increase are football clubs. Jones added that if they use the windfall to boost player salaries and build stronger teams, "it’s money well spent." Jones: "The only reason people buy tickets, T-shirts and TV subscriptions is because of what the guys are doing on the pitch" (BLOOMBERG, 1/8).
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