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Special report: English soccer finances part four – Looming TV rights deals and the betting problem

The Premier League and the WSL are gearing up for their next media rights tenders after the EFL secured a record domestic broadcast partnership, meaning English soccer is set to learn its financial fate for much of the remainder of the decade. In the final instalment of this four-part series, SportsPro assesses the commercial state of play across the domestic game.

7 August 2023 Ed Dixon

Given its mass appeal and commercial pull, it seems odd to describe investing in Premier League broadcast rights as a gamble. Yet that was the situation BSkyB found itself in more than 30 years ago.

The newly formed top tier of English soccer, which controversially broke away from the Football League, may have had the country’s top clubs on board, but it was a new and untested concept. In the end, pay-TV network Sky agreed to cough up UK£304 million (US$395 million) to broadcast the competition for an initial five years from 1992 to 1997.

The rest, of course, is history. The Premier League soon evolved into a global juggernaut, making Sky’s inaugural rights deal look like a relative bargain considering what it did for the company. The move ultimately cemented Sky as the original broadcast home of the league and established it as a major force in the UK market, having initially flopped when it launched with no soccer rights back in 1989.

Today, Premier League rights are among the most desirable in sport. The top flight’s current domestic contracts with Sky Sports, recently rebranded TNT Sports, Amazon Prime Video and BBC Sport, which run until the end of the 2024/25 season, are worth a collective UK£5 billion (US$6.5 billion).

Overseas fan interest, meanwhile, has led to lucrative international deals. US broadcaster NBC’s six-year contract, signed in 2021, is worth around US$2.7 billion alone. The Times also reported in February 2022 that media rights revenue from abroad had surpassed the value of the league’s domestic agreements for the first time.

As the Premier League’s broadcast exposure grew, so too did sponsorship interest. Barclays was the title partner of the competition before the league adopted a multi-partner model that has seen its sponsorship roster expand to include global brands such as EA Sports, Budweiser and Nike. Clubs continue to prosper commercially, regularly carving out new inventory to attract more partners. The sought after front-of-shirt deals attract annual eight-figure sums, with Manchester City topping the pile thanks to their tie-up with Etihad Airways, which also includes stadium naming rights and is worth a reported UK£67.5 million (US$87.7 million) per year.

Put simply, the Premier League stands unopposed as the world’s richest domestic soccer league. According to Statista, the combined revenue of the competition’s 20 clubs for 2021/22 was around €6.1 billion (US$6.9 billion). Now, as calls persist for more of that money to filter down the pyramid, the league is thinking even bigger.

High expectations

The Premier League’s rights deals have helped set it apart from other European soccer leagues, handing its clubs a chunk of cash other teams on the continent can only dream of. For context, the Bundesliga’s domestic broadcast income from live games is about UK£979 million (US$1.3 billion) per year – the second highest in Europe’s ‘big five’ divisions – but it is still dwarfed by the Premier League’s annual pot of UK£1.6 billion (US$2.1 billion).

Having rolled over its domestic rights contracts for the current cycle, meaning the value has remained largely flat since 2016, England’s top tier is now eyeing an increase for the three years starting from 2025/26. According to the Daily Mail, the league plans to up the number of televised fixtures from 200 to 270 a season and make fewer rights packages available in its next tender, moves it believes will encourage heftier bids.

Incumbent rights holders Sky Sports, TNT Sports and Amazon are all expected to be in contention, but the Premier League hopes the likes of Disney and DAZN will also enter the fray, although Apple recently ruled itself out of the running. Currently, Sky has the largest chunk of live games with 128 per season, while TNT and Amazon show 52 and 20 respectively.

“I think we’ll be looking at a modest rise, if any,” says soccer finance expert Kieran Maguire. “The broadcasters are under pressure from customers not to raise subscription fees by any more than necessary. I think the OTT broadcasters are interested but they remain to be convinced as to the benefits.

Premier League rights are the crack cocaine of subscription broadcasting. It acts as a loss leader to a certain extent for the broadcasters but when they factor in the impact that it has on churn, and the fact it has allowed them historically to increase subscription rates above inflation on a regular basis, I think they’ve been willing to go along with that.

“We’re operating in a far more sensitive consumer environment and, therefore, that limits what additional amounts they’re prepared to pay. At the same time, Sky without the Premier League is unthinkable. I think they will put in a very competitive bid.

“TNT, they’ll be interested, but they’re trying to work out what their USP is. BT certainly overpaid for the Champions League. Do they want to get their fingers burned again with the Premier League?”

The EFL’s new rights deal with Sky Sorts covers more than 1,000 matches from the Championship, League One, League Two and the EFL Cup per season

As the Premier League readies for its next domestic tender, the English Football League (EFL) has already secured a record five-year, UK£935 million (US$1.2 billion) deal with Sky Sports.

Running from the 2024/25 campaign to 2028/29, the arrangement will see more than 1,000 matches broadcast a season and consists of guaranteed payments of UK£895 million (US$1.16 billion) and UK£40 million (US$51.9 million) in marketing rights. It also represents a 50 per cent increase on the EFL’s current contract with Sky.

According to PA, based on the EFL’s distribution formula, Championship clubs will earn 46 per cent more in guaranteed broadcast income and clubs in Leagues One and Two will be 25 per cent better off.

“It’s how it’s distributed that is the key,” says Niall Couper, chief executive of Fair Game, a coalition of clubs and individuals aiming to improve the governance of soccer in England and Wales.

“It’s about making sure we can start getting the money being distributed to clubs that are well run, not the ones who are overspending.

“That will start changing culture, that will get people thinking, ‘if I want to have a slice of that pie, then I’ve got to change my ways’.

“It also means that you’re more likely to get people wanting to come into the game for the right reasons. The banks are more likely to lend money to those sorts of clubs because they’re the ones who are showing good governance and proper financial sustainability that isn’t happening [at the moment].”

US broadcaster NBC is paying a reported US$2.7 billion for its six-year Premier League rights contract

Time to hustle

While the Premier League braces for offers and the EFL digests its new contract, the Women’s Super League (WSL) is gearing up for its next domestic rights tender. The competition’s existing agreements with Sky and public service broadcaster the BBC, worth a reported UK£8 million (US$10.4 million), expire at the end of the 2023/24 season and the next deal will be vital to the league’s trajectory.

A lot has changed for the WSL since its current “game-changing” broadcast partnership was announced in March 2021. England’s victory at Uefa Women’s Euro 2022, which saw a record 23.3 million tune in for the final on BBC platforms, has helped turbocharge interest in the top flight, sparking a rise in attendances and viewing figures.

There is, though, a lot more on the WSL’s plate. Currently run by the Football Association (FA), the plan is to form a separate company to oversee the top flight and second-tier Women’s Championship independently. A search for the WSL’s first chief executive is also ongoing, while making the top division exempt from the Saturday afternoon television blackout is also being considered.

There are no shortage of opinions about what the future of the women’s game should look like. A report in April stated that Tottenham Hotspur chairman Daniel Levy was among those keen for the WSL to scrap promotion and relegation – something that could have a significant impact on clubs’ earning potential.

“The rationale is that if promotion and relegation is closed off, then the existing teams will ramp up their investment in the hope that they’ll generate a return in several years’ time,” explains Maggie Murphy, chief executive of Women’s Championship club Lewes FC.

“If you close off promotion and relegation, I don’t believe that all 12 clubs would increase their investment. It would actually lead to some of those clubs in the WSL easing off the throttle.

“I think there would also be a knock-on effect whereby investment within clubs, not just in the second tier, but also in the third tier and fourth tier, will stagnate. That would be bad for the game as a whole.”

The FA plans to form a new company to run the WSL independently

An independent review, chaired by former England international Karen Carney, has rejected the idea of a US-style closed format, appearing to make it a more unlikely prospect. Murphy also notes that, should the WSL become a closed-off competition, “60 per cent” of WSL games would happen in only three cities, hampering growth and participation.

“The women’s football ecosystem in this country is still incredibly fragile,” she continues.

“If you separate out the top 12 teams with an intent to saturate attention, finance and visibility to just them, you will choke off an entire ecosystem that is only at the very early stages of development.”

Murphy dismisses the general view that top women’s clubs should start making more money off the back of Euro 2022. While she acknowledges those conversations should be had, she argues the “hard entrepreneurial yards” must be prioritised to ensure sustainable commercial returns for the women’s game.

“What you need are hustlers, people who will scrap and fight,” continues Murphy. “I think it’s not enough to lean on existing teams that fulfill functions for a men’s side of a club. The environment is completely different.

“Some of those investments need to be made into people who can really hustle in order to generate a return and probably after a few false moves as well.”

Lewes FC chief executive Maggie Murphy believes the women’s soccer ecosystem in England remains “incredibly fragile”

One last bet

English soccer teams boast an eclectic array of commercial partners – Manchester United have even been mocked for finding space for an official mattress and pillow provider. Despite the broad appeal of clubs to local businesses and blue chip brands alike, the gambling sector is an industry that the game continues to cling closely to and where the biggest shakeup is incoming.

Betting companies are a tried and tested source of income for teams, particularly in the lower leagues, where clubs relied on revenue from partnerships with gambling firms to help them through Covid-19. But many feel the fusion of betting and soccer has become too intwined.

In a move many perceive as another attempt to demonstrate it can regulate itself, the Premier League has agreed to outlaw betting sponsorship from the front of matchday shirts from the end of 2025/26, though other inventory such as sleeve branding can still be sold to gambling companies. At the time of the announcement, eight top-tier clubs had deals with betting brands, totalling some UK£60 million (US$77.9 million) annually.

Until the new measures come in, top-flight sides have been busy striking shirt deals in the offseason, with Aston Villa, Burnley and Fulham all landing new partnerships with gambling firms. Campaign group Big Step has subsequently urged the UK government to intervene after it published its white paper on reform of the sector back in April.

“We welcome the white paper,” says Neil Banbury, interim chief commercial and marketing officer at Kindred Group, parent company of brands such as 32Red and Unibet, whose partners include Middlesbrough FC.

“We support the ambition to bring legislation into the digital age. But I also think it’s important we acknowledge that we are not moving from a set of rules that were set in 2005 to new rules that are being set now in this white paper. Much of what’s in the white paper has been the direction of travel for us and most businesses in the UK for some time.

“The way that gambling businesses are run in the UK now is completely different to how it was not too long ago. We know this is not necessarily the end of the process, but we look forward to continuing the conversation.”

Aston Villa are among seven Premier League clubs to have a betting brand as their main sponsor

The last few years have been littered with betting blunders on the commercial front. In 2021, Norwich City terminated their contract with BK8 amid outrage over sexually provocative marketing content. Spurs also severed ties with 1xBet in 2019 due to regulation breaches. Aston Villa have ignored fan calls to end their recent deal with BK8, which is licensed in the UK but reportedly carries out its activities almost exclusively in Far Eastern countries where sports gambling is illegal.

There is also the issue of problem gambling, which is not only affecting the average punter. In May, Brentford striker Ivan Toney was banned from soccer for eight months after breaking FA betting rules. The 27-year-old had been diagnosed with a gambling addiction and will now sit on the sidelines watching his team play in shirts slapped with Hollywoodbets branding.

Worryingly, Toney is not a unique case. Last month, Nottingham Forest defender Harry Toffolo was charged by the FA with 375 breaches of its betting rules.

Some clubs have set their stall out, with newly promoted Premier League outfit Luton Town committing to not putting gambling sponsors on their shirts. Athletes could also be given the right to refuse to wear betting logos on their kit on religious or health grounds if the government proposal is adopted into a new code of conduct.

“I think the Premier League and the gambling industry are absolutely delighted with the white paper,” says Maguire. “[Gambling] has been the most successful stakeholder in the Premier League. There’s no indication in the white paper addressing the thorny issue of advertising and marketing against the gambling industry, which makes a big fuss to say that we’ve now got a whistle-to-whistle ban.

“But [the white paper is] not addressing the normalisation and the legitimisation of gambling as an issue and it’s not addressing the problem gamblers as far as the gambling industry is concerned. [For them], a problem gambler is one who wins.”

Banbury asserts that the relationship between soccer and betting is a “natural one” and efforts are being made to ensure it can be a healthy union.

Clubs, particularly those in the upper echelons of the top tier, will continue to attract a wide assortment of brands. However, those further down that are heavily dependent on gambling partnerships may need to rethink their commercial strategy in the years ahead.

“The world of football finances outside of the Premier League is obviously a delicate one,” says Banbury.

“I don’t think necessarily that football clubs are too reliant [on gambling sponsorship], but I think it’s really important for the clubs that they maintain the right to do good commercial partnerships with a regulated industry.

“We are very interested to see how the white paper and the independent regulator impacts that balance because, clearly, everyone wants football to be healthy.

“If it’s not healthy from a financial perspective, it isn’t a great product.”

This is the final instalment of a four-part feature looking into English soccer’s finances. 

Part one: A tale of FFP, state ownership and bending the rules

Part two: Where the money’s coming from

Part three: A ‘New Deal’ for the EFL, parachute payments and a “royally screwed” pyramid

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