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Premier League unlikely to return to terrestrial TV

Wednesday, November 19th 2014 by

Football fans will not see Premier League matches on BBC or ITV in the near future, a football finance expert has said.

Speaking to Cable.co.uk following the announcement of an Ofcom investigation into Premier League TV rights, Rob Wilson, principal lecturer at the Sheffield Hallam University Sport Industry Research Centre, suggested that clubs won’t leave behind big money broadcast deals.

When asked if Premiership matches may return to terrestrial TV, Mr Wilson told us: “In the short or medium term, no. The running costs for all of these Premier League teams are so, so high, they need to generate revenue.

"Over the last 25 years, we’ve seen a move away from what we call natural match day spend, which used to be the lions share of any team’s budget. Now we’re seeing around 55% to 60% of club revenue being generated by broadcasting.

“20% to 23% is made from match day activity, so certainly in the short or medium term there won’t be any move away from these massive broadcasting deals. On the contrary I think the next broadcasting deal, irrespective of this investigation, will increase again.”

Premiership rights auctions have seen each new three-year broadcast period generate higher and higher levels of income for the Football Association.

The price for the latest rights deal – covering 2013 until 2016 – rose by 70% to £3bn when it was announced in 2012. However, Mr Wilson says that fans should expect the price to go up yet again when the new bidding window opens.

He added: “We’ll see a significant increase again when we hear about the next deal. When we break it down between domestic and foreign rights, what we’ll see is a leveling out of the domestic fees because I don’t think there’ll be many more games that they can broadcast.

“The value of any single game is around £2m now, just to broadcast one game, so I think the domestic market will level out at around the £3.5bn mark.

"I think more exploitation will be made from foreign rights, breaking those up by territory, by country… just selling the Premier League in China could generate upwards of £1bn if they wanted it to.

“Then we have to factor in Australasia, India, the Far East, Africa, the Middle East, this huge new market that we seem to be tapping into in the United States, so I think the total deal will increase a fair amount but it’ll be driven by foreign rights.”

As part of the investigation, Ofcom will consider whether there has been a breach of UK and/or EU competition laws and if the existing Premier League deals "restrict or distort competition" amongst UK TV broadcasters.

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