BSkyB, which has built
its British pay-TV business on the back of football rights, could
face a costly challenge from Qatari group Al Jazeera when
English Premier League rights are renewed this summer.
Better known for covering news in the Middle East, Al
Jazeera has recently expanded aggressively in French football rights, prompting speculation it wanted to cross the Channel to
muscle in on the Premier League.
The outcome of the looming contest will be deeply
significant for the bidders and for the Premier League's member
clubs, who have reaped millions of pounds from the sale of
rights to broadcast their top stars in action.
BSkyB has had the lion's share of domestic Premier League
rights since the competition was launched two decades ago, the
two enjoying what one former Sky executive called "one of the
great corporate romances of our time".
However, that love does not come for free.
BSkyB paid 1.6 billion pounds for a
three-year deal signed in 2010 which allows it to show 115 live
matches in Britain each season. U.S. sports broadcaster ESPN
paid around 180 million pounds to show 23 live games per year.
The Premier League also cashes in on the global appeal of
clubs like Manchester United, Liverpool and Chelsea, raising
more than 1.3 billion pounds for overseas rights over three
years, far exceeding what other European leagues earn.
The 20-club Premier League was expected to issue tenders in
the next week or two for rights from 2013. BSkyB will face a
tricky choice on how to pitch its bid in a blind auction.
"The Premier League needs the market to think that Al
Jazeera is coming in order to make others bid higher," said
Simon Johnson, a consultant with the Sports & Media Group at
lawyers Charles Russell.
"Al Jazeera are ambitious, wealthy and acquisitive, but as
of now they have concentrated all their efforts on buying rights
in France," he said.
BSkyB declined to comment, while Al Jazeera could not be
reached for comment. ESPN indicated it wanted to retain rights.
"Like many around the world, we're fans of the Premier
League and would love to continue bringing it to fans in the UK
as we do in many countries around the world," said an ESPN
spokesman. "We're awaiting details of the rights tender and look
forward to participating in the process."
Sky Deutschland, which like BSkyB is part-owned
by Rupert Murdoch's News Corp, spent heavily last week
to retain live rights to German football.
In Germany, Sky outbid a deep-pocketed rival in the shape of
telecoms group Deutsche Telekom. It will pay an
annual 485 million euros for live rights across
all platforms in an overall agreement that gave a delighted
German league a 52 percent increase on the previous one.
"The specifics of the German broadcast market are different
to the UK market. What the German auction did show was the
continued importance of top flight football to pay TV operators,"
said Austin Houlihan, a senior consultant in the sports business
group at Deloitte.
Commentators wonder whether the time is right for Al Jazeera
to challenge dominant player BSkyB head-on in a market where it
has no experience of covering major sports.
It is racing to set up a new French pay TV channel in time
to broadcast matches from the Euro 2012 tournament that kicks
off in Poland on June 8.
"It is likely that Al Jazeera will simply test the waters by
acquiring the rights to a small chunk of games, following in the
footsteps of Setanta and ESPN in recent years," said Iain
McDonald, associate in the sports team at law firm Lewis Silkin.
THE PUB LANDLADY
The unlikely figure of English pub landlady Karen Murphy has
also altered the broadcast landscape after she was prosecuted
for screening games via a Greek TV network, undercutting the
The High Court in London overturned her conviction and the
Premier League may opt to sell rights on a pan-European basis to
prevent legal battles in the future.
"The complication is whether the domestic rights become a
European set of rights," said Johnson. "You can't divide your
rights by territory now in the European Union; you can, in my
opinion, only divide them by languages."
Sky Deutschland and Sky Italia already have rights in
Germany and Italy so a pan-European deal will not wrongfoot
BSkyB given their common News Corp affiliations.
Legal issues thrown up by the Murphy case have slowed the
tender process, but the Premier League would like to have a new
three-year agreement in place by June.
Once a domestic or pan-European deal is settled, the Premier
League will start to renew contracts for other parts of the
world in the subsequent months.
Premier League matches are broadcast to 650 million
households in more than 200 countries. Top clubs have huge
overseas followings, with TV and social media allowing them to
exploit this commercially.
British radio station Talksport signed a deal last
week to broadcast live commentaries overseas in English, Spanish
and Mandarin, further proof of the league's global draw.
"For overseas earnings, the Premier League is very much out
on its own compared with its closest rivals in Europe - Spain
and Italy," said Deloitte's Houlihan.
"The Premier League is very competitive, Britain has strong
historic links with places like Hong Kong and Singapore," he
added. "And compared to certain other European Leagues the
kick-off times are more conducive for audiences in these
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