Ofcom, the Premier League…and a kick in the teeth for fans
As Ofcom kick-starts its investigation into Premier League TV rights, Raymond Snoddy says, as usual, it is the fans who will suffer the most in the search for “perfect competition”.
The great thing about football is that you never quite know what is going to happen next. The same goes for TV football rights auctions.
Just when we were settling down for the planned multi-billion derby match between Sky and BT for the future of live televised football, it seems the rules of the game could change dramatically.
Virgin Media, which is unlikely to be a mainstream player in the do-or-die-contest, has managed to kick the ball away, at least for now, by persuading Ofcom to investigate the whole process under competition law.
As usual, the danger from any tinkering is that it will be the consumer interest – the fans – who will suffer most from the search for perfect competition.
We already have the situation where at least two of the seven packages of rights have to be held by the “losing” team. Sounds good. How can you criticise intensifying competition as opposed to the evils of monopoly?
Except that because live television sports rights are the most time-sensitive of commodities, the effect of increased competition is simply to drive up prices. Most of the money, around £1.6 billion a year, goes straight into the pockets of Premiership players who are now on an average of £2 million a year.
Someone has to pay and obviously the money is extracted from the fans.
The Premier League may be a three-ring circus attracting some of the best players in the world but it is an expensive affair – both to attend and to watch on television.
Even before Virgin’s intervention, existing transmission schedules, often changed relatively late in the day, can cause mayhem for loyal season holders.
On a personal level it was infuriating to miss the last two home games of my favourite team – QPR since you ask – because kick-off times and dates had been changed from the eagerly awaited 3pm Saturday kick-off.
That’s where we are now. Fans accept, sometimes rather grumpily, the trade off between seeing attractive and sometimes world-class football and having to turn up at odd hours any time between 12.30pm on a Saturday through to Monday evening and beyond.
The latest inquiry could cause even more pandemonium.
The first Virgin complaint is that the “collective” selling of Premier League rights is in itself a breach of European Competition law.
In the strictest interpretation of competition sense it sounds like a restrictive practice – the coming together of 20 commercial entities to carve out a monopoly advantage.
The problems arrive when you start to consider the alternatives. It would be perfectly competitive for each club, or groups of clubs, to sell their rights individually. The result? Total chaos and a probable collapse in rates.
The collective that is the League is also a redistributive mechanism that gives small clubs a chance to at least compete financially, enhancing the overall quality and unpredictability of outcomes.
Top clubs with international fan bases could scoop up, and keep, the lion’s share of the television rights money, ultimately undermining the credibility of league games.
Even in the US, the home of ferocious anti-monopoly regulations, sports leagues are recognised as exceptions, free to combine to negotiate rights as a single entity.
Ofcom should not waste too much time on this issue.
Virgin is on much firmer ground when it notes that the number of games made available for live transmission is only 41 per cent – by far the lowest among the main football nations of Europe, and also the most expensive.
Presumably the reason is the link between frequency and cost. You restrict the number of games and create a scarce commodity that can attract a premium price.
The other is protecting attendances and both gate revenue and the atmosphere that comes mainly from a packed stadium.
In Italy, for example, the best teams can play to half empty stadiums, though referee fixing and crowd violence may be greater factors here than television.
While many will remain addicted to the live experience, if you show all the games on television, it would hardly be surprising if many watched at home or in the pub, undermining the spectacle of the game itself.
The other small practical issue is deciding when all these games would actually be shown.
Show six games at the same time at 3pm on a Saturday and they would cancel each other out and viewing figures and rates would plummet. Spread them out over the week and fans who want to attend would be driven mad.
Ofcom has promised it will take into account the views of fans and this is to be welcomed as long as the communications regulator really pays attention, as opposed to merely touching all bases in a mechanistic exercise.
Given the speed of an Ofcom inquiry it could be years before the deed is done and we will all be deep into the next three year TV deal.
By then there could be a much more even split between Sky and BT on the packages, much to the annoyance of fans.
It is truly remarkable how complicated a matter it is to assign live television rights to 22 men chasing a leather ball.
While we await the views of Ofcom, the only hope for redress for fans must lie with the Premier League itself as it prepares to launch the big auction in the New Year.
All the evidence from last time was that this is not a single blind final bid – winner takes all or nearly all. It was a managed auction involving rounds of bidding and it was likely that Sky was warned after the first round that it would have to sharpen its pencil.
Within reasonable limits the Premier League could steer events towards an outcome that might satisfy all parties, including, please, the fans who make it all possible.
Being prepared to accept something less than the optimum cash sum might therefore help.
Even at this late stage, creating a modest eighth package of games that would only be available to free-to-air broadcasters would be a nice gesture in the direction of fans who cannot afford pay television subscriptions.
But don’t hold your breath.