Premiere's Bundesliga hopes thwarted

Germany’s federal cartel office has approved soccer association Deutsche Fußball Liga’s (DFL) centralised marketing of the Bundesliga TV rights in conjunction with Leo Kirch. The long-awaited decision is, however, tied to a significant condition: DFL must ensure that highlights from Saturday’s matches are shown on free-to-air television before 20:00 CET.
The Bonn-based authority explained that the bundled marketing constitutes a cartel of the Bundesliga clubs which is only acceptable if consumers are entitled to share the associated benefits. By ensuring that an “attractive alternative” remains on free-to-air TV, the watchdogs want to avoid a situation where pay-TV operators which acquire the live transmission rights use their predominant market position to charge “inflated subscription prices”.

Public broadcaster ARD’s chances of continuing to report on Bundesliga matches early on Saturday evening on its popular Sportschau programme have thereby been significantly increased, although fellow public broadcaster ZDF or commercial broadcasters such as RTL or Sat.1 could also bid for the free-to-air rights.

The decision comes as a severe blow for pay-TV operator Premiere, which had been hoping to offer its subscribers more exclusivity by having free-to-air coverage pushed into a later timeslot. The Munich-based broadcaster was prepared to pay considerably more for the rights in exchange for this scenario.

The question now is whether Kirch’s strategy remains feasible. The media entrepreneur, whose agency Sirius will market the TV rights from the 2009/2010 season, has guaranteed the Bundesliga clubs a total income of €3 billion for the 2009-2015 period. Without significantly higher bids from the pay-TV sector, this goal will be difficult to attain.