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Sky Deutschland has secured a new agreement ensuring that it will remain “the undisputed home of Bundesliga football” through to 2021.
Following a successful outcome to the German Professional Football Association’s (DFL) tender process, Sky will air 572 live matches a season from 2017/18 to 2020/21 across all platforms. The new deal means Sky will continue to broadcast 93% of all live matches, including full live coverage of Bundesliga matches on Saturday and Sunday afternoons.
For the first time, Sky will also become the exclusive live broadcaster for all matches of the Bundesliga 2 regular season, with an additional live match on Monday evenings.
Under the new agreement with the DFL, Sky will pay 32 per cent more in the 2017/18 season – the first year of the new contract – than in the final year of the existing agreement which concludes at the end of the 2016/17 season. Over the four years of the new agreement, the average rights cost per annum will be €876 million, compared to an average of €486 million per annum under the existing contract.
Sky Deutschland says it has added 1.2 million customers over the last three years, grown its revenues by a total of almost 40 per cent and moved the business into profit for the first time in a third quarter (to end of March 2016).
Jeremy Darroch, Group Chief Executive, Sky, said:
“We are delighted to win the Bundesliga contract. This means Sky Deutschland is the undisputed home of football through to 2021 in one of Europe’s most passionate sports markets. This is an important step to building our business in Germany and maximising the significant opportunity for growth. Our continued leadership in sport will underpin the execution of our wider strategy for building out pay-TV: providing a broad range of the very best content, market-leading innovation and best in class service from a trusted brand. We are pleased with the progress we are making and we are well placed to bring Sky to even more customers in Germany and create value for our shareholders.”
According to Tim Westcott, Senior Principal Analyst, TV Programming at IHS Technology, the 80 per cent increase in Sky’s payment for rights underlines the importance of live league football to pay-TV market leadership, and he suggests that there are obvious parallels with the latest Premier League deal in the UK.
“The increase in value of the Bundesliga’s TV rights shows how far the league has come in developing its revenue base. The Bundesliga will leapfrog Spain’s Primera Liga and Italy’s Serie A to become the second most valuable European league. Even so, the Bundesliga (worth €1.16 billion a year) is still far short of the Premier League (€2.5bn),” he notes.
“Eurosport’s entry in the market for domestic Bundesliga rights is another sign that its parent Discovery is serious about investing in strengthening its rights portfolio,” he observes.
“On an annual basis, the value of Bundesliga rights increased by 87 per cent, less than the 180 per cent for the latest deal for the Super Lig in Turkey and 108 per cent for the rights to the Liga Sagres in Portugal. Sky’s aggressive bid to retain its leadership of Bundesliga rights is similar to the 85 per cent increase in its payment for the new Premier League contract in the UK and Ireland,” he suggests.
“Eurosport’s entry in the auction means the DFL did not invoke its ‘no single buyer’ rule which would have made one of the live rights packages available for over-the-top exploitation. The new deal means will bring Germany into line with most other countries in that no single operator will hold exclusive rights to national league football,” he advises.