FA Premiership TV rights: The Premier League averted a financial meltdown at England's top clubs yesterday after a last-ditch agreement that dealt with European Commission objections to their £1.024 billion (€1.8 billion) deal with BSkyB.
Premiership teams will still face a drop in income from the start of next season, however, after BSkyB agreed to give up their exclusive coverage of the league and sell up to eight live matches per season to a rival broadcaster.
As a consequence, the pay-TV company will demand to pay less for the contract, which runs from the summer of 2004 for three years, but it is understood that the cash shortfall will not be life-threatening for the clubs.
Brussels officials threatened to pull the plug on the new deal after describing the rights-selling process as anti-competitive last December. Club chairmen feared the Commission would force the league to scrap the deal, or demand that BSkyB offer one of four rights packages to a terrestrial broadcaster such as the BBC or ITV. Either scenario would have resulted in the 20 clubs suffering a significant fall in revenue.
However, the broad terms of a compromise solution were thrashed out between the Premier League chief executive, Richard Scudamore, and the European competition commissioner, Mario Monti, in intensive talks this week.
Yesterday's deal means live Premiership football could appear on British terrestrial television next season for the first time since the league was founded in 1992, with BSkyB offering the quota of up to eight live games a season to a rival.
RTÉ announced in October that they had agreed a deal for live coverage of Premier League matches next season. Up to 15 matches will be shown as the result of a deal reached by the FA Premier League, RTÉ and Setanta Sport.
The deal will last three years and see games screened live in Ireland on Saturday afternoons, starting in season 2004/05.
In addition, Setanta Sport has secured a deal making a further 15 pay-per-view matches available on Saturdays when RTÉ is not broadcasting a live game.
In Britain, ITV, the BBC, Channel 4 and Channel 5 are all expected to be interested in the eight sub-licensed games, but ITV and the BBC will find it difficult to schedule the matches. However, ITV could put the games on its increasingly popular ITV2 digital channel.
A spokeswoman for the commission said "high quality" matches would be put up for sale by the pay-TV group, but the games will be chosen from the least valuable package of rights. Rival broadcasters will choose from 31 games a season played at 5.15 p.m. on Saturdays.
The compromise was presented to Premier League chairmen by Scudamore at a meeting in London yesterday. A league source at the meeting said the chairmen did not want to break up BSkyB's monopoly of live football, but they accepted the deal in order to protect the financial security of many of the clubs.
"The mood at the meeting was a bit sombre because obviously we are giving up certain rights, but I think in the final analysis common sense has prevailed. Premier League clubs didn't want this issue hanging around over them. There was concern about the impact this could have had on our finances," said the source.
The feeling among chairmen is that Scudamore has saved his job with yesterday's last-ditch deal. Brussels regulators were furious that the league agreed a new contract with BSkyB in August before ironing out an EC-approved deal.
After the 2006/07 season, BSkyB's stranglehold will be loosened even further and any future auctions of Premiership TV rights will have to be split between at least two broadcasters in the interests of fair competition.
"The Premier League will create balanced packages of matches showcasing the Premier League as a whole, and no one broadcaster will be allowed to buy all of the packages," the commission said in a statement.
Announcing the deal in Strasbourg, Monti said fans would be the ones to benefit.
"This means that for the first time in the history of the Premier League, free-to-air broadcasters will be able to show live Premier League matches. There are very real concerns about the way the Premier League has been treating fans in the UK and this two-stage approach will safeguard the interests of fans now and in the future."
