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What does the MLS’ $2.5bn streaming deal with Apple mean for the Premier League? ⚽️

For the first time in history, fans will be able to access everything from a major pro sports league in one place. On paper, it sounds great. So, why wouldn't the Premier League strive for this 'streaming nirvana'?

Last week, Major League Soccer agreed a $2.5 billion streaming deal with Apple TV which sees every match available to subscribers anywhere in the world from 2023. For the first time in history, fans will be able to access everything from a major pro sports league in one place, explained Eddy Cue, Apple’s SVP of Services. “No fragmentation, no frustration - just the flexibility to sign up for one convenient service that gives you everything MLS."

Major League Soccer agreed a $2.5 billion streaming deal with Apple TV

As a result, it's caused a lot of envy for fans of the Premier League. A league where a similar idea has been mooted for a while now – particularly off the back of the pandemic, where UK fans got a taste for life without the 3pm watershed.

Simon Jordan is a particularly strong advocate of the idea, suggesting that this MLS deal is simply showing how football and other sports are going to go. He broke down the premise on his radio talk show as follows;

By ditching its traditional broadcast partners (Sky, BT etc.) and building its own ‘Netflix of Football’ platform, he believes the PL could earn 4x its current £3bn per year. That’s based on a back of a napkin calculation that £9.99 per month x 100m subscribers brings in 12bn per year.

Jordan does go on to acknowledge there would be some associated costs, but also that there is a lot of room to grow in terms of both price point and subscriber base - and that revenue figure offered is before you even account for advertising.

On paper, it sounds great. So, why wouldn't the Premier League strive for this 'streaming nirvana'?

Let’s dive a bit deeper 👇

Problem #1: Ditching its broadcast partners 📺 Since its inception, the PL has been built on Sky. This isn't just an issue of biting the hand that feeds you, but more like biting your own hand. And it isn't just an issue for the PL with Sky either. The PL's broadcast partners globally are essentially also marketing partners - without them you lose significant reach. Domestically, the PL benefits from Sky, BT, Amazon and the BBC all having an interest in promoting the league. Internationally, local broadcasters are able to increase the league's relevance in market - take NBC's ad series with Ted Lasso, for instance.

Problem #2 Getting Clubs onboard ⚽️ It was reported in Feb 2020 that the league had considered trialling an OTT service in Singapore. The move was rebuffed as Clubs were unwilling to give up the guaranteed income of a traditional, territorial rights deal, even in a (relatively) small market. The certainty provided by the current broadcast model is important because of one crucial fact: Every club needs money up front. When Clubs are trying to improve their squads in a transfer window, they need to know how much money they've got to spend. Sport is yet to have its ‘Bob Iger moment’. Iger knew to build Disney+ he’d have to lose millions in the short term - pulling content from Netflix and restructuring the organisation to be more consumer-facing. At this moment, there's little chance Clubs would buy into that vision. Problem #3 Huge associated costs 💰 While Jordan acknowledges that there would be associated costs, he likely under-estimates how great they would be. As Richard Gillis explained to The Athletic, to create ‘Premflix’ would require a “total transformation of the organisation’s culture and personnel.”

Reorienting the Premier League's business to be consumer-facing would be incredibly expensive. It would also give the league a lot of headaches. Right now, the PL never has to deal with customer payment issues or complaints about buffering. Why would they want to change to that? The answer is, they probably wouldn’t. So, what is the more likely outcome?

One option is that a streaming platform with huge reach decides to buy the full international rights for every country outside of the UK. This would take a lot of cash though (The $2.5bn Apple paid the MLS over 10-years would likely cover just one year for PL). For Apple TV in particular, they are likely going to want to test the water with their current partnership with the MLS for a while before they commit to something as big as the Premier League.

Therefore, the most likely outcome is that the Premier League moves to a mix of direct-to-consumer and traditional media rights sales. Essentially, there won't be an all or nothing movement but a gradual evolution. The first step towards achieving this will be for the Premier League to trial a streaming service in a market where the league feels they're not going to get a good traditional deal - as was previously touted for Singapore. This would likely also be complimented by a concentration of the traditional rights so that there are fewer, but bigger broadcast partners internationally (as we've seen in the Nordics with Viacom). Either way, the concept of 'Premflix' is, unfortunately, a long way off. The threat of it, however, certainly does provide the league with greater leverage in negotiations with broadcasters - so don't expect the narrative to disappear anytime soon.


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