China Digest | CSL extends media rights deal with CSM

Weekly round-up of sports business news from the Chinese sports industry.

CSL extends rights deal with CSM

The Chinese Super League has extended its domestic broadcast rights deal with the China Sports Media agency for an additional five years after months of tense negotiations. The original five-year contract, from 2016 to 2020, was the first after the government announced widespread football reforms in March 2015, with CSM paying a stunning 8b RMB ($1.25bn), a massive 20-fold increase on the previous deal. But the effective collapse of LeSports, to which CSM sold most of the rights, depressed the market and left CSM staring at a significant loss on the final three years of its deal. However, when the Chinese Football Association introduced new policies last year to promote playing time for U23 domestic players while also restricting the number of foreigners in the league, CSM argued that the policies negatively affected their rights deal. As a result, they withheld payments and offered to spread the agreed RMB 8b over ten years instead of five. A compromise of sorts has been reached with an RMB 11b fee agreed for the ten-year deal, which will soon become official if no other competitors offer to beat the bid.

Sina partners with Mediapro to promote Golden League 3×3

With the price of broadcast rights rising rapidly in China over the past few years, it’s become increasingly common for broadcasters to try and create their own IP. Sina Sports has just signed a five-year deal with Spanish agency Mediapro – whose parent company, Imagina, announced last year it would give up a controlling stake to a Chinese firm – to promote its 3×3 Golden League basketball tournament, with the aim of taking the Chinese event to a global audience. The Golden League, now in its fourth year, is endorsed by the International Basketball Federation (Fiba) and plans to be in 30 Chinese cities this year, attracting 63,000 participants. Meanwhile, the Chinese Basketball Association has joined forces with Infront China to host a national 3×3 basketball tournament as a precursor for Olympic selection, now that the 3×3 discipline of the game will join the Olympic programme in 2020. The tournament was launched last year, with Infront, whose involvement with the Chinese national team and the CBA has boosted TV and sponsorship revenues, now brought in to maximize the commercial potential of the new competition.

Yao Ming expects CBA reforms to bear fruit

While CBA head Yao Ming has predicted China might see greater success in the 3×3 game because it’s a new format for all countries, he also says he expects the reforms he initiated last year to pay off by the time China hosts the 2019 Fiba World Cup, adding that hosting the tournament “will inject a cardiac stimulant into Chinese basketball”. Yao has been in charge at the CBA for just under a year, and has brought in a number of reforms, the most controversial of which has been separating the national team into two, parallel teams with the aim of fostering a more competitive environment. The teams are expected to rejoin in time for next year’s World Cup.

NBA plans month-long Chinese New Year celebration

The National Basketball Association has announced its largest ever Chinese New Year Celebration, with a record 93 games set to air in Greater China during a month-long festival which begins on February 2. Twelve NBA teams, including current champions the Golden State Warriors, will mark the event with themed nights in their arenas, while the Warriors and Houston Rockets will wear specially-designed Nike uniforms with Chinese characters and symbolism inspired by Chinese culture for 12 games. Now in its seventh year, the NBA’s annual celebration is a far cry from the “ethnic nights” of old when teams would slap a “Los” on jerseys and hand out fortune cookies. Sponsors including Spalding and Dongfeng Nissan have signed up to participate this year.

Guangzhou Evergrande named ‘rising star’ by Deloitte

While Manchester United drew most of the headlines from last week’s Deloitte Football Money League report, CSL side Guangzhou Evergrande made an appearance in the “Rising Stars” section. Noting that the club’s revenue was 38 per cent of Everton’s – the 20th club on the list – the report says that the Chinese football industry presents an “intriguing opportunity” given its relative lack of development and potential to operate on a far larger scale. Meanwhile, a club suit boldly predicts that up to three Chinese clubs could crack the Top 20 within a decade.

Ex- Barça CEO takes control of Chinese club

The Beijing Morning Post reports that China League Two club Beijing Institute of Technology is now half-owned by the same Hong Kong-based company that controls Spanish second-tier club CF Reus. Direct Sport Management, whose President is former Barcelona CEO Joan Oliver, acquired 29 per cent of BIT last April, and has now added an additional 21 per cent stake to reach 50 percent ownership of the club, which won promotion last year. The Chinese side was invited to train in Spain last month. Foreign ownership rules of Chinese clubs are less than clear, but this is a fascinating case study and could be one to keep an eye on.

Aussie media criticises Chinese Australian Open sponsorship

Shenzhen-based water brand Ganten took some heat at the recent Australian Open with several of the more nationalistic media outlets Down Under slamming the organizers for selling Chinese water. One on-site video reporter even managed to find a fan whose husband runs a water business, who, unsurprisingly, didn’t think the Australian Open’s bottled water should be imported. While the tournament specifically bills itself as “The Grand Slam of Asia-Pacific”, it’s a warning to brands that they are always at risk of falling victim to international politics, with Sino-Australian relations deteriorating in recent months. Interestingly, Melbourne Park’s second-largest arena has been named after Chinese electronics company Hisense since 2008, and is still widely referred to as the Hisense Arena, despite the naming rights deal lapsing last year.

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The China Digest is written by Mark Dreyer, who runs the China Sports Insider website, which features sports business news and analysis related to China’s fast-growing sports industry. He has worked for Sky Sports, Fox Sports, AP Sports and many others, and has covered major sporting events on five continents, including three Olympic Games. He has been based in China since 2007.

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