• Wed
  • Sep 17, 2014
  • Updated: 6:55pm

Battle looms for Premier League deal

PUBLISHED : Wednesday, 15 February, 2006, 12:00am
UPDATED : Wednesday, 15 February, 2006, 12:00am

Rivals of i-Cable may spend up to $1b to win bid for new three-year contract as broadcast rights may


turn non-exclusive


Competition among pay-television operators is set to heat up as the exclusive broadcasting rights for


the popular English Premier League (EPL) from the 2007-08 season are thrown open to bids, an


industry source said.


Bidding for the new contract to show EPL matches for three years from the 2007-08 season will begin


by the end of this year.


If the rights become non-exclusive, the existing broadcaster of the matches, i-Cable Communications,


is sure to face off against rival PCCW Now Broadband TV and its partner, sports channel operator


ESPN, which are keen to broaden content.


The two big players are likely to spend up to $1 billion for the rights, according to sources.


They said that under the new contract, the highest bid would not necessarily get exclusivity.


'The [Football Association] Premier League is said to be considering breaking up one right in one


country into a multiple-operator approach,' an analyst from a local brokerage said.


If the proposal were implemented, the EPL would no longer be regarded as a winner in channel


packaging.


Pay-television operators may need to compete on price rather than content offering.


Rights holder the FA Premier League is said to be working on a new system of match broadcasts


after the European Union launched a formal antitrust inquiry on the exclusivity arrangement of only one


operator per country holding the right.


The league had made a suggestion that it could implement a formal procedure for tendering new


broadcasting rights ensuring that there are at least two television stations offering live matches, but


the EU rejected it.


'It is still waiting for the final verdict from the European Union. The FA Premier League may reserve


the right of appeal to the verdict. It is too early to say what the impact on the local pay TV market will


be,' said Simon Dewhurst, a director of investment banking at broker CLSA.


Mr Dewhurst believed that the final arrangement for broadcasting rights would be the highest-bid


approach.


A market source said losing EPL exclusivity would not be disastrous for i-Cable. Only about 20 per


cent of its subscribers, or about 170,000 users, were EPL watchers.


'It won't be negative if i-Cable fails to win the new contract for the EPL broadcasting rights,' a local


broker analyst said.


The current EPL broadcasting contract cost i-Cable about $600 million for the three years ending in


May next year. I-Cable may need to add at least 20,000 subscribers per year if the cost of the new


contract rises 10 per cent to $660 million.


'I-Cable's bottom line may not be hurt by the loss of EPL rights, as it can save up to $200 million


programming cost per year,' the analyst said.


Meanwhile, i-Cable announced yesterday that its investment in film production had been well-received.


The first film, 49 Days, had surpassed the break-even point, company chairman Stephen Ng Tin-hoi


said in a press release.


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