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Will ‘Premflix’ be too OTT?

Will ‘Premflix’ be too OTT?

PREMIER LEAGUE: The way we consume football could be about to change as the English Premier League has confirmed it is actively working on plans to launch its own digital streaming channel.

By Ben Tirebuck

Friday 14 February 2020, 02:00PM

The league’s new CEO, Richard Masters, has stated that a platform similar in style to Netflix would allow the sale of live games directly to fans, bypassing traditional broadcasters. The concept has already been dubbed “Premflix” by some.

It is believed that a new “Over The Top” (OTT) service could begin test trials in overseas markets as early as 2022. Masters confirmed the option of the league running its own service rather than selling rights via traditional broadcasting outlets which would, if successful, completely revolutionise the way the game is consumed on a global basis.

“During the last [rights bidding] process [for the 2019-22 seasons] we spent quite a lot of time and invested a lot of resources in building our expertise and capacity in ‘direct-to-consumer’,” said Masters.

“We considered whether strategically it would be the right time to test a few markets then and decided not to,” he added.

“We were ready last time and we will be ready next time should the opportunity arise. Eventually, the Premier League will move to a mix of direct-to-consumer and [traditional] media rights sales.”

Masters added: “Sports competitions like the Premier League have been successful in seeking partnerships with established broadcasters and having to secure funding as its model.

“Secured licensed revenue and direct-to-consumer revenue are entirely different strategies - the transition from one to the other, if and when it ever happens, would be a big moment.”

Rumours of a potential Premier League OTT service have been doing the rounds for some time although it has not yet deterred global broadcasters from buying the rights to distribute games.

The value of overseas league rights for the 2019-2022 period rose to £4.35 billion (B175bn) Last week, a six-year deal for rights in the Nordic region alone was announced at £2 billion (B81bn).

Remove the price parameters’

The concept is something former Crystal Palace chairman Simon Jordan has previously touted, telling the UK’s talkSPORT that the Premier League launching its own product worldwide online would provide fans with a cheaper and more effective service

“I think they’ve got to become their own broadcaster, set up their own platform and become a VOD - video on demand - broadcaster,” he said back in December.

“Then they would be able to remove the price parameters people are resisting now with the traditional broadcasters.

“People are churning off Sky and they’re churning off BT because they don’t want to pay £75 (B3000) or £80 (B3225) a month, they don’t think it’s justified.

“If you brought in a Netflix of football, got 100 million subscribers around the world paying £9 (B360) a month, you’d have no churn because no one would be able to resist that price point.

“You’d bring in £11 billion (B443bn) every year rather than £8.1 billion (B326bn) every three years, and you’d build a model that would have enormous revenues, sustainability capital grown and an unbelievable reach.”

The Guardian highlighted that the Premier League could potentially make another £100 million (B4bn) per season in Singapore alone with a direct service, compared to its existing per season rights deal with Singtel of £70 million (B2.8bn).

However, digital sports consultancy service Seven League predicts that first there would need to be a number of trials, including telco and ad-funded partnerships.

“If all current broadcast deals stopped on the expiry of their current cycle and were replaced exclusively by OTT, you could potentially talk about 100 million subscribers within two to three years, assuming the league got its pricing and technical infrastructure decisions right,” commented Seven League consulting partner Daniel Ayers.

“Clearly that won’t happen to TV broadcast deals, and it’s most likely that OTT will be launched in test markets more gradually, with a number of different models trialled” Ayers added.

The closest the Premier League home market has seen to such a trial was delivered by Amazon Prime Sport who secured a rights package permitting them to televise 20 live matches last December.

Should the “Premflix” model be employed, the biggest challenge for the Premier League would be transitioning from the facilitator of 380 games per season into a global broadcasting giant servicing millions of customers across hugely diverse continents, languages and cultures.

Then there are the teams themselves.

The loss of broadcasting revenue has the potential to splinter the league. The likes of Liverpool, Manchester United, Chelsea et al have an audience far and wide and would reap rewards from the “PremFlix” model; less so the likes of Burnley, Bournemouth and Brighton who are currently well fed financially under the broadcast model. The more established order could even decide to breakaway and stream their own games directly to fans, therefore pocketing all the income.

Likewise, it would be interesting to see the effects on actual spectator participation and matchday crowd figures. It is a lot easier to stay home and watch the game from the comfort of home on a cold, wet February evening than venture to the ground and this could have profound consequences for the game, much like entertainment streaming platforms such as Netflix have had on cinema.

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