Spanish clubs secure revolutionary TV deal

The sale of television rights will bring clubs a record 1.5 billion euros a year – twice as much as they have received so far.

Spanish football clubs, including giants Real Madrid and FC Barcelona, are experiencing a small football revolution – this time not on the pitch, but in the economic field. The management of the top competition, La Liga (LFP), announced that over the next three years it will receive a record 2.65 billion euros from the sale of domestic television rights to Mediapro and Movistar. Together with the sale of broadcasting rights abroad, clubs will be able, according to AFP, to share up to 1.5 billion euros a year. “In the last five months we have almost doubled the value of La Liga, as last season clubs earned 830 million euros,” said LFP president Javier Tebas.

Monopoly of giants ends
The agreement is revolutionary not only because of the size of the contract but also because of the new system of distributing TV money. Until now, the biggest clubs sold the rights to their matches individually. The result was that almost half of the income went to Real Madrid and FC Barcelona (in the 2014/15 season, they received 42 percent of the total 760 million euros). This monopoly of the two giants should now come to an end. When asked whether the billions earned from the sale of television rights were his greatest achievement in office, the LFP chief replied clearly: “The biggest was obtaining permission for centralised sales of broadcasting rights, which was made possible thanks to the understanding of the Spanish government,” said Javier Tebas.

For comparison, in England, where Chelsea and Manchester City took the largest share of TV income, their combined portion was only 12 percent of the total. “Centralisation in England has brought a more even distribution of money, which benefits the whole league. There are more top clubs and matches, and each season a team no one expected can rise to the top,” sports analyst and football agent Jozef Tokos told the Economic Daily. The current example is Leicester City, the leader of the world’s richest competition, the English Premier League.

Mediapro pays the most
The largest portion of the 1.5-billion-euro package for Spanish football will be paid by the multimedia company Mediapro – specifically 633 million euros. It has the right to broadcast up to eight matches from each league round, Copa del Rey games, and highlights of all matches. The second company, Movistar, owned by Spanish telecom giant Telefónica, has the right to broadcast only one match, but pays 250 million euros annually for exclusivity. It chooses the rights, and therefore also holds the right to the most watched football match in Europe, the so-called El Clásico between Real Madrid and Barcelona.

“But these are only revenues from local football broadcasters. Then we have a second category – international rights,” explains Jozef Tokos. From these, clubs will receive at least an additional 330 million euros from Orange and Vodafone, whose acquisition was announced yesterday by the LFP management. (...)