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Tuesday, 25 January, 2000, 13:51 GMT
Broadcasters battle for football

TV match Media groups are lining up for a battle for broadcast rights


NTL's purchase of a stake in Aston Villa is the latest in the accelerating series of moves by UK media companies into the world of football ownership.

The days when the 'local lad made good' invested his fortune in his beloved hometown football team are disappearing at a rapid rate.

Granada succeeded in elbowing its way towards the front of the queue of media companies ready to take advantage of pay-per-view television matches with its alliance in July 1999 with Liverpool.


MUTV launch Manchester Utd already has its own TV channel
It joined satellite broadcaster BSkyB which, despite being barred by the UK government from taking over Manchester United, continued to own just under 10% of the club.

Following that BSkyB ruling, cable firm NTL dropped its plans to take over Newcastle United because of fears it would be barred as well. But again it retained a 10% stake in the club.

Other media companies have been keeping a close eye on clubs with London-based Carlton Communications constantly rumoured to seeking a stake in Arsenal.

What they are all keen on buying is content for their television channels.

Rupert Murdoch's satellite broadcaster BSkyB has shown that football is an unmatched way of attracting subscribers in the UK.

Hedge their bets

With the proliferation of new television channels as a result of digital technology, the battle is heating up to give viewers a reason to subscribe.

James Dow, head of business advisers KPMG's European football unit, believes that in time all the major English clubs will be either fully or part owned by media firms.

"Many companies value football as prime content for television," said Mr Dow.

"But the competition commission judgement on BSkyB set everyone back a bit. Taking a 10% stake is the sensible option at the moment, allowing media companies to hedge their bets."

The media firms are jockeying for position for the not-so-distant days when clubs may be able to sell rights to their matches individually.

A review is due to report in the next fortnight on whether Premier League clubs should be allowed to sell rights to matches en bloc.

Few in football expect it to rip-up the current deal with BSkyB, but if it did it would allow clubs to negotiate broadcast rights individually.

In that case Granada, NTL, and BSkyB hope that their shareholding would give them the edge in getting rights respectively to Liverpool, Newcastle, Manchester United, Aston Villa, Sunderland and Manchester City.


Silvio Berlusconi Media magnate Silvio Berlusconi profited from AC Milan
On the continent there is already pay-per-view coverage of matches - with media companies owning clubs such as AC Milan, Paris St Germain and Bordeaux.

With the continuing moves towards a European super league, UK media groups want to ensure they get a seat at the negotiating table.

Even if these developments do not take place as rapidly as expected, the UK media groups know that the 670m four year BSkyB deal to cover top flight English football expires in 2001.

Internet options

How better to back your own bid than to sit on the club's side at the negotiating table?

Liverpool's chief executive Rick Parry said that Granada had not bought the club's future TV rights. But his words suggest it has gone a long way towards doing so.

"They don't have any call on our future TV rights, they are coming in as a manager of our rights.

"If they choose to bid for the rights we have provisions in place to ensure there is no conflict of interest.

"With the Internet and burgeoning digital market we think there are even more opportunites now to exploit TV and broadcasting rather than just broadcasting live matches.'

The changing face of football means a partner is needed: "You may not like the way the world is going. You may wish it to be like the 1970's but it isn't and if we are to be the best in Europe again we have to compete off the pitch as well as on the pitch."

One thing for sure is that there are likely to be more of these alliances to come.

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See also:
13 Jul 99 |  The Company File
Granada buys stake in Liverpool FC

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