U.K. Champions League Deal Sets UEFA Up for $3.4 Billion TargetBy
BT’s $1.4 billion, 3-year contract to help UEFA sales rise 28%
Four deals down, UEFA expects social media companies to bid
The bidding war that led to BT Group Plc’s record 1.18 billion-pound ($1.44 billion) deal to retain U.K. rights to soccer’s Champions League has put organizer UEFA in sight of a 28 percent sales increase over three years through 2021, in line with its target.
BT agreed to pay 32 percent more than its existing contract to continue televising the elite tournament until 2021 following a second round of bidding. The British company was competing with satellite operator Sky Plc. and others to broadcast the 32-team event that features the cream of European soccer, including Real Madrid, Barcelona and Bayern Munich.
“There was enough interest to make it a competitive process,” Guy Laurent Epstein, UEFA’s head of marketing, said in a phone interview. Although the U.K. only accounts for a fraction of the event’s global audience, the country’s market is the most lucrative.
The deal is the fourth to be struck by UEFA for the 2018-2021 Champions League seasons following auctions in Japan, China and the U.S., where Time Warner Inc.’s Turner Sport beat rivals with a $60 million a year offer for English language rights. A tender for German rights is next on UEFA’s agenda, followed by sales in France, Italy and Spain in the second quarter of this year.
“We’re only at the beginning but very confident about the outcome," Epstein said. UEFA is targeting revenue of 3.2 billion euros ($3.4 billion) over the three-year cycle.
UEFA’s negotiations come at a time of change in the media landscape, with non-traditional competitors such as Amazon Inc., Facebook Inc. and a sports streaming platform backed by billionaire music mogul Len Blavatnik securing rights to sports competitions. With this in mind, London-based BT plans to broadcast the Champions League final on Youtube for the second straight year.
“We have had direct expressions of interest from social media platforms,” Epstein said. “We are at a tipping point now. Is this cycle too early to attract platforms or not?”
Despite its record outlay, BT’s victory hasn’t been met with universal approval by other companies associated with the tournament. Main sponsor Heineken NV has said it hoped some games would be shown on free television -- like before BT secured rights. Heineken’s head of sponsorship went as far as telling Bloomberg in January the event risked losing its “relevance” if it didn’t reach large audiences.
While viewer numbers are lower on pay television, the amount of content and conversation around the event on social media make up for lost eyeballs, according to Epstein. UEFA is working on a tool to capture that data to present to advertisers, he said.
“The question of audiences is not tackled in the right way today, we need to be more holistic and look at it from an exposure point of view,” Epstein added. “There’s lots of exposure that’s not measured.”