Sky Faces Uncertain Future as Premier League TV Rights Auction Nears

Strategic Insights -

The upcoming auction of the UK Premier League TV rights is expected to be a contest between Sky, BT, and Amazon, with a new chief executive at the Premier League running the negotiations. The auction will take place against the backdrop of a rebellion by the so-called "big six" clubs, with the Premier League's cash cow entering the negotiations without the influence of the Murdoch empire for the first time since the 30-year-old competition was taken to pay-TV. Industry executives say the value of Premier League matches could sink by £500m or more from a total of £4.5bn last time round.

Key Takeaways:

  • The Premier League's cash cow will enter the negotiations without the influence of the Murdoch empire for the first time since the 30-year-old competition was taken to pay-TV.
  • The value of Premier League matches could sink by £500m or more from a total of £4.5bn last time round.
  • The auction will take place against the backdrop of a rebellion by the so-called "big six" clubs.
  • Sky, the current holder of the Premier League rights, is expected to enter the negotiations in a position of strength after managing to drive down the price of the current three-year deal by £500m compared with the previous auction.
  • Amazon, an opportunistic rights buyer, is expected to remain cost-conscious and not make a big bid for the Premier League rights.
  • Sports analysts say that after rampant inflation, sports rights deals are now coming in about 10% down on average as they are renewed.

Statistics:

  • The Premier League's cash cow is expected to enter the negotiations without the influence of the Murdoch empire for the first time in 30 years.
  • The value of Premier League matches could sink by £500m or more from a total of £4.5bn last time round.
  • The auction will take place against the backdrop of a rebellion by the so-called "big six" clubs.
  • Sky managed to drive down the price of the current three-year deal by £500m compared with the previous auction.
  • The Premier League's average annual income is around £3.3bn.
  • Sports analysts say that after rampant inflation, sports rights deals are now coming in about 10% down on average as they are renewed.

Sources:

  • "Sky set for uncertain future as Premier League TV rights auction nears", Mark Sweney, The Guardian, no date available
  • "Premier League auction: Sky and BT to face new rival from Amazon", BBC Sport, no date available
  • Richard Broughton, media analyst at Ampere Analysis, cited by The Guardian
  • Industry executive, cited by The Guardian
  • TV industry executive, cited by The Guardian
  • Executive who has negotiated deals involving Facebook and YouTube, cited by The Guardian