Premiership soccer doubles overseas TV income to $1.2 billion

By Ryan Mills
Jan. 18 (Bloomberg) — The English Premiership cemented its status as the world’s richest soccer league by selling its overseas broadcasting rights for 625 million pounds ($1.2 billion), more than double the previous accord.

The league, which had already increased the value of domestic rights by 67 percent to 1.7 billion pounds, said today it completed the sale of matches to another 208 countries. The current three-year deal, in its final season, is worth 307 million pounds.

“We’ve seen big growth everywhere, but the really big jumps have been in Asia and the Middle East,” Premier League Chief Executive Richard Scudamore said in an interview with the Daily Telegraph. “No territories have gone down, but in some cases the rights have ended up being sold for three or four times the current amount.”

English clubs comprised eight of the world’s top 20 by revenue in 2005, according to accountancy firm Deloitte & Touche LLP. From next season, the league’s bottom team — currently Watford — will earn as much from television as the 27 million pounds that fifth-placed Tottenham made in 2006, an increase of 10 million pounds, the Premiership, said.

“We watch the Premier League because it’s the most exciting league,” Putu Dwi Astama, a tour operator on the Indonesian island of Bali, said in an interview. “I meet my friends, we get some beers and watch two or three games a weekend.”

Foreign Influx

The TV money, which accounted for 43 percent of clubs’ revenue in 2005, has attracted interest from investors. Iceland’s Eggert Magnusson said the new contracts influenced his decision in November to buy West Ham — one of six now under foreign ownership. Liverpool is in negotiations with a Dubai-based firm, and Newcastle has been in talks with two groups in the past year.

Even before the latest agreements, the Premiership’s 2005 sales of 1.97 billion euros ($2.55 billion) were 47 percent more than Italy’s Serie A. Germany’s Bundesliga and La Liga in Spain are the next biggest earners.

“The Premiership has won the battle,” said Nigel Currie, a director at U.K. sponsorship consultant BrandRapport.

The sale may help Scudamore in his battle with Sports Minister Richard Caborn, who is backing a Europe-wide plan to give more power to the game’s national associations. The Premiership last year hired former Metropolitan Police Commissioner John Stevens to investigate possible corruption in player transfers. Stevens is still probing 17 of 362 trades between January 2004 and January 2006.

“We’ve actually had our best year in all the time I’ve been here, bar none,” Scudamore said.

Wider Gap

The latest financial boost will, however, widen the disparity in revenue between the top tier and clubs in lower leagues and smaller European countries, whose teams compete with Premiership outfits in the Champions League and UEFA Cup.

While next season’s Premiership champion will make about 50 million pounds from TV, teams in England’s second-tier Championship make on average less than 2 million pounds, about the same as top clubs in Scotland.

“Television makes big clubs bigger and small clubs smaller,” Dermot Desmond, the largest shareholder in Scottish team Celtic, said in a September interview. “Scudamore has done extremely well and extracted a great premium for his product.”

Analysts including Joe McLean of accountant Grant Thornton have called for money to be redistributed more evenly.

Premier League spokesman Dan Johnson said today his organization would give 35 million pounds a year to the grass- roots game and would redistribute more money “in real terms and as a percentage.”