ECONOMICS OF THE MADHOUSE
THE arrival of Amazon as a broadcaster of live Premier League football is being greeted in the sports world as the second coming. But far from unalloyed triumph, it could well turn out to be a poisoned chalice.
There is already evidence the viewing public is fed up to the back teeth with the high cost of subscription football.
You have to be an extraordinarily devoted fan and in a high-income bracket to spend the equivalent of £95 a game to watch Huddersfield Town play from your sofa. It’s up to £1,000 in annual subscriptions to BT and Sky, and even then just 11 of their matches were screened live last season. Indeed, the extravagant prices paid by the pay-TV broadcasters to show live football represent the economics of the madhouse.
In BT’s case, the £3billion of investor money thrown at football broadcasting rights so far, and more over the next three years, contributed to the fall of BT boss Gavin Patterson.
The company’s new hardline chairman Jan du Plessis is clear: BT’s role is to be a UK infrastructure champion providing super-fast broadband speeds to customers.
He wants BT to have a laser-like focus on improving appalling customer service rather than taking on the giants of broadcasting.
Patterson initially saw rights to Premier League football as a means to dominate the broadband market by offering customers free access. But a lack of world-class broadcast speeds meant the strategy flopped.
As a result, BT has had to start charging for football rights, sneakily raising prices each year – much to the anger of fans.
So could the seemingly endless demand for football be on the decline? In the recent auction of rights to Premier League games from 2019-22, the price dropped to £4.46billion (still ridiculous) from £5.1billion.
Fast-changing technology could end the golden age of football broadcasting. With the arrival of Amazon, which plans to livestream matches, the Premier League has let the fox into the chicken coop.
Amazon has already outbid Sky for exclusive right to the men’s tennis tour, and an annual subscription to Amazon Prime of £79 is a huge bargain compared to a far higher subscription to Sky. Suddenly, online viewing of sports looks like the future.
Pity Gavin Patterson and the BT board didn’t see it coming.