DFL considers legal action

German soccer association Deutsche Fußball Liga (DFL) is considering legal action against the federal cartel office’s decision regarding the allocation of the Bundesliga TV rights.
There are now also rumours that News Corp or a News Corp-backed entity could jump in and snap up all available rights.

“We have commissioned numerous legal reviews,” said the soccer league’s president Reinhard Rauball in Frankfurt am Main. The Bonn-based authority recently approved the centralised marketing of the rights through DFL and media entrepreneur Leo Kirch only under the condition that the highlights of Saturday matches would be screened before 8pm on free-to-air television.

According to DFL’s managing director Christian Seifert, the contract with Kirch - which guarantees a total income of €3 billion for the seasons 2009 until 2015 - is still valid, although a plan C will now have to be developed as the cartel office’s decision would lift the contract’s foundation.

According to the competition watchdogs, the centralised marketing constituted an inadmissible cartel of the Bundesliga clubs which, as an exception, could only be permitted if some of the advantages were passed on to consumers. This would be the case if coverage of Saturday’s matches was screened before 8pm by public or commercial broadcasters. Later broadcasts would deny large sections of the public an opportunity to keep abreast of developments. With this regulation, says the cartel office, viewers would be given an attractive alternative to the live games screened on pay-TV while at the same time pay-TV broadcasters would be prevented from charging inflated subscription prices.

According to German news magazine Focus, DFL is considering various new marketing concepts, including the idea to offer cable and satellite operators such as Kabel Deutschland, Unitymedia or SES Astra soccer packages with free-to-air highlights of the Saturday matches to attract new customers. The report also claims that media mogul Rupert Murdoch is considering an offer of €450 million per season for the complete rights package comprising free-to-air and pay-TV coverage. This would be less than the €500 million per season guaranteed in the original DFL/Kirch contract, but €30 million more per season than the league’s current income from TV contracts.

The rights would be an ideal lure to encourage Murdoch, who is already the largest single shareholder in pay-TV operator Premiere, to buy into a German free-to-air TV channel such as Sat.1, which could then screen the highlights on Saturday before 8pm. The media entrepreneur could thereby establish a strong foothold in both Germany’s free-TV and pay-TV markets.