The Premier League TV rights for 2022 to 2025 will go under the hammer in the next few months. The outcome of that process could put the competition’s very existence at risk.
In 2018, the UK segment of the Premier League TV rights sold for £4.5bn, down from a £5.1bn high in 2015. The rights for the next three years are likely to demand a much lower figure. An increase in the value of overseas rights offset the fall in domestic packages last time, but with the global market in decline there is no guarantee of that again.
The overall picture will be a major concern for the Premier League, its member clubs, and ultimately the players whose salaries are effectively paid for by the revenues derived from TV monies.
Domestic rights values in 2015 and 2018 were driven by BT Sport bidding against Sky. More recently Amazon has joined the party, and it was looking good for the Premier League with a product that broadcasters were prepared to bid eye-watering amounts of money to win.
Now that competition has eased.
In late 2017 Sky and BT ended their dispute, allowing each other’s product to be shown on both platforms. Both are now satisfied with the rights they have and have since learned to work with each other.
One of the strategies at both Sky and BT is to cut down on their expensive sports rights spend. This potentially spells trouble for the Premier League.
Any rights auction needs aggressive bidders and new entrants to maximize the price. If Sky and BT are happy with their rights packages and there are no new entrants, this is likely to be reflected in the price.
Could Disney or Netflix buy Premier League TV rights?
Amazon recently entered the market, but it too seems happy with its package of 20 matches around the Christmas period and it appears unlikely they would want to bid for more.
Netflix and Disney could be potential suitors. But, again, sports rights have limited shelf-lives and they are both likely to stick with scripted drama which naturally has more longevity.
Outside of a highlights package, it is far too expensive for any free-to-air broadcaster to bid.
Alternative platforms such as YouTube and Facebook are also only likely to be interested in highlights clips. The wildcard could be the sports streamer DAZN.
The challenge facing the Premier League is that if it doesn’t maximise the value of those rights it is likely to face difficult questions from its member clubs.
There are already murmurings of a breakaway European Super League by the six biggest clubs which could easily resurface.
A failure to secure the cash Premier League clubs expect and rely upon could be the catalyst to make this happen.
The Premier League will need to think carefully on how it packages and sells the rights to maximize value for its member clubs.
Covid has changed many business models. Viewers, while desperate to return to live sport, have got used to watching televised games.
Could we see, for example, Premier League TV rights packages sold by member clubs to their supporter bases for all their away games?
All of this poses another question. What future does the Premier League as a body have if clubs revert to either selling their own rights or forming a breakaway European Super League?