Earlier this year the English Premier League (or the EPL as it is commonly known in Asia) sold the TV rights to its football matches for a record £5.1 billion ($7.8 billion). The three-year deal is worth 71% more than the last time the rights were put up for tender. Television money of this magnitude has made the EPL one of the world’s most competitive leagues. But there is a downside: it also helps to finance an influx of foreign players, depriving young English talent of much needed playing time.
It will be interesting to see how similar price inflation in Chinese football could play out.
In 2014 CCTV paid just Rmb10 million ($1.56 million) for the broadcasting rights for the Chinese Super League (CSL). The fee was only “symbolic”, Nanfang Daily suggests, because the state broadcaster’s sports channel, CCTV-5, had a virtual monopoly over airing most major sporting events (see WiC188).
Then competition from internet media firms began to grow. As a result of the new interest, CCTV-5 was compelled to raise its payment to Rmb50 million this year. However, Chinese football fans were shocked last week by the news that the television rights for the CSL over the next five years had just been sold for Rmb8 billion. The deal translates into a per-season price of Rmb1.6 billion, which is 160 times greater than the sum paid in 2014.
CCTV-5, a free-to-air channel, has shown CSL matches since 2004. But now the state giant has lost out to Ti’ao Power, a media firm which a year ago was a unit of China Digital Culture, a Taiwanese-owned and Hong Kong-listed company with a market value of less than $50 million.
A victory then for a David over a Goliath? It’s not that simple. In December last year Ti’ao Power was acquired by China Media Capital (CMC) for an undisclosed amount. Run by Li Ruigang – dubbed by local media as “China’s Rupert Murdoch” (see WiC218) – CMC has been on a government-encouraged spending spree. For instance, it recently set up a studio with Warner Brothers to produce Chinese movies in Hong Kong. It has also just agreed to bring Legoland to Shanghai. (Reportedly it is also in the market to acquire the Formula One franchise for $8.5 billion.)
Now football fans hope CMC will help to revolutionise Chinese football – something that would definitely meet with the approval of Xi Jingping, the country’s soccer-loving leader.
“It’s a historical day. It boosts our confidence to build CSL into one of the top leagues in the world,” Zhang Jian, vice-chairman of the Chinese Football Association, told reporters after signing the TV deal.
How Ti’ao Power is going to recoup the rights fee is yet to be determined, although football fans will surely be asked to pay to watch matches, much of it through online streaming.
That means an end to the era of free football coverage from CCTV, although some of the increase in revenue will be put into improving club facilities and especially their youth training programmes.
Last month CMC and Ti’ao Power said they have also invested an undisclosed amount in EuMedia, the organiser of the China University Football League.
According to Tencent Sport, the end of CCTV-5’s CSL broadcasting monopoly is part of the reform plans announced in February to turn China into a great footballing power. About 6,000 football schools will be set up this year in campuses nationwide as part of the planning blueprint penned last October by the State Council to boost the sports industry’s gross ‘output’ to Rmb5 trillion by 2025 (i.e. 16 times its value in 2012).
Tencent Sport says the new TV deal underpins a new market-driven approach and “will be the catalyst for the revaluation of the Chinese football industry as a whole.”
Indeed, Chinese tycoons have been rushing to invest in football clubs at home and abroad, including Alibaba, which paid Rmb1.2 billion last year for a 50% stake in Guangzhou Evergrande, a football club also owned by the property developer of the same name.
Aided by Alibaba’s financial firepower, Evergrande sealed its fifth consecutive CSL title this week and the Guangzhou club will take on the UAE club Al-Ahli later this month in the final of the Asian Champions League (the equivalent of the European Champions League). Evergrande will be looking to regain the title of Asian champion which it first won in 2013 (see WiC216).
Evergrande’s international success hasn’t been replicated by the national team, which is on the brink of elimination from the World Cup, having struggled in a qualifying group that also contains Qatar and Hong Kong.
Having been beaten by Qatar in the last away game, a win is now essential in China’s away match against Hong Kong on November 17. Bizarrely the match will be played in a tiny ground with a capacity for just 4,000 fans. Hong Kong’s main stadium – which holds 40,000 people – would seem to have been the more natural choice, given the demand for tickets has been huge. But a government body pronounced the pitch unusable following a rugby sevens Olympic qualifying round next week.
Not everyone thinks that is the real reason, of course. A columnist with the South China Morning Post voiced an alternative explanation: that local officials have opted for the smaller stadium on fear that 40,000 Hongkongers will not only boo the Chinese national anthem once again (see WiC299) but also exploit the event to channel anti-Chinese sentiment from the stands in an attempt to embarrass Beijing.
Truth be told, Hong Kong’s reputation for intimidating behaviour at matches is being more than a little overplayed. But last month the territory’s football bosses announced a clampdown on fans bringing paper juice cartons into the stadium for the match, following an incident at an earlier game when a spectator threw a carton of lemon tea onto the field.
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