Via Echo
While the Premier League ‘bubble’ has been predicted to burst for some years, world football’s most lucrative and most watched domestic competition continues to grow.
Valuations, so long having trailed the price stickers on NFL and NBA teams in the US due the greater cost certainty, have soared in recent seasons
Those soaring valuations prompted Liverpool owners Fenway Sports Group to test the water as they formalised an investment search, with a figure of more than £4bn placed on the club. United's owners, the Glazer family, are seeking £6bn plus for their asset.
FSG’s own investment search continues after the initial process determined potential partners
there is a reason why FSG decided that they didn’t want to part ways with Liverpool,
why the Glazers are still mulling over a deal that keeps them involved in some way,
and why the Saudi Arabian Public Investment Fund were willing to push so hard and be patient over acquiring Newcastle United.
Daniel Haddad, said:
"If you look at the trend for investment into football clubs and where that investment is coming from, hedge fund-backed investments or nation states etc, it hints that there is a large degree of confidence outside of the UK and at a global level that the football industry still has a long way to grow in terms of total economic size. You wouldn’t be seeing the kind of bidding we’ve seen with Chelsea and Manchester United otherwise.”
Haddad added:
"The market confidence is there. If you look back to the whole concept of the Super League it was hinting at two things. Definitely at some point, and it has been talked about to death, a breakaway from the traditional broadcasting model that still restricts football’s ability to monetise.
"We talk about sponsorship, and it still has a massive role to play, but it is a more traditional and transactional relationship whereas a more ad-led solution around content is funding media and content across verticals outside of football.
“I still think that there is a point where the broadcasting scenario changes, which means that the ability to monetise football content changes as well.
"Why I mention the Super League is that if you look through the articles of association and the memorandums that were released around that, one of the key elements was that the founding member clubs wanted to retain a lot of the broadcasting rights themselves.
"They either wanted to stream the game themselves, experiment with new technologies etc. One of the things that drove the Super League conversations was that if they could do it themselves they wouldn’t have to sell the rights to BT Sport, Sky or whoever, they could put it on their own platforms and monetise.
"It is coming at some point. Whether that is through a collective, such as the Premier League, or whether that is done through individual clubs or collective of clubs, that is something that will be coming and when it does, of the technology is right and it is made accessible enough there is a huge revenue opportunity through selling more digital and programmatic led advertising through the global stream.
“Let’s say 20 million people watched Liverpool and Manchester United globally. You could think around monetising that through audiences subscribing and buying passes to watch, but also the advertising around that. I think that is one area where there is a big upside somewhere in the future.
"The sports industry is trying to navigate that the guaranteed paychecks right now are so big that they are hard to leave behind and there would have to be a period of transition. But that kind of business opportunity is there and at some point it is unforeseeable that it doesn’t change.”
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