The competition to control soccer TV rights is high in China. Chinese being avid fans of the sport reflect a solid market of millions of viewers. That is why, Suning, an electronics retailer in China is betting up to $2 billion to monopolize soccer broadcasting.
The Suning Commerce Group is a retail corporation with an annual revenue of approximately $22 billions owns Italian soccer club Inter Milan and is rapidly securing the right to broadcast games from Europe’s top leagues in China.
As of now, Suning already owns rights to Spain’s La Liga and the Chinese Super Leagues. Furthermore, it has already secured in-coming seasons of the top-flight German and English soccer. With all these, it is as if Suning has no plan on stopping from there as of yet. To date, the conglomerate is clawing on Italy’s Serie A and Asian soccer.
CHINA’S POWER-GRAB ON SOCCER
Suning’s monopoly on soccer TV broadcasting stems from China’s conquest of world soccer. A lot of Chinese clubs have been paying millions of dollars for high-profile soccer players. In fact, even Chinese tycoons are buying soccer clubs across nations.
Jamie Reigle, Hong Kong-based Asia Pacific managing director for Manchester United, the world’s wealthiest soccer club, said that: “Historically in China, there was good interest from fans but not a lot of competition between media rights buyers.”
This is highly evident as seen in the competition among sports broadcasters in China such as Suning and Sina Sports as well as the technology bigwig Tencent. Even so, Suning managed to stay on top of the game. They have done this through PPTV streaming website.
Jamie Reigle adds, “Now you have the digital platforms that have come in and wanted to build an audience. That’s what has changed the dynamic.”
As seen in the numbers, Chinese firms have been paying huge amounts for local and overseas rights. In fact, it has grown ten-fold over the last few years. PPTV has already paid 250 million euros ($291.4 million) in 2015 for a 5-year La Liga deal. This year, they are said to shell out $700 million for three years of English Premier League (EPL) rights from 2019. Another $250 million will be in payment for the five years of Germany’s Bundesliga.
The Italian league is aiming to produce $80 million euros per season from selling the China rights. A price tag of $240 million euros was set for a 3-year deal.
DOES EXCLUSIVE RIGHTS MEAN SURE PROFITS?
Beijing Baofeng, the Chinese owner of Italian sports media rights group MP & Silva, has an answer. He says, “Even if companies snatch exclusive content rights, to maintain influence and brand those companies will still have to repackage to TV stations at low prices or even for free.”
In China where piracy is very rampant, having viewers to pay for the match can be quite a challenge. Add to that late-day airing of overseas game; monopoly may not always guarantee immediate profits.
If Suning leads the race to soccer broadcasting is not a question, earning from that monopoly is. We’ll see.