The Premier League is poised to announce a new £4.5bn TV rights deal with its existing partners Sky, BT and Amazon, avoiding an auction that could have led to hundreds of millions being wiped off the value of the next deal.
The league has been in talks for months with its existing UK broadcast partners and the government, which has the power to block direct deals on competition grounds, as the cooling market for sports rights left it facing a £500m-plus drop in the value of the next deal if it went to auction.
It is understood that the Premier League has already agreed a deal in principle with its broadcast partners, with the parties waiting on the government to make a formal announcement. According to sources an announcement on the new TV deal, which spans the 2022 to 2025 seasons, could come as soon as Thursday.
Ministers have agreed in principle to the deal to help protect clubs’ finances from further strain. Lost ticket sales and rebates to broadcasters over cancelled matches are estimated to have cost clubs up to £2bn, but the government wanted guarantees that the Premier League will funnel more money to harder-hit teams in lower divisions.
On Wednesday the 20 Premier League clubs agreed an additional £100m for lower league teams, on top of around £140m in payments each season, according to the Financial Times.
The Premier League’s move away from an open auction comes as the League has seen a drop in the value of its rights. Analysts had forecast that in the next auction the total value could fall by anything from £500m to as much as £900m, following a decade of hyper-inflation as Sky and BT battled for football supremacy.
At the last auction in 2018 overall takings came in about £600m lower than the previous record of £5.1bn, the first decrease since the 2004-05 three-year cycle of rights.
Comcast, which took over Sky in a £30bn deal three years ago, has accelerated the TV company’s move away from bidding big on sports rights.
Philip Jansen, who succeeded Gavin Patterson as BT chief executive in 2018, has also made it clear the telecoms company wants to focus on its £12bn rollout of full fibre broadband and on a new 5G mobile network over controlling expensive sports rights.
Last month the company confirmed it is seeking a strategic partner for the pay-TV business BT Sport, which has lost an estimated £2bn and is barely profitable, to defray the cost of sports rights deals and focus on its core business.
Three years ago Sky and BT ended a nearly decade-long dispute to strike a channel-sharing deal so customers could watch all Premier League games without being forced to buy separate TV packages. This reduced the need to bid big or miss out on the best games, and BT declared it was happy to operate as a “viable second” competitor to Sky in sports broadcasting.
The Premier League has attempted to attract new, deep-pocketed Silicon Valley bidders; at the last auction it offered rights to packages of games designed to appeal to a streaming company. But the initiative failed with Amazon finally stepping in to pay only £90m over three years to stream 20 live games a season.
Last month, the sports streamer Dazn, owned by the billionaire Sir Leonard Blavatnik, agreed a €2.5bn deal for Italy’s Serie A rights from 2021 to 2024, ousting Sky Italia as the main broadcaster.
The German Bundesliga saw the total value of its TV sports rights drop by about 5% in deals struck last summer for the four years from 2021. The Premier League and its broadcast partners declined to comment.
