I: DAZN prepares to enter bidding war for Premier League TV rights with Sky Sports and TNT

Story from I:

Streaming platform Dazn will join the bidding for Premier League TV rights when a potentially “challenging” auction opens in the autumn, "I" can reveal.

The Premier League’s domestic rights raised £5.1bn the last time they went to an open auction in 2018 in a deal that changed the landscape for clubs, giving even mid-table sides unprecedented spending power to buy some of the world’s best players and cementing English football’s pre-eminence.

The rights were rolled over in 2021 to mitigate the impact of the Covid pandemic but bidding for the three-year cycle that begins in 2025 will re-open later this year, possibly as early as October according to TV industry insiders.

It promises to be a fascinating sub-plot to the start the new season as the Premier League goes to market hoping to match or better the current deal amid a cost of living crisis that has resulted in some fans ditching subscriptions with the likes of Amazon and the newly-rebranded TNT Sports (formerly BT Sport), as well a round of cost-cutting at the league’s major TV partner Sky Sports.

There will be intense scrutiny on the bidding process and whether the Premier League can buck the trend of falling rights valuations around Europe. One leading industry expert has told i that the league has its “work cut out” to match previous valuations.

In order to do that the Premier League is considering a raft of changes to its TV offering. Several sources have told i that among the things being considered are:

• Offering many more live games to bidders - possibly more than 60 extra matches - and making every Sunday game available to televise
• Reducing the number of packages that go to market from the current number of seven – which will bring an end to Amazon’s cut price £30m deal for two rounds of top flight matches
• Offering TV companies more behind-the-scenes access, including dressing room footage and flash interviews at willing clubs
• But despite being open to new technology advances, removing the 3pm blackout in the domestic market is emphatically not up for debate this time

There has been speculation that Apple may enter the bidding this time around but the tech giant indicated this week that it was only interested in global rights deals and wouldn’t be putting forward a proposal.

That comes after another possible bidder – Swedish streaming company Viaplay, which holds the rights for the Scottish League Cup and made a bid for EFL rights earlier this year – announced huge cutbacks after recording record losses.

It adds to a gloomy picture for the future of sports rights and Adam Dalrymple, a research analyst who specialises in the field for Enders Analysis, says the Premier League is entering the market at a difficult time.

“The Premier League has its work cut out for it to match the £5.1bn they raised last time,” he told i.

“All its potential bidders are in cost-cutting mode, inflation has hit consumer demand and other flagship football rights auctions in Europe have struggled to reach their revenue targets in recent months.

“However, the Premier League rights remain the most effective engine for driving pay-TV subscriptions in the UK ahead of this upcoming auction.”

And the Premier League will be heartened by the apparent resilience of Dazn, the UK streaming platform that has been investing heavily and holds Italian rights to Serie A and Spanish domestic rights to La Liga in its growing portfolio.

In a sign of its buoyancy Dazn made a bid for the EFL rights that would have made every game in the league available for broadcast which was ultimately rejected.

The company’s chief financial officer, Darren Waterman, told i that the Premier League auction is a “great opportunity” as they look to make a major impact in the UK market.

“The Premier League is the next top, top right to come to the market and we will definitely look at it, we have to. It’s a great opportunity,” he said.

“It’s not until 2025 so it’s a fair way off but yes, we’ll look at it.”

He added that Dazn could also partner the league in making every game available simultaneously in one of the Premier League’s overseas territories – another possible revenue spinner if the domestic auction falls flat.

“We have the technology to do it, they’ve seen what we can do with the NFL game pass which makes every game available to fans,” he said.

“We’re uniquely placed in that we’re everywhere so we could really help the Premier League in, say, South East Asia or South America.”

From the outside, Dazn’s global headquarters in West Yorkshire looks fairly nondescript.

But inside it is a different story. Smart offices named after some of the biggest stadiums in Europe line the corridors before you enter a room with a bank of screens. One shows a live baseball from Japan, another a WTA tennis match.

On a busy match night there can be 20, 30 or even more games screening simultaneously, engineers working feverishly to ensure everything ticks along and gets to the smart phones or TVs of customers.

It is a huge hub that few know about, even in its hometown of Leeds. One employee jokes the futuristic office complex is the city’s “best kept secret”, with few realising that it supplies live feeds of some of the biggest games for half of Europe.

That is probably because to many in this country the company is simply about combat sports – but that could be about to change.

It currently holds domestic rights to La Liga, Serie A and the Bundesliga. And while chief finance officer Darren Waterman tells i that the UK market isn’t “existential” to the success of the company, it is a market it believes it can “go big” in. 

A subsantial and groundbreaking offer to become the domestic rights partner of the EFL – which would have made every game available for broadcast – was tabled earlier this year.

It has required substantial investment but the company now has 60 million users and over 20 million premium, paying subscribers. In a difficult landscape for sports rights it is growing.

“We’ve got 2,500 employees, we’re on run rate revenue of £3bn – that’s a very large business,” Waterman says.

“We’ve been established across the world in core markets since 2016. It’s a business where you have to invest at the beginning, like any platform business you have to build the platform before you get the customers.

“You have to invest to grow your customer base. Where we are is on that path where our revenue is getting over that fixed cost.

"From an economic point of view as a fixed cost business it’s a double edged sword – when you’re below your fixed cost it’s very costly, once you’re past it you become very profitable very quickly and we’re on that precipice now and nearly tipping over. It’s very exciting times.