Well, despite the proclamations that the global economic downturn would see a knock-on effect on things like TV money for the Premier League, it seems that the rest of the world disagrees.
The deal, which has taken over 12 months to put together, is worth £1.2 billion over 3 years. I've seen a number of commentators hail this as an almost doubling of the £625 million deal that expires at the end of this season, but actually that was a 2-year deal. Nonetheless, it represents an increase.
These short-form contracts are, to use the technical term, an absolute ball-ache to negotiate. I can't speak for the rest of the world, but in Asia, you have probably the largest market (India [South Asia but is included] and China are both 1 bn plus).
Countries of varying sizes — Brunei (400,000) to China (who really knows, but around 1.2 billion) means you have to be flexible about the rules of bidding. For instance, in countries where you have more than one broadcaster, they are not allowed to jointly bid.
Also, a lot of broadcasters are state owned. Many of these countries have military rule, or a democracy where the military wield a lot of influence. You can imagine how going into commercial rights etc. may be a little Thaksin, sorry, taxing...
A recent example: up until last week, Singapore was not going to be able to show the World Cup, as the price had more than doubled from 2006, and the broadcasters couldn't hope to recoup the money by bidding solo. At the 11th hour, FIFA's commercial agents allowed a joint bid — all in the interests of the $$$ eh?
Despite what some commentators think, Asia is not full of wealthy people. There are quite a few, but a cursory glance at average GDP figures show that most of these people won't be splashing out on a cable tv package (in countries where it's not shown on free-to-air, which is most).
In China, the TV rights holder for the Premier League had to pretty much sell it off to an Internet company after it tried charging for a service which was previously free; people protested, the Internet company offered to stream FOC (no doubt selling sign-up packages etc). Bear in mind that the PL is heavily endorsed out here with lucrative advertising, and programme sponsorship packages.
So, after setting some context, why is this good for EFC?
Firstly, it's guaranteed £20 million per year for 3 years for all PL teams. Remember, this is overseas TV rights only.
Secondly, the PL having negotiated this deal, and given what has happened recently with Portsmouth, are changing the payment terms. Someone correct me if I'm wrong, but currently PL payments are made in September and January, with performance payment at season end? With this new deal, payments will be monthly — around £1.7 million per month — so it includes payment during the close season.
I doubt this will stop some clubs hedging and still paying silly wages to players. But for a club that is trying to be fiscally prudent in a crazy environment, I would imagine Bill Kenwright, Bob Elstone and others are relieved when it comes to those cash flow projections.
So I'd like to ask readers three questions:
1) Do you think this will help, especially in the light of Portsmouth, or as this is still a minority part of the payment, will it make no difference?
2) Do you think this pay-on-the drip method would benefit Everton if it was extended to the whole of the TV payments (i.e. including domestic, but with performance still as an end-of-season one-off)?
3) Domestic readers — what do you think will happen at the end of the current domestic TV deal? Less... about the same... or more? Are people now switching off from Sky at home, and watching on the net, or down the pub (especially if 3D comes off!)
Like the majority, my main concern is Everton first, the rest second. I think after the wake up call of Portsmouth that maybe, just maybe, the PL are going to start looking at how cash is disbursed. I mean, let's be honest — for the self-proclaimed best and richest league in the world to have a club go into administration, is a tad embarrassing to the global audience.
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1 Posted 22/03/2010 at 08:42:34
2 Posted 22/03/2010 at 10:55:22
3 Posted 22/03/2010 at 13:07:48
Conversely a friend of mine has recently switched to Sky form Virgin (no Sports sub tho') as they are offering very good deals to new customers, so I guess their customer base is not shrinking, meaning the money available to pay for PL rights is not decreasing. I reckon the new deal will be roughly the same, maybe a small increase for inflation.
4 Posted 22/03/2010 at 13:35:46
However, have we seen a top when it comes to money being spent on wages? Is Rio worth what he is paying paid now, is JT? Wenger might actually be the canary in the coal mine here. With Moyes right behind him. I don't want to make this an argument about wage structures, but I think the clubs are finally coming to realize that if Rio or Ronaldo walks because of wages being better someplace else, then so be it. You can cover and still win, IF you have the ability to find talent and bring them in. Wenger surely has done it with the Arse. And, do you really think that ManCity would make the Lescott deal TODAY?
5 Posted 22/03/2010 at 15:05:20
6 Posted 22/03/2010 at 21:59:58
7 Posted 22/03/2010 at 22:52:12
It's good to see the lads scoring regularly and the supporters reasonably confident going in to games that we will probably win.
For some reason, I just have this gut feel that we are on the cusp of a changing of the guard in the Merseyside battle!!!! The RS are self destructing and we're steadily on the way up. Won't that be good if it's right? after all these years.
8 Posted 23/03/2010 at 08:14:50
Next season will be either chaos or a major rebuilding job over that side of the park. We NEED to have a good pre-season and especially a good start.
Particularly since Chelsea aren't getting any younger, either. They can still afford to buy new players but who's to say they'll get it right? Wonder if they'll have another new manager next term?
9 Posted 23/03/2010 at 11:06:53
10 Posted 23/03/2010 at 11:06:53
11 Posted 23/03/2010 at 14:40:05
12 Posted 23/03/2010 at 22:12:05
I'd go along with the suggestions of finding another striker who really knows where the net is. As for the other position - manager - my view is that we have the best one in the PL even with some of the previous tactical mistakes. We've played some crappy stuff at times but, lately, we've also played some fantastic football, too! Still young as managers go, he's prepared to learn.
13 Posted 24/03/2010 at 14:47:45
12 months on and Alonso no longer wants to play for Benitez, and admittedly, they get a cool 30m from Madrid.
The guy is a fool in the transfer market. Why do you think the board balked at paying 18m for Barry?
Shades of Steve McManaman. (I know him, his old man is a mate of mine etc etc). Treat players like shite, they'll shit on you.
One good aspect about Moyes is the stories you hear about dressing room unity - despite what RS mates who know someone etc. triy to wind me up over.
Acquilani. Ha ha. Good scrabble score. And, er, that's it?
14 Posted 24/03/2010 at 23:52:13
SOF was signed to a shit side taking a gamble how many years ago. And here we are. He used the money available (not much for years) building ManU to the international juggernaut it is.
Now Moyes (assumingly) has some money to play with. The amount does count, but how he spends it is critical, not throwing it at a famous name.
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