The past year was a record-setting one for sports media deals across the globe. As expected, the English Premier League drew much attention with another record domestic TV rights deal, La Liga passed the Real Decreto, Discovery swept up the European Olympic media rights and the BBC struggled to hold on to its properties in the face of budget cuts.
MONEY MAKERS: The EPL’s $7.8B record domestic TV deal at the beginning of the year further cemented its title as the richest league in the world. The record price tag exceeded expectations and was a 70% increase of more than $3B on the existing three-year deal. Sky emerged as the dominant broadcaster, securing five packages resulting in 126 matches, with BT pulling in 42 after winning two packages. As a result of the giant deal, EPL CEO Richard Scudamore faced calls for cheaper tickets for fans and increased investment at the grassroots level. Addressing the trend of EPL clubs designating a significant amount of revenue to player transfers and wages, Scudamore emphasized the importance of maintaining world-class talent in the league. “We can’t be clearer,” he said. “Unless the show is a good show, with the best talent and played in decent stadia with full crowds, then it isn’t a show you can sell.”
Another media deal that turned heads was China Sports Media Co. Ltd.’s purchase of China’s top-tier professional football league, the Chinese Super League. After outbidding CCTV, CSM spent $1.26B for the rights, eclipsing the $7.8M price of the previous season. The broadcast deal follows the country’s renewed interest in the sport, after the government announced China’s football reform plan in February that makes qualifying for a World Cup and increasing youth participation among the country’s top sports goals. China’s cabinet, the State Council, also called for the Chinese sports industry's gross output to increase to 5T yuan by ‘25. In December, China Media Capital, the holding equity fund of China Sports Media, along with investment company CITIC Capital bought a 13% stake in Man City owner City Football Group for $400M. The purchase resulted in CFG appointing China Media Capital Chair Li Ruigang to its board and the Chinese company acquiring a stake in Major League Soccer club New York City FC and A-League side Melbourne City, all among CFG’s sports properties.
DEALS DOWN UNDER: Australia had its fair share of record-breaking deals, starting with the National Rugby League's announcement of a new five-year broadcast rights deal worth $1.8B. Beginning in ’18, all matches will be shown on Fox Sports with the Nine Network picking up Thursday and Friday night matches, as well as Sunday afternoon fixtures. The Australian Rugby Union also announced a $275M deal that will see all Super Rugby matches shown live on Fox Sports with Ten Network showing Sunday morning replays.
KEEPING IT EVEN: The top story in Spain was the long awaited passing of the Real Decreto on April 30, which evens out La Liga’s distribution of revenue from TV contracts. Previously, Real Madrid and Barcelona were earning up to 10 times as much from TV revenue as the league’s lowest-earning clubs. Now, with La Liga’s TV rights sold collectively, 50% will be distributed equally among all the clubs, with the other 50% distributed based on various criteria. Spanish Football League (LFP) President Javier Tebas told SBD Global it was an "important step forward compared to prior contract agreements" (Tyler Everett, SBD Global).
DISCOVERY SWEEP: In June, Discovery Communications and Discovery-controlled Eurosport picked up the European broadcast and distribution rights to the Olympic Games from ‘18-24 for $1.48B. European broadcasters will now have to sublicense Olympic content from Discovery rather than buy the rights from the IOC itself. The deal will also result in a partnership between Discovery, Eurosport and the IOC’s new year-round Olympic channel. While hailed as a landmark deal for Discovery, which is continuing to step up its presence in the European market, the deal was a huge blow for the BBC, which struggled throughout the year to maintain its hold on sports content.
In November, the broadcaster announced that it would cut spending on athletics and minority sports in an attempt to save £150M ($225M) in its yearly budget. Along with cutting online news, the BBC said the decrease in sports coverage would save the organization £35M ($53.6M). In October, it dropped the 2016 British Open a year earlier than planned after showing the tournament live for over 60 years. Next year’s tournament will now be shown on Sky Sports, which won the rights to the event through ’21 in a deal worth $22.7M annually. The Australian Open was also dropped from the BBC’s broadcast portfolio after it failed to match the tournament’s asking price, leaving Eurosport with the exclusive rights.
BBC LOSES GRIP: The increase in public broadcasters losing out to cable companies in the sports rights market resulted in the European Broadcasting Union’s call for regulatory protection of free-to-air sport. The EBU said, "The general public risks losing out in all European countries. This negative trend needs to be halted with regulatory support.” With companies like Sky and BT willing and able to spend billions on sports, it appears as though the BBC will only continue to surrender its hold on sports content. After a plea to F1 CEO Bernie Ecclestone to renegotiate its F1 contract was rejected, it came as no surprise to see the circuit become the next property to leave the BBC’s dwindling sports rights cache after the broadcaster announced it would end its deal three years early.
