BSkyB’s victory over rivals in the fight for the FA Carling Premiership
trophy last week will change the way football is broadcast forever.
The decision came as no surprise. A victory for the Mirror Group/Carlton
bid or United News and Media was a remote possibility. Lord Hollick’s
United in particular faced tough odds.
BSkyB had much in its favour, and not only because of its deep pockets.
The broadcaster has won over many fans with the way it has improved
BSkyB has more than doubled its number of subscribers since it first
secured the FA Carling Premiership in 1992. Now it is set to chart the
future of football with pay-per-view TV.
Perhaps the only surprise was that BSkyB got it so cheap. Sure, Rupert
Murdoch paid pounds 670 million - more than double what he forked out
last time - to broadcast the nation’s favourite sport, but many believe
he could have paid much more.
David Cuff, the broadcast director at Initiative Media, claims: ‘The
Premiership is a prime product and the price of decent quality content
is going up. Some were talking of a figure around pounds 1 billion.’
The success of the Premiership football BSkyB alliance echoes that of
Murdoch’s Fox network in the US, which built itself up on the strength
of American football. Failure to secure the rights for a second spell
would have risked the loss of subscribers, with churn rates rising to
match those of BSkyB’s pre-footballing years.
In the end, the pounds 670 million deal, which will keep the Premiership
on Sky Sports until 2001, was probably forced up slightly by the joint
Mirror Group/Carlton Communications bid of pounds 650 million for five
years and United’s pounds 1.6 billion ten-year offer.
ITV recently won the right to cover the FA Cup, which gives it - as
Edward Lloyd Barnes, a director at IDK, puts it - ‘football that
somebody wants to watch’.
However, ITV has failed to win the Premiership highlights, which stayed
with the BBC’s Match of the Day. This is what some believed was the real
battleground and the failure to prise the highlights from the BBC -
which paid pounds 73 million to keep them - was a disappointment.
Chris Boothby, the broadcast director at BBJ Media Services, comments:
‘While it would have been difficult for ITV to fit live games into the
schedule, there were a lot of people looking for ITV to pick up the
highlights package. Even though it had been with the BBC for so long, it
would have been good to see that going to ITV. But, in the end, the BBC
paid a lot of money.’
The real change comes in two seasons’ time with the introduction of what
the FA Premiership is calling ‘experimental’ pay-per-view TV, which is
the future of football on TV. Fears that this revolution will oust
advertisers from the coverage are misplaced, at least in the short term,
but the role of programme sponsorship is likely to come to the fore as
Most observers believe the fans will pick up the tab for the BSkyB deal.
As with football clubs, which turn to the fans with higher prices for
games and merchandise, BSkyB will raise the cost of its service.
A spokesperson for the FA would not be drawn on its plans with BSkyB for
pay per view - beyond stating the obvious: that, to begin with at least,
it would only involve a limited number of games.
Quite how much pay per view will cost when it arrives in 1998 is
unclear, but fans could be paying pounds 5 or pounds 6 per match. The
profits will help drive BSkyB’s digital satellite ambitions. This is
where the next chapter lies with, eventually, a single channel per team
- brought to you by Ford, Adidas, Caffrey’s or whoever - available for
the price of an electronic season ticket.
The increasing power of BSkyB within the sporting world was further
underlined this week, with the signing of an pounds 87.5 million
unilateral deal with the English Rubgy Football Union. The deal, which
gives Sky the exclusive rights to all Twickenham games for the next five
years, could lead to the expulsion of England from the Five Nations
Premiership Football: the bids
Led by: Sam Chisholm, chief executive of BSkyB
Market capitalisation: pounds 7.7 billion
Bid: pounds 670 million for four years
The strongest bid by a long way, and BSkyB had the advantage of being
the incumbent at a time of massive change in broadcasting. Having the
deepest pockets probably also helped.
United News and Media
Led by: Lord Hollick, chairman of United News and Media
Market capitalisation: pounds 3.7 billion
Bid: pounds 1.6 billion for ten years
Seen very much as a long shot after a deal with Pearson fell through.
Mirror Group and Carlton Communications
Led by: Kelvin MacKenzie, managing director of Mirror TV
Market capitalisation: pounds 3.7 billion
Bid: pounds 650 million for five years
A strong bid with roots in cable. The setting up of a channel and
building a new subscriber base were its biggest problems.