BSkyB Bids To Retain Premiership Prize
The Premier League could face investigation by European competition regulators if it accepts an all-encompassing £1 billion bid for live Premiership rights from BSkyB, according to press reports.
Friday saw the deadline for bids to show Premiership football for three years from the 2004/5 season. In a bid to appease the authorities in Brussels, the Premier League has increased the number of live games available to 138 and split them into three packages, called gold, silver and bronze. There are also re-runs and highlights packages on offer.
The European Commission has previously expressed disapproval at the way Premiership rights have been bought and sold with a single bidder, namely BSkyB, winning a monopoly to show live games. Under the current deal, the satellite broadcaster pays £367 million per season for top-flight league action.
The new procedure is intended to raise competition with bids expected from a number of broadcasters. However, such is the importance of football to BSkyB, that it is thought to of made a £1 billion offer for all three live rights packages to ensure that it retains ‘exclusivity’. The company has already indicated that it will pay less if it is forced to share the rights with other parties.
This creates something of a dilemma for the Premier League which is reluctant to rebuff BSkyB at a time when the cost of sports rights is on the slide. The Football Association has already agreed to reduce the amount it receives from the BBC and Sky for England internationals and FA Cup matches from 2004.
There is also speculation that BSkyB’s rivals will be unable to put up much of a fight in the Premiership rights auction. Merrill Lynch believes that the BBC has bid for the silver package of Monday night games or the third choice bronze package but only has £75m to £100m in its war chest.
It is thought that Channel 4 and Five are only interested in highlights offerings while the ITV companies are under pressure to cut costs and are unlikely to sanction major investment in live sport. Regular football would also be guaranteed to cause major disruption to terrestrial schedules.
Merrill forecasts that Sky will pay between £300m and £370m per year for a combination of the gold, silver and re-run packages but insiders have told The Independent that any deal which precludes ‘exclusivity’ will not generate nearly as much.
There remains the genuine possibility that BSkyB will retain all live rights to the Premiership, leaving the League to face the wrath of the the competition authorities. They may consider this a risk worth taking given all the circumstances.
Last week the BBC and BSkyB have finally reached an agreement with the Football Association over a new four-year television rights deal for England international games and the FA Cup (see BBC And BSkyB Announce FA Cup Football Rights Deal).
BSkyB: 0207 705 3000 www.sky.com
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