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UEFA Champions League on TV
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loyalsince
30-08-2016
Realistically the max itv will pay for first pick Tue is £70m a year!?

If its has a first pick prime time, this devalues first pick on Wed too as most viewers happy with one game over two nights.

I.e. good chance bt or sky would pay £350m for both nights, but not £280m for all matches bar Tue first pick.

Thus itv getting maybe first pick Tue at six, with no semi might be worth £25m, but key will be whether bt /sky see that as acceptable

Sky first round bidding has been poor. Bt placed with UEFA a £300m no second round bid. Sky's bid must have been considerably lower for UEFA not to gamble with round two.

Likewise for pl it is reported bt secured sat evenings on first round. Again sky must have bid too low.
TLG86
31-08-2016
Originally Posted by TheSubaru2012:
“But didn't Man United V Liverpool get moved to 8:05pm because the council or someone didn't want it to start at 6pm? I would understand if it was a low key game but for big head-to-head games I would think they would reject it starting at 6pm.”

The issues, of course, was that Spurs were also in action and it was that game's turn to be 20:05. In the group stage of the Champions League there wouldn't be an issue as the fixtures could be set to ensure that the English team at home could be at 20:05. Furthermore, the Last 16 ties are split over four weeks, so it would only start to become an issue if three or more English teams made it to the quarter finals, were kept apart and were all at home/away in the same order.

However., this would be sub optimal for some situations. For example, week 2 this year has Arsenal v Basel and Celtic v Man City, while week 3 sees Arsenal v Ludogorets and Barcelona v Man City. Would TV really want Arsenal in the 20:05 slot?
mightymillie
31-08-2016
Originally Posted by loyalsince:
“Realistically the max itv will pay for first pick Tue is £70m a year!?

If its has a first pick prime time, this devalues first pick on Wed too as most viewers happy with one game over two nights.

I.e. good chance bt or sky would pay £350m for both nights, but not £280m for all matches bar Tue first pick.

Thus itv getting maybe first pick Tue at six, with no semi might be worth £25m, but key will be whether bt /sky see that as acceptable

Sky first round bidding has been poor. Bt placed with UEFA a £300m no second round bid. Sky's bid must have been considerably lower for UEFA not to gamble with round two.

Likewise for pl it is reported bt secured sat evenings on first round. Again sky must have bid too low.”

BT's bid was for all Champions League and all Europa League games, and they were only willing to pay that amount if they got everything. (Even though they would have had to submit individual values for each of the 9 packages)

Sky didn't bid for any Europa League nor for the Tuesday night Champions League first pick. ITV bid only for the packages that Sky didn't. The combined value of the Sky and ITV bid was around £185m.
loyalsince
31-08-2016
Thanks, I presume europa league as trivial importance for sky/bt although I appreciate it has value and for itv in particular.

I presume unlike the pl you may decline a pack after winning. I.e. if sky won just one second pick pack they could say stuff it.

Interesting if sky and itv bid again together. Didn't work out for fa cup a couple of years ago too. I wonder if sky might go for everything, with itv simulcast of finals, a first pick 6pm cl and some Europa league
casinoman13
31-08-2016
Originally Posted by loyalsince:
“Thanks, I presume europa league as trivial importance for sky/bt although I appreciate it has value and for itv in particular.

I presume unlike the pl you may decline a pack after winning. I.e. if sky won just one second pick pack they could say stuff it.

Interesting if sky and itv bid again together. Didn't work out for fa cup a couple of years ago too. I wonder if sky might go for everything, with itv simulcast of finals, a first pick 6pm cl and some Europa league”

Would Sky really want to dig deeper into their pockets for something they have reportedly described as losing viewers?

If anything i can see them showing limited interest in the hope BT will bid silly money much like BT did to them regarding the previous rights to the Prem League.
samburrows
31-08-2016
As per previous discussions it will come down to whether Sky think they can grow the subscriber base by acquiring these rights at a sensible cost.

At £300m per year they would need to add an extra 532,000 subscribers (assumed ARPU £47pm / £564pa (Jan 16)) simply to cover rights costs. Assume a higher number than that to cover rights + programming costs combined.

They may simply conclude that it just isn't worth it. After the monster price they ended up paying for the current PL rights cycle they have had to focus on cost cutting whilst protecting the customer base. Going in strongly for the CL rights would not necessarily fit with this approach.
Gray77
31-08-2016
There has been no real evidence that losing the CL has harmed Sky really. The PL is the competition that pulls in the subs, and it is the comp that is by far and away the one to have the big games of. Whilst Sky retain access to the primary 1st pick PL packages and have control over the vast majority of Big 5 games and the title run-in they do not necessarily need the CL.

I would argue that the CL has suffered from not being on Sky and (more importantly) ITV. I have BT and didn't watch more than 6-7 CL games last season, and as a competition I honestly believe it became secondary to alot of people as a result of it being on BT. Sky must be aware of how little they have missed it in financial terms, and must also be aware of how little (relatively) BT gained in subs from having it.

As for the other discussion regarding kick off times changing to 6pm and 8:05pm, well this is the kind of thing I could imagine UEFA doing. If done properly it could work, because in countries like Greece and Turkey you have CL games kicking off at 9:45pm at the moment, whereas the early games in the new scheme would be kicking off at 8pm local time there. In that sense it would work.

In CET time zones it would be important to look at geographical differences in terms of working habits and cultural preferences. Namely, in countries like Spain and Italy where games often kick off quite late it would be difficult to have lots of games kicking off at 7pm local, whereas in Northern Europe it would be easier to sell.

As for us, well I would hope that games kicking off in the UK always sat in the 8:05pm slot. 6pm is too early, it gets in the way of so many other things and it is ridiculously difficult for fans to get to games. I know it has happened in the EL with Liverpool playing at that time last season, but it wasn't something that I would like to see repeated. IMO one of the reasons why the EL is derided as a secondary comp is because some games kick off at 6pm UK time, which gives the comp a bad image.
Judio
31-08-2016
Easy to do
Just make sure no 2 English clubs are at home on same night.

Only Portugal England and Scotland would really object to 600 kick offs.

You have a big problem though if ITV wanted to show English club away.
They would not pick the 600 kick off
TheSubaru2012
31-08-2016
Tuesday 13th September:
Goals Show: BT Sport 1
PSG v Arsenal: BT Sport 2
Barcelona v Celtic: BT Sport 3
Man City v Borussia Monchengladbach: BT Sport ESPN/Ultra HD

Wednesday 14th September:
Club Brugge v Leicester City:
BT Sport 2
Tottenham Hotspur v Monaco: BT Sport 3
Goals Show: BT Sport ESPN

So Goals Show will move to BT Sport 1 when there are 3 British teams playing on the same night then.
mlt11
31-08-2016
Originally Posted by samburrows:
“As per previous discussions it will come down to whether Sky think they can grow the subscriber base by acquiring these rights at a sensible cost.

At £300m per year they would need to add an extra 532,000 subscribers (assumed ARPU £47pm / £564pa (Jan 16)) simply to cover rights costs. Assume a higher number than that to cover rights + programming costs combined.

They may simply conclude that it just isn't worth it. After the monster price they ended up paying for the current PL rights cycle they have had to focus on cost cutting whilst protecting the customer base. Going in strongly for the CL rights would not necessarily fit with this approach.”

I think we can say for certain that's Sky's profits in 2015/16 were higher without the CL than they would have been if they had paid £300m for the CL.

Revenue growth remained similar to the long term trend and churn only rose marginally. There is simply no way that revenue would have been a further £300m higher if they had had the CL - so profits would have to have been lower.

If we stop the analysis there then Sky is undoubtedly better off without the CL. However, it isn't as simple as that.

I'm conscious that this has been discussed before so very briefly losing the CL changes Sky's attitude to risk re the PL - forcing them to bid higher than otherwise as they simply can't take so much risk of losing (significant) PL content.

Also BT gaining the CL strengthens BT's offering which will adversely affect Sky - and in particular the effect may only be felt over a long period - so whilst Sky's revenues weren't really affected in 15/16 there may be an effect further down the road.

The problem is that quantifying the effect of the above two paragraphs with any accuracy is impossible (certainly for us).

However, my own view is that it's highly likely that the CL was simply worth more to BT - ie the "right" company won the auction - or put another way the combined profits of Sky + BT are higher with BT paying £300m for CL than they would be with Sky paying £300m for CL.

ie BT can monetise the CL better than Sky - and we saw evidence for this in how well BT absorbed its CL costs in its first year of having it - with profits only down very marginally - in significant part probably due to the "opt out" £5 charge landing well.

In contrast it's likely that with the CL in its portfolio Sky is "overserving" customers - ie customers won't leave without it - but with it Sky can't force through the additional price rise which would be required to pay for it - and nor can it generate the required incremental subs (nor a combination of the two).
hard_to_beat
31-08-2016
Originally Posted by mlt11:
“I think we can say for certain that's Sky's profits in 2015/16 were higher without the CL than they would have been if they had paid £300m for the CL.

Revenue growth remained similar to the long term trend and churn only rose marginally. There is simply no way that revenue would have been a further £300m higher if they had had the CL - so profits would have to have been lower.

If we stop the analysis there then Sky is undoubtedly better off without the CL. However, it isn't as simple as that.

I'm conscious that this has been discussed before so very briefly losing the CL changes Sky's attitude to risk re the PL - forcing them to bid higher than otherwise as they simply can't take so much risk of losing (significant) PL content.

Also BT gaining the CL strengthens BT's offering which will adversely affect Sky - and in particular the effect may only be felt over a long period - so whilst Sky's revenues weren't really affected in 15/16 there may be an effect further down the road.

The problem is that quantifying the effect of the above two paragraphs with any accuracy is impossible (certainly for us).

However, my own view is that it's highly likely that the CL was simply worth more to BT - ie the "right" company won the auction - or put another way the combined profits of Sky + BT are higher with BT paying £300m for CL than they would be with Sky paying £300m for CL.

ie BT can monetise the CL better than Sky - and we saw evidence for this in how well BT absorbed its CL costs in its first year of having it - with profits only down very marginally - in significant part probably due to the "opt out" £5 charge landing well.

In contrast it's likely that with the CL in its portfolio Sky is "overserving" customers - ie customers won't leave without it - but with it Sky can't force through the additional price rise which would be required to pay for it - and nor can it generate the required incremental subs (nor a combination of the two).”

Won't it therefore follow that with Sky possibly not interested in making a competitive bid, that BT could make a bid to UEFA that was lower than last time, in the knowledge that a) Sky have determined that it doesn't fit/required for their overall strategy, and b) because of that, UEFA are in quite a difficult position, arguably of their own making.

What can UEFA do? If they can't really enforce a split ala the Premier League as they simply don't have enough games to do that with, and they don't experimenting with selling direct to customer (via YouTube?), than they are in a bit of corner potentially.
pakokelso93
31-08-2016
The split time UCL theory - one major problem I don't like in the article is about more complications to where teams go pots wise. Makes the 'excitement' for the draw even less of an appeal.
mlt11
31-08-2016
Originally Posted by hard_to_beat:
“Won't it therefore follow that with Sky possibly not interested in making a competitive bid, that BT could make a bid to UEFA that was lower than last time, in the knowledge that a) Sky have determined that it doesn't fit/required for their overall strategy, and b) because of that, UEFA are in quite a difficult position, arguably of their own making.

What can UEFA do? If they can't really enforce a split ala the Premier League as they simply don't have enough games to do that with, and they don't experimenting with selling direct to customer (via YouTube?), than they are in a bit of corner potentially.”

Oh I'd certainly expect Sky to submit a competitive bid - even if only to stop BT getting it on the cheap.

Looking at BT's financials for this year I think BT would be willing to pay more than £300m per year for 2018/21.

So at a minimum I'd expect Sky to put a bid in in that region - even if they don't seriously expect to win (or indeed even if they don't want to win).
brundlebud
01-09-2016
Originally Posted by mlt11:
“However, my own view is that it's highly likely that the CL was simply worth more to BT - ie the "right" company won the auction - or put another way the combined profits of Sky + BT are higher with BT paying £300m for CL than they would be with Sky paying £300m for CL.

ie BT can monetise the CL better than Sky - and we saw evidence for this in how well BT absorbed its CL costs in its first year of having it - with profits only down very marginally - in significant part probably due to the "opt out" £5 charge landing well.

In contrast it's likely that with the CL in its portfolio Sky is "overserving" customers - ie customers won't leave without it - but with it Sky can't force through the additional price rise which would be required to pay for it - and nor can it generate the required incremental subs (nor a combination of the two).”

In other words, viewers are having to pay more money to receive the same output...
Rich1977
01-09-2016
I think the only motive for Sky bidding for CL rights would be to weaken BT but they are probably over stretched now for this and to their own admission they said BT had vastly overpaid for the rights (sour grapes).

BT learned quick after the first PL tender that to beat BT you have to blow them out of the water because as soon as you let them in for a second round you've lost.

At the moment I think their primary concern will be protecting their football league and cricket rights.

One consideration to think about is the potential for a 3rd Player to look at these rights in particular Eurosport.

They have been expanding their portfolio and part of me would not be surprised at them go for a huge bid for pan European rights like they did with the Olympics.
popeye13
01-09-2016
The cuts and impact caused by the massive bill Sky has for the EPL rights IMHO takes them out of the equation for UCL rights.
They can barely afford the EPL and will be making some losses as a result of the cost, adding UCL AND beating off BT to get them would put Sky in a dangerous position in terms of their ability to remain upright!

I do agree that EUROSPORT are a contender, and i honestly think it will between BT & ES.
I don't think Sky will even send in an application to tender!
LOSG
02-09-2016
Originally Posted by popeye13:
“The cuts and impact caused by the massive bill Sky has for the EPL rights IMHO takes them out of the equation for UCL rights.
They can barely afford the EPL and will be making some losses as a result of the cost, adding UCL AND beating off BT to get them would put Sky in a dangerous position in terms of their ability to remain upright!

I do agree that EUROSPORT are a contender, and i honestly think it will between BT & ES.
I don't think Sky will even send in an application to tender!”

They will only to keep BT honest. They'll want to make sure that BT pay the max that they are willing to, potentially then hindering BT in other future rights tenders.
madmusician
02-09-2016
Originally Posted by popeye13:
“The cuts and impact caused by the massive bill Sky has for the EPL rights IMHO takes them out of the equation for UCL rights.
They can barely afford the EPL and will be making some losses as a result of the cost, adding UCL AND beating off BT to get them would put Sky in a dangerous position in terms of their ability to remain upright!

I do agree that EUROSPORT are a contender, and i honestly think it will between BT & ES.
I don't think Sky will even send in an application to tender!”

I disagree. Look at the knockout money paid by Sky to get exclusive F1 from 2019. They will still spend big money on rights if they feel that they are rights that will drive subscriptions. Cutting production costs in ways that they feel will not affect the majority of subscribers (e.g. axing studio discussion shows, doing overseas cricket without studio, etc) is one step that they have taken to keep costs down, but that's small beer in a way. If Sky feels that they need the CL, then they will bid for it. As mlt11 has already said, they will certainly bid in order just to keep BT honest.

And I don't think Eurosport are an option. I think they're firmly positioning themselves as non-football rights holders, but in a more primary way than they ever used to be. E.g. keeping the US Open tennis rights for themselves, and taking the Olympics rights. But I don't think (and their big boss has gone on record to say this too) they'll be looking at domestic football. Setanta and ESPN showed that you cannot take on Sky at that game and win - BT are competing because they are fighting like-with-like - they have their own platform and infrastructure to take on Sky with. There is no place in the market, nor was there ever (IMHO), for a channel-only business to take on Sky in terms of domestic football.
Rich1977
02-09-2016
Originally Posted by madmusician:
“ There is no place in the market, nor was there ever (IMHO), for a channel-only business to take on Sky in terms of domestic football.”

As the market stands right now you are probably right but by the end of the decade all bets are off. On-line distribution of content will eventually completely change the playing field making a channel only solution marketable to far more people than the traditional market of he past which has been mostly limited to those who have access to Satellite or Cable.

I think the future is not very clear and hard to predict.
Gray77
02-09-2016
Originally Posted by Rich1977:
“I think the future is not very clear and hard to predict.”

Agreed, and this is when Sky will really show everyone how much they are willing to pay for the PL in a doomsday scenario. If Apple, Google or whoever decided to bid for PL football and submitted that bid on the premise that those games would be shown independently of any satellite, digital or cable provider through their own apps, via Apple TV or on password accessed site on YouTube, it could change the game.

Apple would IMO instantly reduce the fee for an Apple TV box and allow millions of people to watch PL without needing to subscribe to Sky or BT, with an Apple TV box and a monthly sub all people would need. I can currently watch NFL, NBA, MLB and WWE through their own in-house streaming services which sit on formats like Apple TV. I can watch them in HD on my TV without thinking about Sky or BT.

If a situation ever arose where that became a reality for PL games, all bets would be off. Sky will be aware of the menace that is Apple and Google, and with iPads and iPhones now evolving from luxury items to everyday items that do not sell in such high numbers every time there is a new model I think Apple will have their eyes on new ways to attract people. TV is the model, but not TV via traditional ways, but rather through their own service.

This is when we will see what Sky are really prepared to pay for their flagship contract.
LOSG
02-09-2016
Originally Posted by Gray77:
“Agreed, and this is when Sky will really show everyone how much they are willing to pay for the PL in a doomsday scenario. If Apple, Google or whoever decided to bid for PL football and submitted that bid on the premise that those games would be shown independently of any satellite, digital or cable provider through their own apps, via Apple TV or on password accessed site on YouTube, it could change the game.

Apple would IMO instantly reduce the fee for an Apple TV box and allow millions of people to watch PL without needing to subscribe to Sky or BT, with an Apple TV box and a monthly sub all people would need. I can currently watch NFL, NBA, MLB and WWE through their own in-house streaming services which sit on formats like Apple TV. I can watch them in HD on my TV without thinking about Sky or BT.

If a situation ever arose where that became a reality for PL games, all bets would be off. Sky will be aware of the menace that is Apple and Google, and with iPads and iPhones now evolving from luxury items to everyday items that do not sell in such high numbers every time there is a new model I think Apple will have their eyes on new ways to attract people. TV is the model, but not TV via traditional ways, but rather through their own service.

This is when we will see what Sky are really prepared to pay for their flagship contract.”

Of course Sky itself will move into that direction as well - and has already started too.
stato77
02-09-2016
Originally Posted by Gray77:
“Agreed, and this is when Sky will really show everyone how much they are willing to pay for the PL in a doomsday scenario. If Apple, Google or whoever decided to bid for PL football and submitted that bid on the premise that those games would be shown independently of any satellite, digital or cable provider through their own apps, via Apple TV or on password accessed site on YouTube, it could change the game.

Apple would IMO instantly reduce the fee for an Apple TV box and allow millions of people to watch PL without needing to subscribe to Sky or BT, with an Apple TV box and a monthly sub all people would need. I can currently watch NFL, NBA, MLB and WWE through their own in-house streaming services which sit on formats like Apple TV. I can watch them in HD on my TV without thinking about Sky or BT.

If a situation ever arose where that became a reality for PL games, all bets would be off. Sky will be aware of the menace that is Apple and Google, and with iPads and iPhones now evolving from luxury items to everyday items that do not sell in such high numbers every time there is a new model I think Apple will have their eyes on new ways to attract people. TV is the model, but not TV via traditional ways, but rather through their own service.

This is when we will see what Sky are really prepared to pay for their flagship contract.”

Sky spent £4.2 billion to acquire their Premier League TV rights for 16/17 to 18/19 or £1.392 a season.

If Apple, Google or any potential broadcaster acquired the rights to the same packages, and made these matches available for a monthly subscription, they would need the following number of monthly subscribers to break even on the rights costs alone.

@£39.99 a month – 2,900,725 subscribers
@£29.99 a month - 3,867,555 subscribers
@£19.99 a month – 5,802,901 subscribers

These figures are based on those subscribers actually subscribing to the packages for 12 months of the year.

These figures don’t take into account any future rights inflation or the need to beat off competition for the current incumbents.

Sure, £5 billion might be a drop in the ocean for Google or Apple, but there has to be better ways for them to invest their money.
ftakeith
02-09-2016
http://sport.bt.com/football/news/bt...11364083594868

leicester's first game on bt sport showcase
samburrows
03-09-2016
Originally Posted by stato77:
“Sky spent £4.2 billion to acquire their Premier League TV rights for 16/17 to 18/19 or £1.392 a season.

If Apple, Google or any potential broadcaster acquired the rights to the same packages, and made these matches available for a monthly subscription, they would need the following number of monthly subscribers to break even on the rights costs alone.

@£39.99 a month – 2,900,725 subscribers
@£29.99 a month - 3,867,555 subscribers
@£19.99 a month – 5,802,901 subscribers

These figures are based on those subscribers actually subscribing to the packages for 12 months of the year.

These figures don’t take into account any future rights inflation or the need to beat off competition for the current incumbents.

Sure, £5 billion might be a drop in the ocean for Google or Apple, but there has to be better ways for them to invest their money.”

Good post, thank you.

In an average household where broadband + phone are now standard utilities, you can add £30-£40pm spend to those figures. At the middle of your price points (£30pm) that equates to a £60-£70pm for a phone, broadband and 38 live football matches per year, of which the average fan (we know from Sky's own research) will watch about 10-15.

Compare that to a bundled package from BT & Sky, which includes other content for not that much more per month and I am sure most families would choose the latter.

The model Gray77 eloquently describes works very well for those sports in an international context where there is only a niche (sorry, couldn't help myself) fanbase. It wouldn't surprise me overly if the Premier League thought about its own direct-to-home channels for some international markets in the future, although their current strategy wouldn't appear to need much deviation right now.

In terms of current domestic consumption though, I find it hard to see a business model which (a) meets the current valuation of Premier League / CL rights and (b) can break even without relying on cross subsidy and promotion of other communications services.
Gray77
03-09-2016
stato and samburrows, both good points well made. The economics are hard to justify for any company to challenge Sky and BT without an existing infrastructure to go along with any PL games.

Amidst the inane dribble about licence fees and 'niche' sports on this forum it is refreshing that we still have good posters making good points in some of these threads.
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