Sports rights – should PSBs stay in the game?

It will come as no surprise to hear the Director General of the European Broadcasting Union, say yes, Public Service Broadcasters definitely should stay in the sports rights game.

In fact, the question we should be asking here is: will PSBs be able to stay in the game?

I, for one, hope so.

Let me give you the four main reasons why I think so:

First: Free-to-air sports broadcasting is in the interests of society Sport can have such a positive impact on society that it is, without question, in the public interest to show sports on free-toair channels.

It has a unique power to unite societies; to engage massive numbers of viewers personally and emotionally.

Football is a great leveller. Like all sports, it bridges social divides and creates healthy commonalities.

Sport is about fair play, hard work, respect.

Crucially, sport encourages youngsters to get active.

And in doing so, it teaches them values that are fundamental to successful societies.

Remember: if the young don’t get switched on to sport, there can be no next generation of sports stars.

Just think of important initiatives such as FIFA’s youth development programmes in the Third World, or the Right To Play Foundation, or the many great athletes that serve as ambassadors for organizations such as UNICEF.

But all these initiatives will have little or no impact if they are not conveyed to everyone.

Therefore, they need free broadcast access.

Second: Keeping sports free to air is in the interests of broadcasters

This is why free broadcasters are so important in the area of sports.

Our job – and obligation – is to reach out to everyone, to remind people that they are part of a greater whole.

Sport makes unbeatable entertainment.

Makers of documentaries, drama and reality TV can only dream of drawing the same level of focus.

Sport is microcosmic, unscripted human drama.

It has heroes and villains; it fires passions and stimulates debate.

But sport is so much more than entertainment.

When everyone shares a great sporting event, a cohesive sense of “nation” emerges.

Just look at what the London Olympic Games did for this country.

Team GB’s astonishing medal haul added to the magic, but its unifying power was detectable even at the Opening Ceremony.

Third: Sports and broadcasting are in symbiosis

But Public Service Media have a special obligation.

In the summer the EBU General Assembly agreed on a ‘Declaration on the core values of public service media.’

Universality and Diversity are among six of the values our Members identified as fundamental to public service broadcasting.

Not only do we want to reach out to the widest possible audience, since everyone is paying the licence fee, but we also strive to provide the greatest possible diversity of programmes, genres and opinions.

We want to offer the broadest range of sports – not to cover just football, football and more football. And by giving exposure to the greatest variety of sports, PSM provide invaluable support to national sports industries. We have a long history of doing this.

Today, the popularity of big events is still growing because of improving technology and quality of coverage.

Social media are engaging audiences even more by increasing the intensity of the whole experience.

Sports events are the ideal showcase for broadcasting innovation.

In 1967 the UK was introduced to colour TV the first time, on BBC Two.

Why? For Wimbledon.

In 1990, Europe enjoyed its first High Definition TV transmissions thanks to RAI and NHK.

Why? For the Italia ’90 FIFA World Cup.

And who can honestly claim they were not awestruck by the BBC’s game-changing coverage of this summer’s Olympic Games in London?

The BBC showed us new possibilities in terms of choice and raised the bar in terms of individualized viewing of the myriad sports they made available.

London 2012 was the first truly digital, multiplatform Games.

Digitization and the convergence of broadcasting, telecommunications and the internet have created new opportunities to watch sport on multiple platforms.

As well as mobile devices, these include subscription sport channels – channels that were unthinkable in an earlier era of analogue broadcasting.

But technical developments are also major drivers of sports rights revenues.

Which brings me to my next point.

Fourth: Keeping sports free-to-air is in the interest of sports and their governing bodies

Broadcasting and sport are symbiotic.

But the modern sports industry is built on business strategies that place enormous, fast profits above all else.

This short-termism is one reason why there is such a high turnover of managers and coaches – especially in football.

Worryingly, the development in football shows all the characteristics of a typical bubble.

I believe that in the long run this business model is unsustainable.

Media rights, sponsorship deals, gate revenues and merchandising are the major drivers of growth in the sports industry today.

It is not just about pay-TV networks spending vast resources to buy exclusive rights to properties that sports federations often bundle into multiplatform packages.

All of these developments have injected oceans of money into the most popular sports events.

And this has fuelled the absurd explosion of the salaries of many professional athletes – especially footballers.

Players’ wages are the single greatest expense in most sports today.

Spending on media rights continues to rise, despite an ailing economy.

Let me illustrate what is happening by listing some key numbers:

In the EMEA region the sports market is worth 43 billion US dollars (35% of total).

The underlying growth rate is now at 2.9%.

Media rights are up to 13.5 billion dollars.

Gate revenues: 18.3 billion.

Sponsorship: 15.1 billion.

Merchandising: 2.5 billion.

But some federations have to work much harder to maintain their current financial position.

And many broadcasters are in financial difficulties.

Most of them can’t refinance the cost of sports rights and production with commercial revenues.

So rights are simply treated as a marketing expense.

But if free-to-air broadcasters start to skimp on sports there will be less coverage, sponsorship revenues will fall and the production quality will suffer.

Where the big money is, dodgy betting, match fixing and other shadowy deeds are never far away.

Sponsors increasingly want clearer evidence of a return on their investment.

As a rule, the fans couldn’t care less about ballooning salaries of star players, provided they can afford a ticket to the match, their team wins and their club stays afloat.

As for the clubs, they are caught in a spiral of maintaining levels of investment, staying successful and winning on the pitch.

If they drop down the table their income dips sharply and the club will eventually go bust.

But in reality things might already be more serious.

According to Pricewaterhouse Coopers, just 20% of Europe’s leading football clubs manage to turn a profit.

Last but not least, there is mounting tension between sports bodies and regulators over keeping the playing field reasonably level in financial terms.

Regulators want to keep sports exciting and competitive, but rich clubs are spending their way to success.

In my view, this is an extremely precarious scenario.

It is comparable to the property bubble, the dot com bubble and what has happened to the music industry and its megastars.

Many of them have just priced themselves out of the market.

The music still exists, the stars still exist, but the industry has changed dramatically.

Admittedly, the sports industry protects copyright more robustly.

But, all in all, this is bad for the game.

This is just one of several reasons to protect the free-to-air broadcast principle in the interests of sports.

And here is another.

In many countries it is the taxpayer who underwrites the sports industry.

Moreover, in many countries it is public money that builds or largely supports the facilities where the sports take place. I believe in many cases the public deserves free access to the sports that is has paid for in the long-run.

I am not against free-market principles; nor am I a socialist.

But I believe there is a need for more regulation of media coverage to protect national interests and domestic sports.

Listing ensures that sports do not become an exclusive privilege, that they remain available to everyone.

A free-to-air requirement on sports that are on this slippery slope would put the brakes on and restore some common sense.

But listing cannot stop the sports bubble from growing.

Therefore, ladies and gentlemen, dear colleagues, the EBU will continue to do everything to secure the sport rights of its Members and free access to sport broadcast for their viewers.

• Because sport can make a valuable contribution to the further development of a society.
• Because sport is an integral part of the programming of a public broadcaster.
• Because free sports and free broadcasting belong together.
• Because public broadcasters are important to help overcome harmful developments in the commercialization of sports.

Thank you.