In the "high-stakes race" to control football TV rights in China, with a "potential market of hundreds of millions of fans," electronics retailer Suning is betting up to $2B that "could give it a near monopoly on broadcasting the sport at home," according to Pei & Jourdan of REUTERS. Suning Commerce Group, a retail conglomerate with annual revenue of around $22B, owns Inter Milan, and is "fast securing the rights to air matches from Europe's top leagues in China." It already owns rights to La Liga and the Chinese Super League, "has bought future seasons" of top-flight German and English football, and is "looking to secure" Serie A and Asian football, three people familiar with its plans said. Backed by Beijing, China's domestic sporting market could be worth 5T yuan ($740.6B) by '25. Key to a share of that profit is the right to show matches from major leagues, and Suning's PPTV video streaming website is "sweeping most rivals out of the way." Competition from Sina Sports and technology company Tencent, though, means it is "costly to stay out in front." ManU Asia-Pacific Managing Dir Jamie Reigle said, "Historically in China, there was good interest from fans but not a lot of competition between media rights buyers. Now you have the digital platforms that have come in and want to build an audience. That's what has changed the dynamic." The sums paid for local and overseas rights by Chinese firms have "ballooned by as much as ten-fold over the last few years" (REUTERS, 7/25).
UNDERCUTTING GROWTH: Pei & Jourdan also reported China Sports Media paid a record 8B yuan ($1.18B) in '15 for a five-year contract to broadcast the CSL. CSM CEO Zhao Jun now says that "new directives" by the Chinese government, such as limiting foreign players, are "undercutting the growth" of the CSL, and that the company wants to renegotiate its deal. Zhao said, "What we bought at the time was the future, but the future is not coming on time." At the "heart of this are new rules that have put a virtual block on splashy player transfers and abrupt changes to a quota system" that caps the number of foreign players that domestic teams can field. CSM's position "underscores a growing political risk" for global and local players in China's sports market, where "overt support for the game" two years ago has been replaced by "tough regulations and scrutiny" on investment deemed "irrational" by the government (REUTERS, 7/25).
