The Premier League has begun the tender process on the football rights that underpin UK pay-TV. Julian Clover discusses the possible results.
There is a test for deciding on the relevance of a news story based on how it would sound if the position were to be reversed. There was one of these this week when a number of sources reported that ESPN w had submitted tender documents to the Premier League. Frankly it would have been more interesting if ESPN had chosen not to put in a bid, though with Disney as its ultimate owners, the story always had a headline attached to it.
The new contract will run from 2010 to 2013 and is of great importance, both to the League, and UK pay-TV. In the last contract period, BSkyB and Setanta paid £1.31 billion and £392 million, for packages consisting of 92 and 46 live matches per season. It was also the first contract after the decision by the European Commission that forced the Premier League to split the rights between at least two broadcasters.
There was a period of delusion where some thought that this would have been the opportunity to put live Premier League football onto one of the Big Five channels, but the ball was always heading for the pay-TV goalmouth. ESPN also reportedly bid last time around, but was unsuccessful, in the meantime its European stock has risen through the acquisition of NASN. The former Setanta-owned channel will shortly be rebranded as ESPN America, adding live premium sports from across the Atlantic, to the Classic brand that has already established itself on multi-platform network. Under the hood a sizeable multimedia proposition is also taking shape.
Since then Setanta has built itself up as a competitor to Sky Sports, not just through the Premier League, but also the FA Cup, England internationals, golf and boxing. Sweetheart subscription deals with Virgin Media, Top Up TV and Setanta have grown the audience base. Virgin itself has all but ruled out a bid.
Setanta is also owned by private equity and major investor venture capital firm Balderton, which has also placed money in Bebo and Betfair, this week topped up its funds by a further $430 million. The permutation of a Setanta win, and an ESPN acquisition must surely be a possibility, and arguably better than a three-way split of the rights.
An ESPN win would present the football fan with a dilemma as Britain, presumably and hopefully, comes out of the other side of recession. Even in times of good the market could surely not support three premium sports channels as well as the basic packaged Eurosport, which has placed itself neatly beyond the fray. It also would do little for The FA Cup, where audiences are already down under ITV and Setanta, and with former joint rights holders the BBC mischievously announcing the name of the new Doctor Who opposite ITV’s first live game and pulling in a seven million audience along the way.
