New Bundesliga Deal Eases Media Market Fears

New Bundesliga Deal Eases Media Market Fears
With the Bundesliga stealing a march on the other major European leagues and managing to get their restart plans underway quicker than everyone else, German’s top division subsequently garnered increased media attention. Attention, that for a few weeks was almost unrivalled and with competitions around the world lying dormant, the likes of Bayern Munich and Borussia Dortmund were being beamed to a much greater global audience.

Of course, these two and the other sixteen outfits within the division have had to play the rest of the season behind closed doors and with no fans in attendance, revenues have taken a collective hit across the league.

While although matchday revenues make a sizeable percentage of any club’s annual balance sheet, the revenue from television rights is arguably more important and the latest news to come out of Germany, will be of a relief both domestically and internationally.

As budgets in all footballing departments are feeling the pinch that a global pandemic has given them, there was a very genuine fear that media companies may soon follow the same level of financial restraint.

Which when you consider the Bundesliga’s current television deal is due to expire at the end of the season, it was the worst possible time for the Deustche Football League (DFL) to once again sit round the negotiating table with a slew of potential broadcasters.

The fear was simple and genuine and a fear steeped in one question? How much of a hit where the DFL prepared to take, in order to see their highly entertaining product continually viewed by the biggest possible audience.

At one stage, it did seem as if the DFL braced themselves for maximum impact and although they have had to suffer a small decrease in the overall value of their Bundesliga rights, those initial apocalyptic fears proved unfounded.

Thankfully, the new 4.3bn Euro TV deal will have allayed many concerns that both the DFL board and individual club chairman would have had and when you look at the size of the contracts that have been awarded, it suggests the attitude for live sport has far from dissipated.

Especially when you consider the need for content in this current climate and although traditional forms of televisual entertainment may have suffered in the past few months, football is now seemingly sailing out of the choppy waters it previously found itself in.

The fact that the new five-year deal has only shrunk from 4.64bn Euro, will also offer confidence to the higher ups in the rest of Europe’s ‘Big Five’, as they will soon have to go through their own period of post-COVID television negotiations.

The collective concern was that competitions might have to prepare for a slimming down as far as media contracts are concerned and although this has been a very genuine threat in Australia’s A-League, it seems that the world’s biggest stages might be afforded some level of financial immunity.

That said, it does seem as if the two parties involved in screening the Bundesliga are betting on the competition to steer them away from their own monetary issues and with both Sky Germany and DAZN requiring internal austerity measures, this does seem a rather bold roll of the dice.

DAZN may have a healthy footprint in other locations around the world, but it is yet to have truly caught light in Germany and their bosses will look to double down in the hope that the renewal of the rights they currently possess, will add a form of legitimacy to the brand itself.

However, they have been accused of overpaying for rights in the past and with their service being a subscription one plus consumers currently possessing less spending power, backing the Bundesliga for the second time is going to have to finally pay off for the streaming platform.

Still, now is the time for collective celebration within the German footballing community and although Bayern Munich have romped to an eighth straight title, the overall health of the competition is very strong – a strength that has allowed another bumper TV deal to now be inked.

 

Written by Dan Tracey

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