CSL gets revamped deal for TV rights
The Chinese Super League and China Sports Media have renegotiated their broadcast rights deal amid concerns about how the new restrictions on foreign players might affect ratings.
CSM has extended the contract from five to 10 years, but will pay less per annum than the initial deal it signed three years ago after the CSL agreed to the adjustments at a shareholders’ meeting last Friday, according to Xinhua News Agency.
CSM purchased CSL broadcast rights for 2016-20 at a cost of 8 billion yuan ($1.25 billion) in 2015 but will now pay 11 billion yuan for the period 201625, qq.com reported on Thursday.
“The eight billion for five years deal was a dynamic estimation, and we want to enter a positive cycle,” said Li Yidong, CSM chairman.
“Every investor needs to profit from the growing soccer market. If there’s no business interest, there will be no sustainable development.”
In 2016, CSM sold exclusive two-year online broadcasting rights to technology giant LeEco for 2.7 billion yuan. LeEco then flipped the rights to PPTV for 1.35 billion yuan due to a cash crunch.
CSM had been looking for revised terms on its broadcast deal, fearing recently introduced Chinese Football Association rules to curb excessive spending on foreign imports and boost young players’ firstteam chances will hamper its ability to recoup its investment.
Since last summer’s transfer window, any club losing money has to pay a levy equivalent to foreign player transfer fees costing 45 million yuan or more to a youth development fund.
Starting next season, the number of under-23 Chinese players that CSL and secondtier clubs use must at least equal the number of foreigners used.
Teams must also have at least three under-23 players in their 18-man lineups and must start at least one of them in matches.
The reforms have resulted in a more frugal approach from CSL clubs, with this week’s $6.7 million deal for former Liverpool and Barcelona star Javier Mascherano the only high-profile acquisition so far in the current transfer window.
Mega-money deals for the likes of Oscar, Carlos Tevez and Hulk had seen some Chinese clubs rise to the top of the global spending charts.
However, a study by accounting firm PricewaterhouseCoopers exposed looming danger for soccer’s longterm health here, both on and off the pitch.
The study found that 16 CSL clubs spent a total of 11.01 billion yuan in 2016 but only generated revenues of 7.08 billion yuan, running with an average loss of 245 million yuan per club.
Meanwhile, investment in youth development has paled in comparison to transfer fees and player salaries.
The PwC study revealed that, on average, CSL clubs spent 32 million yuan on youth training in 2016 — only about 7 percent of their employee costs and less than 5 percent of their total expenditure.