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October 2020
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Clubs struggling to pay broadcasters refund; TV wants more concessions

By Tony Attwood

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The size of the financial problem facing some Premier League clubs has been revealed through leaked reports of the arguments between clubs following the TV companies’ demand for refunds on the money that they have already handed over to the clubs for the right to show games.

But while the bigger clubs are happy to accept the deal when it means bringing money in, they are concerned about having to pay the money back.  In the process they are revealing that even some of the bix six are suffering from a lack of ready cash.

As a result, according to press reports, the clubs have already negotiated a deal with TV that means the top six clubs from last season will not have to pay back the money they owe, but can deduct it from the money they are due to receive during the next two seasons.

Thus Arsenal and the other top six clubs from last season will have their income reduced by £15m each per year over two years, while the rest of the clubs will have their fees cut by just under £6m each.

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But it seems even this compromise is now being rejected by the clubs, reflecting how much of a financial hole they are in as a result of having no gate receipts, season ticket refunds, no catering profits etc etc.

According to the Mail, Liverpool will argue the strongest against paying the £330m rebate to the broadcasters, although the League’s broadcasting committee have presented it as the best deal available to the clubs.

The TV companies however are adamant that they have real losses in terms of their audience in general, and the advertising and sponsorship they can sell around their football programmes.  These programmes of course not only consist of live games but a seemingly endless stream of pre- and post-match shows filled either with fans or what are laughingly called “experts”.

The companies also argue that because the games that will be played will be ghost games neutral viewers will be less inclined to watch as there will be no atmosphere.   Liverpool, Tottenham and West Ham, three of the clubs with the biggest holes in their budgets, argue that there should be no refund because of the ghost games, suggesting that audiences will be higher because no one has been able to go to games for several months.

As things stand, Sky and BT have rights to 47 remaining games – the other 45 will be shared, with Sky wanting to broadcast 32, BT Sport wanting eight and the remaining five being split between Amazon and the BBC.

The TV firms have also asked for cameras in the dressing room and technical areas, knowing of course that on this the clubs will say no, so that broadcasters can make the clubs look like the people who want it all and offer no compromise.

Outside the battleground between TV and clubs, the view is that clubs have to pay what TV wants, because of the contracts.  The issue then becomes one of whether clubs have been sensible enough to have insurance.  But if that insurance has “acts of God” exclusion clauses (which reduce the price of the premiums) even this won’t help the clubs.

What’s more, if the TV firms do compromise they will do it and then reduce the offer they make next time around.  The clubs however have no other way of earning £3bn a year.   Certainly the overseas TV market is as badly affected as the UK’s – so they are not going to offer huge amounts either.

In essence everything in football has been exploited to the full except one thing: Saturday afternoon football.  That is the only card the clubs have left to play as they try to reduce their losses.

1 comment to Clubs struggling to pay broadcasters refund; TV wants more concessions

  • Mike T

    The TV package for the 3 year cycle which 2019/ 20 was year one has significantly changed in terms of how the overseas money is allocated. Yes the domestic monies will be distributed as suggested in the article but the domestic rights element has decreased by around £130million per year.The overseas money has increased by around £300 million per annum but this increase will be paid by way of extra prize money heavily weighted to the top 6.

    The articles make reference to the top 6 but I can not find any mention to the rebates being based on last seasons positions my guess is that the rebates will be taken off the balancing payment and final distribution for 2019/20.
    Irrespective finishing outside the top 6 will impact significantly and although i can find the article from memory I think the suggestion in one blog was the estimated difference ( pre pandemic) was between finishing 6th&7th was going to be circa £14 million

    https://www.theguardian.com/football/2020/may/27/arsenal-women-fined-50000-over-sacking-of-autistic-coach