The contractual battle

The news today that the BBC have won the rights to screen The FA Cup from the 2014-15 football season alongside BT Sport means that it is another contract battle that has been resolved. It is very good news for both, but from differing perspectives.

For BBC, it means that they have secured a contract which lasts a significant duration. The contract signed between them and The FA will last until the end of the 2017-18 season. It is the latest in a long line of contracts which is now secure for the next three years or more on the BBC:

– Premier League – expires 2016 (source)
– The Open Golf – expires 2016 (source)
– Wimbledon – expires 2017 (source)
– Six Nations Rugby – expires 2017 (source)
– The FA Cup – expires 2018 (source)
– Formula 1 – expires 2018 (source)
– Olympic Games – expires 2020 (source)

For BT Sport it means that they retain the cup having inherited ESPN UK’s contract for this upcoming season. For the moment on the contractual front, there is a breather before the next round of negotiations start concerning the first few of those contracts – rumours are already beginning concerning the Open Golf and Wimbledon, for example. I don’t expect any of the contracts, including Formula 1, to be broken half way through. I’d be incredibly surprised if that happened.

As for what happens with those contracts, attention now turns to the launch of BT Sport. It is not necessarily the first few weeks what are vital, but the first six months – from August to Christmas. Yes, the first few weeks are important, but it is not all of a sudden game over if the viewing figures and reaction are not what they hoped for. BT in their channel analysis won’t be looking at just one rating or just one figure, but they will be analysing trends over the upcoming months.

If things do not go to plan, then unfortunately for them, Sky Sports will have the cards to potentially deliver a knock out blow later in the game and BT Sport will have to go back to the drawing board. If that does happen, BT Sport could end up the next ITV Digital or Setanta Sports. At this stage, it is impossible to say what will happen, but like I say above, we will be in a much clearer position come Christmas. On the other hand, if things do go to plan, and the uptake for the channel is better then expected, then in their words this could well be a ‘game changer’. Better than expected results mean that they can put more money in and also try and push the boundaries in what they can offer.

And that’s where the above contracts come in. BT will be in a position to say “we can bring audiences to the channel” which will lead to potentially many battles between them, Sky, BBC and ITV. With some spare funds, ITV a few years down the line could bid for any of them, although it has been noted previously that ITV overbid for The FA Cup (as did Setanta) so they may very well be glad to see the back of that deal. I know that some will probably disagree with me here, but it was in a way lucky that the BBC and Sky Formula 1 rights deal happened when it did. Had BBC seen out its contract (which originally would have expired at the end of 2013), right now in a parallel world, we could be seeing both BT and Sky both fighting for the Formula 1 contract from 2014 with BBC left out in the cold with highlights! Yes, two years ago no one, including myself, wanted to see Formula 1 on Sky. Hindsight is a wonderful thing, and in hindsight things could have ended up a lot worse than what they did. As for the next round of rights, if BT Sport is still running, it could be all for play for. And that’s not just for F1. That’s for any of those contracts.

Is that good for the consumer, you may ask? I don’t know. With the amount of money broadcasters are paying for lucrative contracts, it means that inevitably price hikes happen every so often. Whether BT Sport will continue to offer BT Sport free to all people with BT Broadband for example this time next year remains to be seen. From the outside, it will be fascinating to see what happens with BT Sport and whether they can walk the walk as well as talk the talk…

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3 thoughts on “The contractual battle

  1. Now where would the BBC have found all that cash for soccer from, I’m sure they said they had to cut back on sports rights 😀

    • The talk is that a few bits of money have been taken from other departments to fund the bid.

      BBC will see The FA Cup as an event that ‘brings the nation together’, hence why they did. Whereas F1 on the other hand, doesn’t. Yes, the F1 rates very, very well but unfortunately it doesn’t fall into the top band.

  2. It’s been good for me for the moment – I’ve been able to save £90 over the next year, by getting free unlimited broadband with Sky … even if it was fairly hard work. And that’s all thanks to BT’s pricing for the same products. That’s probably likely to be a rare moment of competition benefiting the consumer though.

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