Premier League fears rising as multi-billion pound house of cards begins to fall
The multi-billion pound industry is beginning to fall like a pack of cards.
Television deals are what makes the football world go round and is what is driving the Premier League to get this season finished at all costs.
And if anyone needed proof of just what a precarious position the beautiful game is in, then the warning signs came loud and clear from France.
French broadcaster Canal Plus has told France’s top two divisions it will not pay £100million due as the next instalment for TV rights as no games are being played amid the coronavirus pandemic.
It cited force majeure, which allows a contract to be terminated because of extraordinary circumstance.
Canal Plus chief executive Maxime Saada has written a letter insisting: “Our pay-TV activities are strongly impacted by the closure of large part of our sales channels and by the weakening of the attractiveness of our sports offers.
“Our advertising revenues are in free fall [and] our international television and Studiocanal activities are also severely affected.”
Interestingly, Canal Plus has the Premier League rights and the fear at the English end is, that while Sky and BT Sports are believed to be ready to be flexible, the foreign rights holders are unlikely to be so understanding.
Foreign deals made up £4.35billion in the last round of negotiations which is just behind the £5billion domestic rights for the richest league in the world.
But with no football to show, the whole business is in serious danger of collapsing – and that explains entirely why the Premier League is so determined to get this season done.
Premier League clubs will have to pay back £750m in TV rights if they are unable to finish this season – and they are under pressure to start games again in June. They know they cannot afford to lose TV cash.
In the last five years, TV deals have far eclipsed gate receipts as the biggest financial breadwinner in the Premier League and the EFL clubs at all levels could not survive without their broadcast deals.
The players have lived off the wealth of the deals with Mesut Ozil earning £350,000-a-week, Manchester United gave Alexis Sanchez a contract worth £500,000-a-week while Paul Pogba, David de Gea, Raheem Sterling and Kevin De Bruyne are all among Europe’s top earners.
Now the pressure is on the players to take pay cuts in the Premier League, not just deferring their huge salaries for two or three months but to follow other clubs in Europe and take a chunk out of their salaries to keep football going.
It has been done in Germany with Bayern Munich and Borussia Dortmund among those reducing their player salaries. Barcelona has asked its players to take cuts.
Birmingham and Leeds have agreed deferral packages, Brentford became the first club to agree cuts, taking each player down to a maximum of £5,000-a-week.
Now the heat is on the top earners to do the same in the Premier League to save the game from top to bottom with the Professional Footballers’ Association asking the top flight to also come to the financial aid of the EFL amid the biggest crisis to hit the beautiful game.
There is a perception of wealth in the top flight, probably not helped by Tottenham chairman Daniel Levy’s earnings of £7m last year, becoming public amid the financial crisis.
And amid the crazy sums available at Manchester United, Chelsea, Manchester City, and the rest, it is to see why.
But other clubs in the top flight live week-to-week and they are not so cash rich – although do not expect them to get much sympathy.
However, it is the TV money which keeps everyone afloat and, with the growing fear that is in jeopardy, this is what is pushing clubs towards drastic action.
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