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EXCLUSIVE: Details emerge of IMG’s commission-based five-year Brazilian league proposal

Diego of Flamengo celebrates after scoring against Avai at Maracana Stadium on December 05, 2019 (Photo by Bruna Prado/Getty Images)

A proposal from the IMG agency for international rights to Brazilian football’s Campeonato Brasileiro Série A covers five seasons, from 2020 to 2024, but would provide no minimum guarantee payment to the clubs, it is understood.

It emerged this week that IMG is among a trio of companies that has been in rights conversations with the Brazilian Football Confederation (CBF), which is representing the 20 top-tier clubs.

Specific proposals have been made by IMG over the marketing of the international broadcast, betting streaming, data and sponsorship rights that it is targeting.

SportBusiness understands that the proposal on the table does not include a minimum guarantee for the international media, betting streaming or sponsorship rights, with a commission-based model adopted instead.

This model, it is thought, would provide IMG with a 20-per-cent sales commission on net revenues up to $5m (€4.56m), a 25-per-cent commission on revenues between $5m and $10m, and a 30-per-cent commission on revenues above $10m. The agency has provided an annual forecast of projected revenues within its proposal.

No final agreement has been made with IMG, nor has its proposal been ratified, but the agency is considered to be in a strong position to secure a contract. Proposals from Brazilian streaming platform TVN Sports and Brazilian betting operator Betsul are also thought to have been under consideration.

A minimum guarantee offer is understood to have been proposed by at least one other sports marketing company of note, but it is currently not thought to be among the trio of proposals set to be discussed at a clubs meeting on Thursday.

SportBusiness also understands that a sizeable sponsorship rights inventory to be provided by the clubs also forms part of the IMG proposal. This includes the commercialisation of a league title sponsorship, category sponsorship and a presenting partner package.

While a commission-based model for media and sponsorship rights sales is one adopted by some smaller or mid-tier leagues, the lack of minimum guarantee for the betting streaming rights is somewhat unusual by market standards. IMG Arena, the agency’s betting arm, would be expected to sell the betting rights to its bookmaker clients if a deal was completed.

The absence of a minimum guarantee, tallied with the scale of rights inventory that would be commercialised by IMG and technical costs that would be recouped by the agency, leaves the CBF and clubs to weigh up whether they would be getting full market value for their rights, which were not offered in an open tender.

IMG, which declined to comment on the nature of its rights proposal when contacted by SportBusiness, has proposed that it handles the production and distribution of just two matches per league round for international broadcast. Additional games will be produced to the standard necessary for broadcast on betting platforms.

Production of the matches has been handled until now by Globo, the heavyweight Brazilian media company and domestic rights-holder.

Within IMG’s proposed production and distribution set-up, it has been put forward that IMG can retain all technical costs, which would be deducted from net revenues.

The CBF and Brazilian clubs last year restarted the international rights sales process after the collapse of a proposed agreement with the Sport Promotion agency. That deal, which was backed by Swiss investment fund Ecotonian, covered a four-plus-six-year period and included exclusive local-language international media rights, non-exclusive Portuguese-language media rights and clubs’ pitchside advertising rights.

International rights were held by Globo between 2016 and 2018 under its domestic rights deals with Série A clubs. Globo also held pitch-side advertising rights to all 20 clubs on an individual basis.

TVN Sports is involved in streaming Brazilian football through its rights deal for the Campeonato Catarinense, the state league in Santa Catarina, while Betsul’s interest is sure to have been piqued by the betting streaming rights on offer.