From MediaPro to DAZN: Serie A’s remarkable rights battle that saw a billion-dollar deal disappear

SportsPro looks back over an Italian club soccer saga that bounced from Catalunya to the Court of Milan, and ended with Sky Italia and Perform picking up the pieces.

From MediaPro to DAZN: Serie A’s remarkable rights battle that saw a billion-dollar deal disappear

Last week Sky Italia and Perform won the Italian TV rights to Serie A, the top tier of the country’s soccer pyramid, with the overall value of the deal reaching €973m per year.

The deal, which runs until the end of the 2020/21 season, will see a satellite broadcaster and an over-the-top (OTT) platform work together for the first time in Italian soccer history.

This, however, tells only the smallest aspect of an unprecedented and protracted case that saw the original tender between Serie A and MediaPro, a Catalunya-based, Chinese-owned multimedia communications group ruled invalid in Italian court with several more rumblings between.

What is the background?

Indeed, the rights were originally sold on 5th February, to neither Sky Italia nor Perform. Sky’s original outright bid of €830m (US$960 million) had been rejected in January.

It would be MediaPro whose offer would be deemed acceptable by Lega Serie A, the division’s governing body.

"The offer of €1,050,001,000 is superior to the minimum requested in the invitation to tender," a statement said of the left-field proposal. The offer was €1,000 (US$1,161) higher than the €1.05 billion (US$1.2 billion) set out by the league as a minimum target.

MediaPro's original bid came as a shock to Sky Italia and Mediaset, who had held the previous rights

The initial validation of MediaPro’s bid added Serie A to the company’s burgeoning European soccer portfolio. The organisation already possesses La Liga rights in Spain, while it also holds the rights to Spain’s Champions League coverage. In May, MediaPro further bolstered it holdings by claiming a portion of the rights to broadcast a selection of Ligue 1 fixtures in France, seeing off competition from Canal Plus.

However, a recent report in Spanish newspaper El Español suggested that Jaume Roures, chief executive of MediaPro, was considering withdrawing from Spanish soccer at the expiration of its agreement in 2019 because of the fractious nature of rights deals no doubt exacerbated by Mediapro's Serie A debacle.

The ‘intermediary’ status at the centre of the controversy

The unease caused by MediaPro’s bold arrival at the Italian negotiating table exemplifies the issue facing Roures’ business.

It has seen MediaPro have its offer accepted, then suspended and then, ultimately, rescinded and dismissed as inadmissible.

At the crux of the controversy is the notion of the ‘independent intermediary’ and whether MediaPro can legitimately be seen as such.

Sky spoke out following its initial defeat in February, stating that MediaPro’s bid – simply – was ineligible.

A Sky statement declared: “Given that the Spanish audiovisual group Mediapro - despite having submitted an offer for the specific call for proposals addressed exclusively to ‘independent intermediaries’ - it would not operate as an independent intermediary but as a true communication operator.”

Juventus have won Serie A in each of the last seven seasons

The statement ended with a direct request to Lega Serie A to end private discussions with MediaPro, and to exclude them from the remainder of proceedings.

Sky maintained that MediaPro did not qualify as either independent or intermediary and should not have been permitted to bid in a part of the process reserved solely for independent intermediaries, given the media company’s desire to introduce its own channels to broadcast some of the fixtures.

Sky also argued that due to the MediaPro model, the new rights holders would not have the capacity to distribute the fixtures among the Italian market.

Under the terms of the previous arrangement, Mediaset and Sky Italia had been able to purchase the rights directly from Lega Serie A. The structure of MediaPro’s product was such that its acquisition of the rights would then be followed by a second layer of distribution, with MediaPro selling the fixtures on in different packages to prospective buyers.

Sky maintained that MediaPro did not qualify as either independent or intermediary and should not have been permitted to bid in a part of the process reserved solely for independent intermediaries

The beginning of the end

A formal complaint followed as MediaPro revealed its plans for the distribution of fixtures. A range of channels devoted to Italian soccer was mooted, with further distribution and streaming of content across multiple platforms.

Roures said: “This system does not work if we and all the platforms do not work together. We aim to create an immediately recognisable Serie A brand so we will try to convince everyone that it is important to give the same image to the whole tournament.”

The court interpreted the situation in the same way as Sky Italia had done

MediaPro’s tender with Serie A was subsequently suspended on 16th April, before Judge Claudio Marangoni at the Court of Milan ordered that the agreement be cancelled and reformulated, ruling that the deal breached antitrust rules.

Marangoni sided with Sky, stating that the nature of MediaPro’s offer possessed what he described as “a form of editorial responsibility”, placing it “outside the sphere of activity of the independent intermediary.”

Reaction

Sky praised the judge’s interpretation of the law and offering to step in with “an important offer that can give certainty to all fans and at the same time guarantee the future of the clubs and the whole football system.”

Meanwhile, MediaPro defended its own actions, accusing Sky of acting out of fear for its own place in the Italian soccer market and suggesting that the legal decision reflected a favourable attitude towards Sky as a satellite broadcaster.

It said: “MediaPro regrets that Sky’s fear of losing its controlling position in the rights market is causing concern among the professional football sector in Italy. The situation is not of MediaPro’s making.”

MediaPro suggested that Sky had reacted out of fear at losing its grasp on the Italian soccer market

On 29th May, the decision to officially terminate the rights deal between Lega Serie A and MediaPro Group was rubberstamped. It was an inevitable conclusion to a deal that – from its very outset – was viewed in some quarters with concern and derision.

A meeting of all 20 Serie A clubs unanimously confirmed the parting despite an appeal from the Spanish agency.

What does this all mean for DAZN?

If that particular episode is now in the past, with Sky and Perform now in possession of this next three-year cycle, what the future brings might even be more intriguing.

The Silvio Berlusconi-founded Mediaset, who held a portion of the previous set of rights, has stated that it will “seek retransmission rights immediately”, having lost out both to MediaPro and in the renegotiated deal to Sky and Perform.

Perform’s live and on-demand streaming service, DAZN, will expand into Italy for what is an entirely new experience both for Perform and for Italian soccer. Under the terms of Perform’s deal, DAZN will exclusively show the Saturday night fixture, Sunday matches at 12:30pm and 3pm, as well as games in each midweek round and highlights from all other games.

Matches shown on DAZN will be available across smart TVs, PCs, smartphones, tablets and games consoles. DAZN will allow all fans a one-month free trial of the service before a €9.99 per month subscriptions kicks in.

“DAZN is the world’s first pure sport OTT offer, which will do for sport what Netflix did for TV and what Spotify did for music”

“Since launching almost two years ago, we have disrupted the industry in multiple markets as we change the way the world sees sport,” said James Rushton, DAZN chief executive.

Adding: “DAZN is the world’s first pure sport OTT offer, which will do for sport what Netflix did for TV and what Spotify did for music.”

Given how we got to this point, Serie A does not need any more ‘disruption’ of its media output, at least from a delivery standpoint. With the Italian league's bold move into OTT followed by a series of high-profile streaming pitfalls for Optus at the World Cup, Lega Serie A will be hoping the ride is smoother from here on in.