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TV Rights And English Football’s Imminent Dominance

£5.136 billion in domestic TV rights deals could see the Premier League retain its place as Europe’s top league

20May

When Hull City and Sheffield Wednesday step out onto the field at Wembley on May 28th, they will compete in by far the most valuable fixture in the soccer calendar. It seems almost ridiculous that something as chaotic and unpredictable as a game of soccer can have such drastic financial implications, but at the end of the month one of 36 players will score a winning goal that takes their club into the Premier League and into the financial elite. In fact, there is no more valuable single action in team sports than the winning kick at Wembley. The prize for that kick? £170 million, at least.

In fact, Deloitte claims that achieving promotion this season could be worth as much as £290 million, should the promoted club avoid immediate relegation. No one is suggesting clubs will be following Leicester City’s trajectory with any regularity, but simply having a seat at the table is enough to see significant financial return. A club can lose all of their 38 Premier League games following promotion and still qualify for the millions of pounds in parachute payments awarded to teams that are relegated - Aston Villa, for example, are set to receive £87 million over the next three years.

The Premier League is England’s most expensive export, with an incredible £5.136 billion in domestic TV rights deals secured between Sky Sports and BT Sports for the period of 2016-19. The former, who will show 126 games to BT’s 42, are putting up £1.392 billion per season - that works out to £11.07 million per match. The deal constitutes an incredible 71% increase on the deal that ran from 2013-16, and Sky Sports themselves admitted that they paid about £330 million more than forecasted, according to BBC Sport.

Such is the increase that Premier League clubs will see unprecedented financial power in the years to come. The £60.9 million in TV revenue previously awarded annually to Premier League clubs will rise to something in the region of £96 million - recent research suggests that this will take each of the 20 clubs in England’s top flight into the list of the 30 richest clubs in the world, and investors will be the first to note the potential this affords even the smallest of those clubs. Indeed, shares in Manchester United jumped 5% at the announcement of the deal - according to the BBC - and the rest of Europe stands to be overshadowed by the UK’s growing behemoth of a competition. Crystal Palace co-owner, Steve Parish, described the situation as ‘insane’ when it was revealed that the London club could see more TV revenue than Barcelona and be able to pay higher wages than La Liga giants and Champions League finalists Atletico Madrid.

With overseas TV deals, the figure for each club could top £100 million, and the effect of the windfall could be felt as early as this upcoming transfer window. The clubs will receive the £8 billion windfall a month early, in July, having lobbied the Premier League to release the funds early. The move will help newly promoted clubs, who will be able to begin flexing their new financial muscle earlier than expected, giving them greater scope to compete at the top level come August.

And the deal has clubs across Europe worried about English football’s imminent dominance. Barcelona’s club president Josep Maria Bartomeu revealed in February that the club consider the Premier League a more considerable threat to the Catalan club’s future than Real Madrid. ‘[They] will have an incredible financial situation from now on and we are worried,’ he told BBC Sport. ‘The Premier League is the best football competition. It has the most interest for fans and most revenues. They are doing things good and keeping teams in the competition where everyone being equal is of interest for everybody. We have different budgets in Spain and it would be difficult for someone like Leicester to be top of the league. Our rivals are the Premier League, they are the big adversaries. We have to do our best to increase our revenues and our financial situation to make the talent of our teams stay with us.’ The disproportionately weighted finance distribution system in La Liga means that the likes of Real Madrid and Barcelona will still hold considerable financial might, but the era of La Liga hoovering up the world’s talent may be coming to an end.

The influx of TV money is an exciting prospect whether you support Chelsea or Middlesbrough. The gap between the Premier League and the Football League in terms of quality will only increase in the years to come, but the prize of promotion to the top flight is now more of a holy grail than ever before. The Barcelona president may be dreading the imminent power shift, but as a fan of a certain London club that have had dealings with the Catalans in the past I, for one, welcome the coming shift.

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