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In August it was announced that Facebook had purchased the exclusive rights to broadcast Spanish top-flight football, La Liga, for the next three seasons to subscribers in India, Afghanistan, Bangladesh, Bhutan, Nepal, the Maldives, Sri Lanka and Pakistan.

Facebook’s acquisition follows a growing trend of over the top content providers (‘OTT providers’) (i.e. content providers who stream media as a standalone product over the internet, rather than through a broadcast television platform) investing in live sports broadcasting. Here in the UK, with the English Premier League now well underway, this will be the last season (for the next three years at least) that UK fans will only be able to watch all games on Sky and BT Sport.  

Viewers are becoming less likely to watch linear television (i.e. programmes that air when scheduled). Only live sport remains resilient. However, with the increase in online platforms there has been a  dramatic shift in the way in which viewers consume sport.  We have seen a strategy emerge from the likes of Facebook and Amazon that is focused on the crossover between their wider technology platforms, sport and the large demographics in emerging markets that are interested in particular sports.

So, why has Facebook opted for La Liga?

Historically, individual clubs in La Liga would negotiate their own arrangements with broadcasters. The result was a disproportionate split in the broadcasting revenue between the big two, Real Madrid and Barcelona, and the rest of the division. This lead to a division that became predictable and the weekly fixtures beyond ‘El Clasico’ became far less attractive for neutral viewers.

To address the imbalance the Spanish Government in 2015 passed a Royal Decree which adopted a collective rights deal, whereby the rights to broadcasting were held by a single governing body - a model which is employed in the English Premier League. The result is a much fairer division of the revenue which arises from the licensing of La Liga broadcasting rights, which has enabled clubs such as Atletico Madrid to win La Liga in recent years and compete in Europe.

For OTT providers, La Liga may prove to be an excellent opportunity to acquire broadcasting rights for a sport series which is fast attracting an international audience for a smaller outlay than the fee for obtaining the same rights for the English Premier League.

Facebook’s tie-up with La Liga is a win – win situation for all parties involved. La Liga are eager to expand their international reach, as shown by the recent announcement that the league has entered into an agreement with Relevant, a sports media and entertainment group, to promote La Liga in the US and Canada (although this proposal is facing strong criticism from the Spanish Footballers’ Association). The increase in subscribers who join Facebook to take advantage of “free” La Liga fixtures will enable Facebook to capture those audiences overseas, and derive potential revenue from monetising subscriber data in the form of aggregated statistics, and an increased advertisement capacity to its new audience.

What has happened elsewhere?

Unlike Facebook, Amazon has challenged the traditional broadcasters in implementing its strategy.  Earlier this year it was announced that Amazon had acquired the rights to broadcast in the UK 60 English Premier League fixtures (20 fixtures per season for three seasons starting next season) exclusively to their Amazon Prime subscribers. This puts Amazon in direct competition with the two traditional broadcasting powerhouses, Sky and BT Sport, for the ‘crown jewel’ rights to broadcast Premier League fixtures to the main target market, the UK. However, whilst the Amazon approach may differ slightly from the route taken by Facebook, the obvious potential to increase the Amazon Prime subscriber base and therefore broaden the exposure to other offerings on the wider Amazon platform, shows that Amazon and Facebook have similar goals for their respective forays into football.

Eleven Sports has also challenged the traditional broadcasters, but has elected to bring an international product in the form of European football to the UK market, rather than target the rights to the English Premier League. It was announced in early 2018 that Eleven Sports had acquired the exclusive rights to broadcast both Serie A (top tier Italian football) and La Liga in the UK for the following three seasons (rights which were previously held by BT Sport and Sky respectively).

What do OTT providers need to think about?

Whichever approach is taken, obtaining exclusivity is vital for OTT providers to ensure that the price it pays for the acquisition of broadcasting rights is commercially viable. A loss of, or a third party intrusion into, that exclusivity could have significantly damaging effects - particularly if such loss or intrusion leads to a reduction in subscribers.

On the one hand, OTT providers will need to ensure that their right to exclusivity in their assigned territory is watertight in any licensing agreement. Ensuring that the territory is well defined, and that the license sufficiently covers all required rights, is vital. Rights holders may wish to retain certain rights to allow them to create their own content or to license those rights to a third party (for example, rights to create a highlights programme). OTT providers must be content that any such retained rights do not undercut the value of the acquired rights.

On the other hand, OTT providers will need to ensure that any licensing agreement clearly defines the restrictions on the rights holder in regards to any further licensing of those rights. Rights holders must be prevented from diluting the acquired rights by licensing these to other OTT providers or broadcasters. The licensing agreement should also contain an obligation on the OTT provider and rights holder to co-operate to ensure that any third party infringements, such as an OTT provider making content available to viewers in another OTT provider’s assigned territory, are swiftly addressed.

What next?

The market for broadcasting rights for sports to domestic audiences will become increasingly competitive and the cost of acquiring such rights will no doubt climb.  We will watch with interest to see if obtaining the rights to popular emerging sports series and broadcasting them to the international audiences, that the emerging sports series is eager to tap into, proves to be better value than competing for a domestic audience.  

From next season avid viewers of the English Premier League in the UK will require three subscriptions; Sky, BT Sport and Amazon. Those who wish to watch La Liga and Serie A will also need to subscribe to Eleven Sports. With the ever increasing diversification of broadcasters, and the increase in popularity in pay as you view content, the subscription based model could become unsustainable. In its place is likely to emerge a pay per view market with consumers paying just for the sporting events they want to watch, rather than subscribing to each broadcaster for numerous channels that they don’t.


Article written by Kate Jeffery, an associate in BCLP’s Sports & Entertainment practice, Graham Shear, head of BCLP’s Sports & Entertainment practice and Stephen Rigby, a trainee at BCLP. 

This document provides a general summary and is for information/educational purposes only. It is not intended to be comprehensive, nor does it constitute legal advice. Specific legal advice should always be sought before taking or refraining from taking any action.