Real Madrid, Barcelona Will Have TV Revenue Limited by Law

Real Madrid and Barcelona’s television revenue, which helps make them the world’s richest soccer clubs, will be limited under a new Spanish law.

The teams, with combined annual sales of 1 billion euros ($1.36 billion), won’t be able to receive more than four times as much broadcast income as the smallest of the 20 clubs in Spain’s La Liga under the legislation, league president Javier Tebas said in an e-mail today.

Real and Barcelona currently earn about 6.5 times as much as the smallest team, Tebas said.

The government is seeking to address the imbalance after Real or Barcelona won the last nine Spanish league titles and had an advantage of 30 points over third place in 2012. Atletico Madrid is level on points with them atop the standings after 23 of 38 games this season.

The league has held talks with the government about amendments to the so-called Sports Law that are scheduled to be approved this year and take effect in 2015, according to a government official. He couldn’t immediately confirm details of the changes.

Real and Barcelona’s broadcast income will remain the same for “a few years” under the new law as other clubs catch up, Atletico Madrid Chief Executive Officer Miguel Angel Gil said in a phone interview.

‘Won’t Be Happy’

“Real Madrid and Barcelona won’t be happy” if their television income is frozen, Catherine Davies, who covers Spanish soccer rights for London-based consultancy Sportcal, said by telephone. The league is working to placate them by increasing total broadcast sales, she added.

Amid falling pay-per-view subscriptions because of Spain’s economic slump, the league aims to boost TV rights income to 1 billion euros from 752 million by 2017 by combating piracy, increasing sales abroad and pushing the government to remove a weekly match on free-to-air television, Davies said.

Real Madrid and Barcelona officials didn’t immediately reply to requests for comment.

Italy introduced similar legislation for the Serie A championship recently that’s pared back the financial advantage of Juventus among other clubs, Atletico’s Gil said.

The English Premier League has had a more equal distribution of TV money since its foundation in 1992. Champion Manchester United, which had the biggest share last season, received barely 1.5 times what lowest-earning Queens Park Rangers got, according to league data.

‘Revenue Advantage’

Real and Barcelona had revenue of 519 million euros and 483 million euros respectively for the year through last June, making them soccer’s richest clubs by sales, according to a Jan. 23 report by Deloitte LLP.

The size of their TV contracts with Mediapro, which expire next year, gives them a “significant revenue advantage” over other European clubs including Bayern Munich and Manchester United, Deloitte said in the report.

Real and Barcelona each had broadcast income of 188 million euros in 2012-13, while Bayern and United earned 107 million and 119 million euros from television rights, respectively, according to Deloitte.

To contact the reporter on this story: Alex Duff in Madrid at aduff4@bloomberg.net

To contact the editor responsible for this story: Christopher Elser at celser@bloomberg.net

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