Radrizzani: Media rights market leader MP & Silva on course for up to $580m in revenue
Following on from significant growth in recent years and a diversification away from solely trading media rights to Italian soccer, the MP & Silva agency has lofty revenue projections for the year ahead, as group chief executive Andrea Radrizzani explains, as it continues to rival sports marketing’s ‘big three’ of IMG, Sportfive and Infront.
MP & Silva’s estimated annual group revenues of $350 million in the 2012-13 period marked another year of growth in turnover for the agency, as it continues to invest in media rights across various sports around the world and, in particular, build on its operations in Asia.
Revenues are set for a marked increase in the next 12-month period, according to Radrizzani, who said that the agency can now claim to be the market leader in terms of media rights revenue. He added: ‘‘The total MP & Silva group revenues on the current fiscal year 2013-14 should be in between $550 million to $580 million. In terms of annual media rights turnover, we consider MP & Silva is the agency with the highest revenues from TV sports rights business.
‘‘IMG has bigger volume of business as a corporate, but part of the revenues come from sponsorship, production, event and athlete management. Sportfive and Infront might have bigger revenues than MP & Silva in the years of big events they manage, such as the World Cup or Olympic Games.’’
Asked about MP & Silva’s profit margin for 2012-13, Radrizzani was also upbeat, saying: ‘‘The group is healthy and our accountants are still closing the balance sheets for the 2012-13 fiscal year, but I think we can expect a profit in the region of 10 to 15 per cent. From now, the company will be more focused on investing in rights that can guarantee a minimum level of margin and [being] more selective in the acquisition.’’
Radrizzani said that Asia currently represents 30 per cent of the group’s revenues and plans further growth in the region. Working with Al Jazeera, the ambitious Qatar-based broadcaster, the agency recently launched ‘beIN Sport’ channels in Indonesia, with channels also to be rolled out in the Philippines, Taiwan, Hong Kong and Thailand, and has also embarked on a project with the Olympic Council of Asia to manage its new in-house broadcast production arm.
Discussing MP & Silva’s plans for further growth in Asia, he noted: ‘‘The company aims to maintain the leadership as the main international football rights distributors and start to enter in local football opportunities. We are keen to support local leagues and federations to maximise their commercial values, especially in media rights assets. We have also started to expand our activities to production and sponsorship with interesting and important projects like the Asian Games in co-operation with the Olympic Council of Asia as well as the beIN Sport channels in Indonesia, Hong Kong, Thailand, the Philippines and Taiwan.’’
MP & Silva acquired Premier League rights in the Middle East and North Africa for the new contract cycle from 2013-14 to 201516, and, despite protracted negotiations in the region and public remarks from some broadcasters that the rights were overvalued, a wide-ranging deal was struck in July with Al Jazeera, which took over coverage from rival Abu Dhabi Media.
Radrizzani said that, in the MENA region, MP & Silva has not only “consolidated” a long-term partnership with Al Jazeera, which also bought other soccer rights from the agency, but that in the last couple of years the agency’s local office in Dubai has ‘‘opened relationships and increased the sales with many other local television broadcasters both at regional and domestic level.’’ He added: ‘‘We are working closely with local federations and leagues and we have increased our portfolio of rights with local sports.’’
In Europe, the trading of media rights to top soccer leagues naturally remains important, but the agency also has significant contracts in other sports, such as an agreement to sell media rights in Europe to tennis’ French Open and a deal to market international media rights to the European Handball Federation’s top continental clubs tournaments.
Radrizzani commented: ‘‘Obviously football is the leading sport in the ‘old continent’ and we aim to maintain our current football rights and be ready for new opportunities. At the same time we have a long-term co-operation with the FFT [French Tennis Federation] for Roland Garros, which is a key property for all broadcasters, especially coming when the football season is off. We have also prioritised handball, which has a good audience in the region and we will put our energy to develop the value of media rights working closely with the EHF.’’
The agency has significantly increased its turnover from Premier League rights after acquiring rights in a wider selection of territories in the invitation to tender process for 2013-14 onwards. Although it was replaced by rival IMG Media as the Premier League rights seller in Japan and Vietnam, MP & Silva picked up distribution rights in the Middle East and North Africa, Netherlands, Ukraine, Philippines, Taiwan, Indonesia, New Zealand and the Pacific Islands.
Asked about the success of the sales process, Radrizzani said: ‘‘The Premier League rights for the 2013-14 to 2015-16 cycle have been an important achievement and challenge for the company and we are satisfied with the result we have reached until now.
“For the first time, we are also exploiting the rights as a broadcaster with beIN Sport [in the southeast Asian territories] and we can know the precise return on the investment only at the end of the cycle.’’
Speaking to Sportcal earlier this year, Carlo Pozzali, MP & Silva’s chief executive for the Americas, predicted $60 million in revenues from that region in 2012-13, and also raised the possibility of opening an office in Brazil or Argentina.
Radrizzani admitted that MP & Silva is looking at new opportunities to develop in the Americas, but added that ‘‘usually we open our operations when we have acquired important rights and projects to set up in the territory. I hope these will happen soon.’’ This is an abridged version of an article that appeared on the Sportcal website in September and is available for subscribers to read at http://www.sportcal.com/news/ news_article.aspx?articleid=95188