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Premier League clubs issued deadline to agree revenue-sharing reform

Premier League clubs issued deadline to agree revenue-sharing reform

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By: TV Sports Markets team

16 Apr 2018
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English Premier League football clubs will be required to make a final decision this summer on proposed reforms to the system by which broadcast rights revenue is distributed, according to multiple reports.

UK newspaper The Telegraph said Premier League executive chairman, Richard Scudamore, told clubs at Friday’s quarterly shareholders’ meeting that the dispute over their 2019-22 overseas broadcast revenue must be resolved at its annual general meeting in June.

In October, plans by the Premier League’s so-called ‘big six’ to drive through major reform to the way broadcast rights revenue is distributed were shelved, with the top division of English football stating it had become clear that there was currently no consensus for change.

The Premier League cancelled a meeting of shareholders scheduled for October 25 as it became apparent that opposition to the plan would mean that no deal would be reached. The announcement came after a meeting scheduled to discuss the new media-rights distribution model was adjourned on October 4 without an agreement having been reached.

A proposal presented by Scudamore suggested that 35 per cent of the global rights revenue should be divided between the clubs based on their final league position. Currently the rights income is split equally between the 20 clubs, but the six richest clubs – Arsenal, Chelsea, Liverpool, Manchester City, Manchester United and Tottenham Hotspur – have reportedly been pushing for a larger share.

Fourteen of the clubs needed to back the proposal for it to be adopted, and while reports in October stated that West Ham United, Leicester City and Everton had been brought on board, a final five teams failed to be convinced.

The Telegraph said two or three of the clubs who opposed the changes are set to be relegated before June’s AGM, with their votes to be transferred to the promoted teams from this season’s Championship. Wolverhampton Wanderers on Saturday became the first club to secure promotion.

The Telegraph added that Scudamore’s 35 per cent plan would have last season seen each club receive a guaranteed £25m (€28.6m/$35.6m) from overseas television rights, instead of the £39m they were given, meaning the team finishing bottom of the table would have been up to £14m worse off.

Chelsea secured a payment of more than £150.8m for winning the Premier League in 2016-17 as the first season of the competition’s new rights cycle took hold. The revenue distributed to clubs includes income generated from the sale of central broadcasting rights, both UK and international, and other central commercial rights.

The Premier League’s current system for distributing revenue sees 50 per cent of UK broadcast revenue split equally between the 20 clubs, which amounted to £35,301,989 per team in 2016-17. Twenty-five per cent of UK broadcast revenue is paid in merit payments based on a team’s finishing position in the table.

Twenty-five per cent of UK broadcast revenue is paid in facility fees each time a club’s matches are broadcast in the UK. All international broadcast revenue, and central commercial revenue, is split equally among the 20 clubs. The former figure amounted to £39,090,596 per club for 2016-17 and the latter £4,759,404.

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