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Another week, another Premier League story.
After last weeks announcement of Pay Per View games, I thought it was going to be awhile before a new controversial story around Premier League rights would hit the headlines, but it was only a matter of days before a story broke that escalated the Streaming Wars in sports.
Last Sunday the story broke that Liverpool and Manchester United had been working on a plan dubbed “Project Big Picture” to change how the overall football pyramid in England would operate moving forward.
Smaller teams below the Premier League are in desperate need of cash as the majority of their revenues come from fans attending games.
To be cynical, it seems like a timely announcement of a rescue package to save these clubs while performing a power grab for the most coveted asset of the Premier League, media rights!
There are some good proposals that help the sustainability of the game that helps clubs from lower leagues like a £250 million cash injection and some interesting proposals for fans, like limiting the price of away tickets to £20.
But at the heart of the deal was that Premier League clubs would retain rights to 8 games to stream on their own digital platforms.
With Liverpool and Manchester United developing the overall plan, it is clear to see the upside for them in retaining these rights for themselves.
It is hard to know exactly how many fans a team has around the world, but there have been reports that Manchester United have 1.1 billion fans around the world.
If they could take the most important asset (live rights) and put it in the hands of the clubs and allow them to go direct to consumer there is massive potential to increase revenues.
Bundling these games in a “digital season ticket” would provide for a huge windfall in terms of revenue but also in terms of the data captured in such a transaction.
Clubs have a massive data problem. How many of those “1.1 billion” United fans are actually reachable by the club? How many of those “1.1 billion” United fans are in the clubs CRM tool?
I don’t know the answer but it is a tiny percentage.
Even giving away the games for free to fans who sign up and provide details like name, age, location, social accounts etc. would provide massive value to the club in terms of what they could then do with their sponsorship rights.
For sponsors, knowing who the fans actually are is a massive deal. Its great saying that we have 1.1 billion fans around the world but have the data of those fans is much more valuable to the club and sponsor.
Right now it is the broadcasters who own any data from the fans who watch the games, but how clever is that data? Do they know who the viewer supports? Do they know what social media platforms they prefer?
For me this is the Trojan horse in the deal that didn’t get the same attention that the rules changes to voting got. The voting changes are a massive shift from the 1 club 1 vote principal of the Premier League to date.
This voting change, giving the ‘Big 6’ clubs more power, would inevitably lead to the 8 games clubs can stream to their fans increasing over time.
The 'big 6’ ultimately have the biggest upside to this given their far larger fan bases than less established clubs.
The Premier League has built its success on its more even distribution of live rights as it keeps clubs competitive and allow the bigger clubs to take advantage of their size and prestige to do bigger commercial deals.
La Liga went for individual club rights deals which saw Real Madrid and Barcelona steal a massive lead over others as a result of their prestige and ability to draw an audience. This has since been changed to deliver a more competitive league.
If you have read my musings on sports, I have long been of the opinion that this ownership of streaming rights by clubs is the mecca for billionaires, private equity and oligarchs for investing in the clubs in the first place.
It has long been my assumption that the Glazers real interest in Manchester United was wanted to turn the club into a global media company and to keep as much of the revenues generated by media rights as possible.
The plan was rejected, ironically by all 20 clubs, including Manchester United and Liverpool but this will continue to crop up as the rights for the Premier League 2022-2025 come up for negotiation.
Have a great sporting weekend,
Will
