Why SPL TV Is A No Go

So Raith Rovers have come out and explained in a statement their concerns about Newco Rangers. The statement in the whole is well balanced and makes sense.

Its let down by one paragraph relating to the TV contracts.

They said…

It showed the impact of potential total loss of 3 TV contracts, all of which had been inexplicably agreed on the basis that the broadcaster could walk away if either Rangers or Celtic were not in the SPL. His information did not, however, set out the potentially positive impact of negotiating replacement contracts with other broadcasters or alternatively the much mentioned possibility of launching SPL TV (which we understand could have been launched within a matter of months).

Now first off the ‘potentially positive impact of negotiating replacement contracts with other broadcasters’ comment.

Ok are Raith Rovers suggesting that the SPL can get a better deal elsewhere?

The fact is, the only company in town are SKY who are offering £10m a season with four Old Firm games. ESPN have a secondary deal worth around £5m a season.

Now who is going to offer more?

BBC and STV didn’t even bid for the secondary deal, so they are basically saying they cant afford the £5m never mind £10m or above! That or they just are not interested in the product!

BT Vision are not in the market yet and have splashed out a fortune to get the secondary EPL live games in a years time. So they will bring out their own channel, that will take a year to come onto the market. They don’t need or want the SPL especially not in the short term.

People have suggested that in Denmark the Danes have a better TV deal for their football league, which isn’t as good or big in terms of brand as the SPL is. The figure banded about is €45m, well the Danish broadcasters only have one major league to look at. SKY and the rest have  a UK market and look at the EPL first as its a major cash cow.

There is no competition for the SPL rights, for various reasons I may add, this means that SKY can come in and snap them up at the bottom price. Take out the Rangers fans and the Old Firm games and you takeaway  a lot of their viewership and the highest rated games.

Now for SPL TV.

Months? Really Raith Rovers months?

Can you back this statement up?

Now for the past two years I have visited the IBC show in Amsterdam. IBC is Europe’s premier International Broadcasting Convention. This is a show where all the top companies sell their goods to broadcasters such as BBC, SKY and ESPN.

I work in production and know what will be needed to start up an SPL TV channel and the prices for most of the goods they will need.

Now let me take it to the basics.

The SPL could, probably would hire most goods. They would probably go down the same road as Setanta who hired a lot from local broadcasters. Thats full time expense without guaranteed income. By the way what happened with Setanta?

Now is this channel going to be on subscription TV or online?

By going online only, they shall alienate a number of fans that either don’t use the internet or that hate live streaming.

Going on TV they then have another out going expense and would need to sort out a deal with say SKY, BT, Virgin, Freeview or all of them and get a channel in months?

Not sure that timescale works, especially with SKY the main provider.

Instead of handing over all their cash without return, maybe they could buy some of their own equipment.

Now surely in this day and age they will want HD and broadcast quality equipment.

So for a cheap broadcast spec HD camera it will cost you £20k. That is bottom of the range. Now you can’t have one camera! You will need at least three to cover the live action games (Very minimum). There is a chance at least once a season you do two live games at the same time. So thats six cameras there. Then you will need at least one camera for the other 3 or 4 games so you will need another 3 cameras. So in total you will need at least 8 cameras a week.

Just so you know that is the smallest scale possible. SKY will use around 10 in a live SPL game. When I was over in Holland for a TV game and they had 30 cameras for a game they were also covering in 3D!

That’s at least £160k in camera equipment less the lenses that could cost up to £60k. Add the two you would need in case of two live games at same time and thats you up another £40k. Oh you’d also need at least one studio camera, thats at least another £30k although I would go for a better camera for that situation, so again even more money.

One camera game highlights, should we to expect the same as what RaithTV provide?

For the live game cameras you will need at least one Steadicam. The ones that SKY use come in at around £6k. Now again you may have two live games on same day, so will need two. Generally TV stations use more than one in live game.

For all these cameras you will need camera operators. That is at least 9 per week and on a big week 11. A good freelance camera person usually charges £400 per day. So 9 camera people x £400 = £3600 per week, for at least 38 weeks which would be £136,800. Thats going on one live game a week for a season.

Add a presenter, at least one commentator, three to four pundits, a gaffer for lighting, 3 people for sound, some riggers, at least one editor, director, producer and  some runners/researchers. Thats about enough to cover a live game to a professional standard (again minimum).

Then there is the cushy job of full time Chief Executive for this channel, his or her PA, a possible media/PR person or department, an admin department that will deal with sales and complaints (say at least 4 people minimum.) Also at least one person to deal with processing the orders, though they could hire that out but thats another expense. These people will be on full time/permanent contracts.

So staff wages could put the costs through the roof.

Also are the SPL, who are not media savvy, able to bring in all these new employees within a month or two?

You will need your own state of the art editing studio. Plus editors who can use that equipment to a high level and under high pressured situations. Professional editing software costs £3k for the top of the range. A custom editing desk would cost between £6k to £10k.

Good luck hiring a studio for less than £1000 a day and thats with no equipment. They could use Hampden but the SFA will still want some cash for that.

For your live game you will need a satellite truck to edit footage and stream it live to the TV sets. If you have two games at the same time then you need two trucks or say you have two live games a weekend, one game is 5pm Kilmarnock and then the next is noon on the Sunday at Dingwall. That again means two trucks. These boys cost big money. At second hand it costs at least £80k and I will doubt those are HD compatible. New ones at a good standard will be £200k plus.

Now you will also need at least 9-11 tripods, Rainproof covers,20-22 camera batteries, 20-22 memory cards, industrial/professional cable, 4-4 radio mics, probably four headsets/mics for commentators, an auto-cue, TV’s, lighting and monitors.

Then there is a fleet of vans to ferry the equipment to the grounds. Plus company cars and phones.

So to do it properly, the equipment alone would cost hundreds of thousands of pounds. Again this is given a timescale of ‘months’ by Raith Rovers.

Then you have to insure it all, back to the bank as your balance goes down further.

Now we have the equipment and staff. We have a channel. Lets make some cash.

We can offer advertising on our channel. Butt we need to have subscribers for the advertisers to get excited about. We at least have the Old Firm , a huge match with a worldwide audience…. Oh wait!

So you get subscribers. Lets set a price…

For ESPN in the UK you pay either £10 a month if you already have Sky Sports or you have to pay £13 if you don’t. ESPN UK next season offer EPL games, FA Cup games, international football, Serie A, Bundesliga, Ligue 1, the Eredivisie, UEFA Europa League  and the MLS plus NBA, NFL, MLB, UFC, rugby and filler programmes such as Press Pass and 30/30 documentaries.

So say you have Sky and the sports package thats £39 per month add ESPN and you go up to £49, how much could you sell SPL TV for?

You have a niche market, one that without both sides of the Old Firm shrinks, that is a fact. Rangers have a fan base of 50k plus in the UK. I am unsure the majority of them will buy SPL TV for the fact they are not in it, the quality on offer isn’t great and the fact some just wont give the SPL any of their money.

So your niche is now smaller. You can’t offer the same amount of product as ESPN or the same quality as ESPN, so can you charge more than £13?

I have heard people say SPL TV could cost between £15-£25 a month?

For one flawed product, that can’t guarantee quality on the park or production value off it?

MUTV and Chelsea TV offer channels for £6 a month. They give out game highlights, interviews and documentaries. They are also niches but probably have bigger worldwide audiences. I think that SPL TV can charge more than these two as fans will want to see some live Scottish football.

So the fee I’d come up with is £10 a month.

That puts the price for a Sky Package that has all the sports plus ESPN and SPL TV up to £59 with the HD option putting up to £69. Now some might just want SPL TV only, so thats costing you SKY plus SPL TV so say £30-£33 a month. Some may have it all plus the movies on a HD package thats going to come in at £77-£80 a month.

Some actually said SPL TV should cost £25 a month!

For what?

Ross County versus Hibs, Aberdeen v Kilmarnock, for Celtic to run away with the league. Really you would add £25 onto your out going bills to watch that on a channel that can’t guarantee quality on the park or off it.

Say 200,000 people subscribe for £10, that gives you £2m a month. This is a high estimate.

So that is a healthy income of £20m in ten months but before tax. Takeaway the cost of say £5m to start it up and then a few million to inject into it for the season ahead. That is you now getting £13m, again before tax. If you get 200k subscribers (thats a big if) then you have to up the amount of staff, so more money going on wages/tax.

Still that looks ok.

But say the subscriptions are closer to 100k – 150k, then that takes your income to £1m-£1.5m a month. For ten months that’s £10m-£15m. But then you figure in tax, costs and next seasons budgeting and that could take you way down in profit that you then split 12 ways. Oh and then the £2m owed to the SFL a season.

Your profit would be less than the secondary deal already on offer by ESPN.

Now the first season goes by and the SPL was poor. Celtic ran away with the league, another team comfortably finishes in second but miles behind the champions and a team get relegated early doors. The standard of football is decent to poor. The coverage is very shoddy especially at the start when their is a lot of teething technical issues.

Then there is the treat of illegal streaming online that people would use rather than subscribe.

What will happen?

Yes, viewers will leave SPL TV.

That said an exciting season and a well run organisation could see numbers increase but not dramatically in my opinion.

Now I say between 100,000 – 200,000 subscriptions for a reason. The ratings that I have seen for SKY suggest that when an Old Firm side plays a non Old Firm team they get between 100k – 170k. One that doesn’t involve either side can get as little as 35000 viewers.

Now including four Old Firm games the average SPL TV audience a season is between 200k and 250k. You then have to take out the bulk of Rangers fans and a group of TV viewers that watch the odd game as it was on SKY but wont buy the SPL TV package.

These are just figures I have heard but they are realistic.

So you go to advertisers.

You will have to offer them a good deal to keep them away from SKY, ESPN and eventually BT Vision. Again SPL TV is covering a small niche market, so limiting your possible scope of advertisers and lowering the deal again.

Then say you offer a cheap deal to a company. If I were that company I would say to SKY or whoever, this is what these guys are offering, can you do better? The broadcasters have more money and if they are a cutthroat operator then they will offer a better deal in the short term.

So advertising may not make you the large amount of cash you suspected it would.

Back in early 2011 the SPL asked IMG to look at the possibility of starting their own tv network. I have never heard of the findings and since then SPL agreed the flawed deal with SKY/ESPN. That tells its own story.

So who would pay for this TV channel, that will cost millions?

Well the SPL of course. They don’t have the media/production background but who cares right? It can be done in months right?

They would start off this project with a £15m black-hole through lack of TV revenue they will have budgeted for plus the threat of other sponsors pulling out.

Can the SPL and there members take such a risk?

Possibly within time but not in a matter of months.

The fact is this idea in the short term is a non-starter. Unless you want a pathetic attempt that will fall on its face and fail. The Setanta administration and the failure of ITV Digital should show people this isn’t an idea that you can rush through and expect an immediate return from.

Raith Rovers are in a land of fantasy or at best have offered Scottish footballing fans false hope.

A lot of this article is based on facts and experience.

By all means vote for your ‘sporting integrity’ and send Rangers Newco into Division Three, I am for that but do it knowing the threat of less TV money is one hell of a strong possibility and that SPL TV can’t be done in time for next season!

8 Responses to “Why SPL TV Is A No Go”

  1. Good article, although I doubt any of these clubs fans will listen to what you say, they on one hand are blinded by their hatred of Rangers to take this into account, and in the other they will say you’re scaremongering without basing this thought on any credible theory.

  2. No chance of getting an alternative up and running for the season about to start. The current contract is renewable for the next two seasons however. SKY may well want to renegotiate but the terms will be a negotiation. You seem to undervalue the financial input from Scotland and I would suggest that a substantial proportion of that, certainly the sports package, will be at risk of a serious consumer reaction if SKY/ESPN are see to be unreasonable. The events of recent months have shown grass roots power exerted in a way previously unimaginable. Said customer base now has a taste for exerting this influence and the current broadcasters will need to tread carefully both from a fiscal and a public relations viewpoint. I am also intrigued by the notion that SKY and ESPN are joined at the hip. While I would not for a moment suggest that ESPN would view Scottish football as anything like a replacement for the lost EPL programming they may well be amenable to a relatively small financial outlay to fill some of the void. In the final anaysis the most important revenue stream by far is fans paying at the gate and the clubs are 100% correct to focus on this. A return to consistent 3.00 pm Saturday kickoffs may be a gamble but it could well be one worth taking.
    As a footnote to Southside can I suggest that any widespread feelings towards Rangers from the supporters of the other Scottish clubs is more likely to be contempt rather than hatred. I would also argue that they are in no way blinded as they are universally concerned for the future. This concern however is outweighed by the view that this organisation should abide by the rules. All relevant precedents point to a new club starting at the bottom and working their way up the leagues. The actions of the organisation during the Murray, Whyte, Administration and Green periods have been characterised by arrogance and consistent wrongdoing. Is the widespread contempt any surprise.

  3. I don’t think that SKY and ESPN are joined at the hip but have no reason to see based on ratings and possible advertising revenues for either to increase or even keep the current deals.

    This ‘fan power’ thing has worked in football because the clubs are in need of the fans to come through the gates. But the ratings show that SKY are not dependent on Scottish football fans.

    People in Scotland watch golf, F1 and EPL on SKY. Families have the movies packages and now that we are digital will families cancel their subscriptions to go elsewhere at a cost? Just for football reasons? I don’t know a family that dictates such a decision based on football.

    I agree 3pm kick offs could help increase the crowds but its no guarantee and come winter time teams may well suffer.

    According to past statements from Neil Doncaster previous sponsorship/TV deals have included an OF get out clause.

    Thanks for the comments.

  4. “…As a footnote to Southside can I suggest that any widespread feelings towards Rangers from the supporters of the other Scottish clubs is more likely to be contempt rather than hatred. I would also argue that they are in no way blinded as they are universally concerned for the future…

    Yes Andy, you keep telling yourself this until you actually believe it. When the people from SPL clubs’ supporters’ trusts were polled, of those who replied 55% stated that they would rather see their own clubs go to the wall than see The Rangers in the SPL and this after the SFA had already changed its own rules to ensure that the club could not get in to the SPL anyway -. This suggest to me that these people are not football fans but haters of The Rangers QED.

  5. I have not seen the poll you refer to but I would guess that the fans of other clubs were saying that if newco were to be allowed into the SPL this would be proof of institutionalised corruption. In these circumstances they would walk away from Scottish football forever. The overwhelming view put to the other SPL clubs was that if they supported this pprocess they would lose the continuing support of the fans. You make the mistake of thinking this was all about newco where in fact is was always about how fans would view their own clubs.

  6. Contempt and hatred are not mutually exclusive, I think fans who believe we shouldn’t even be admitted to even the SFL are basing this on their own petty hatred, I like most other Rangers fans believe we should start in SFL3, that doesn’t affect my view on the article. If you think the likes of Stewart Regan are showing favouritism towards Rangers then sadly again I believe you are one of those fans blinded by hatred, the SFA only want Rangers in SFL1 as a cash cow, as I said Rangers should start in SFL3 and let everything take it’s course, the SFL clubs should not be bullied into making decisions to suit the SFA and SPL.

  7. It doesn’t have to be limited to the SPL, everything from Scotland games, league cup, scottish cup, ramsden cup, highlights of SFL, HFL, EoSL, Juniors. It also doesn’t have to be exclusively encrypted; encrypt the ‘live games’ and show the rest FTA to increase advertising/sponorship *and* to reach as many fans as possible.
    Sky/ESPN use our game as a filler item there is no in depth stuff even about the 2 teams they are interested in, SFTV could change that

  8. Scotland games, League Cup and Scottish Cup games are all under contract with broadcasters. As far as I know these are not under threat.

    You include all the rest and the costs go up and the quality of coverage will go down.

    They can’t do the SPL properly you add the rest and you get a weaker product.

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