The news came without much surprise: the call for tenders for the LFP’s domestic TV rights for the period 2024-2029 was unsuccessful. No broadcaster made an offer higher than the reserve price of 530 million euros for the premium pack including the broadcast of the two posters of the weekend, and the fourth, nor for the 270 million of the volume lot, or all of the other matches. The LFP will now have to negotiate over-the-counter with the broadcasters. Sports economist Luc Arrondel and Christophe Bouchet, former president of OM and author of Take control of French football money explain to 20 minutes the issues surrounding these upcoming negotiations.
Was it ultimately a desire of the LFP to negotiate over the counter?
For Christophe Bouchet, the outcome of the call for tenders was in no doubt: “It could only be unsuccessful, it is the first time that the reserve price has been displayed. And no one wanted to validate the 800 million,” he says. The more realistic estimate would be between 500 to 700 million euros. But for Luc Arrondel, “it’s easy to say afterwards that it was a foregone conclusion” while recognizing that “if there is no buyer, it’s because the stake was too high”. “From then on we can imagine that Vincent Labrune [le président de la LFP] wanted to show club presidents that the rights are not worth 800 million euros and say “you see, it’s not my fault”, says the former president of OM, for whom Vincent Labrune “does not does nothing by chance.
Is this a consequence of the non-participation of Canal+, the historic partner of the LFP?
Canal+ had warned the LFP in a letter: they would not participate in the LFP’s call for tenders for these 2024/2029 rights. “This thick disagreement between the LFP and Canal+ is one of the significant points of this failure since there is no longer anyone to fiercely fight your rights, which in fact reduces the extra premiums,” believes Christophe Bouchet. For several seasons, Canal+ has depended less and less on Ligue 1 with the acquisition of other rights, which also limits its financial capacity. But for Luc Arrondel, “Even if Canal+ comes back out the window, it would surprise me if they ended up with 800 million euros, the reserve price. »
Can the global panorama of TV rights in sport explain the L1’s difficulties in finding takers?
With the proliferation of platforms like Netflix, Amazon, Disney in recent years, “rights in general, which were very high, are experiencing erosion,” according to Christophe Bouchet. Add to that “a French championship of second rank compared to other European championships” and you obtain “a rather decreasing number of subscribers and a Ligue 1 which no longer interests”. From then on, “no one anymore puts a strategic bonus to win the prizes as Mediapro had done before”. But for Luc Arrondel, who knows the two firms which participated in drawing up the call for tenders, this price of 800 million did not come out of nowhere: “It worked during the last call for tenders with the billion reached between Mediapro [850 millions d’euros] and Canal+. The problem is that they didn’t take enough precautions with the guarantees. » And that the economic model evolves.
These TV rights seem all the more essential for French football after the agreement signed with CVC Capital Partnerswhich will take a significant portion of the amount collected each year…
The arrival of CVC Capital Partners in the capital of the LFP, following the difficulties encountered during the Covid period, will allow them to recover a percentage of the LFP’s revenues, including TV rights. “A reduction would be a double penalty. Because you will have lower rights. And at the same time, CVC will start to receive a percentage of revenues of around 13%. CVC will even take 20% in the first year, the 13% of the amounts to which they subscribed, with a tithe on the money invested upon arrival (1.5 billion euros). If you have 500 million euros of income linked to law, you will have to repay 100 million to CVC the first year,” warns Christophe Bouchet. Luc Arrondel recalls that the percentage affected by CVC “is not for life”, but it will last “as long as CVC is in the capital of the LFP”. But indeed “if domestic rights stagnate [ils sont actuellement de 650 millions environ]the clubs’ share of revenue will be reduced by the percentage taken by CVC from the 2024-2025 season,” he recalls.
What could be the consequences for French football?
If the LFP’s TV Rights do not increase, “the consequence is that the economic value will decrease, and therefore the sporting value since the two are closely linked”, argues Christophe Bouchet. The former president of OM does not see club bankruptcies, “even if it can happen here or there”, but rather “an obligation to resell the best players earlier and in greater numbers”. To compensate for this impoverishment of football through domestic TV rights, Luc Arrondel recalls “that we must also look at international TV rights, which are very low for France while they are increasing everywhere else”. The USA pays more to watch the Premier League than the MLS. Hence the LFP’s idea of relocating matches to the United States, “but it is far behind in this area”, warns the economist.