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German market set for quieter period following blockbuster year

German market set for quieter period following blockbuster year

Robin Jellis's picture
By: Robin Jellis

Posted:
7 Feb 2018
Insight
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Some heavyweight deals have been struck in Germany over the past 12 months, so it was no surprise to hear at this year’s Spobis conference in Düsseldorf that no market-defining properties will be available in the immediate future.

This time last year there was a real buzz about forthcoming tenders for the Uefa Champions League and Europa League, as well as Formula One rights.

The Champions League is set to move fully to pay-TV from 2018-19 onward, after Sky acquired exclusive rights and subsequently agreed a sublicensing deal with OTT platform DAZN. This was the first time the two companies had co-operated on a property, although it is not likely to presage a wider agreement between them.

Perform-owned DAZN has yet to announce subscriber numbers since its August 2016 launch, although German experts last week put it somewhere between 100,000 and 200,000. This will increase when the new Champions League and Europa League cycle kicks in, but independent observers are intrigued to see if this swells as much as DAZN will be hoping – the German pay-TV market is still relatively immature.

Sky will be keeping a keen eye on its own subscriber numbers before the new Champions League deal kicks in for two main reasons. First, to see how much it can grow its current customer base, from about 5m, once no live Champions League matches are shown on free-to-air (matches are currently shown by public-service broadcaster ZDF and Sky). Second, to see if its decision not to renew its deal for non-exclusive Formula One rights leads to any decline.

In December, commercial broadcaster RTL renewed its free-to-air F1 rights in Germany for three years, from 2018 to 2020. Following this deal there was much speculation as to whether Sky would renew its own agreement given all races would be shown live on free-to-air. 

TV Sports Markets was the first outlet to report that Sky would not renew from 2018 onward, leaving a gap in F1’s revenues from the country but allowing the championship organisers to launch their own OTT service.

Last year also saw a landmark deal struck for Olympic Games rights in the country – public-service broadcasters ARD and ZDF came back to the negotiating table with US media company Discovery Communications to acquire free-to-air rights to the next four Olympic Games, from 2018 to 2024. This was after a breakdown in talks between the three parties in November 2016 over price.

So what will be on the market?

Certain rights will be available in the coming months, although they are of less significance than the properties sold last year. The most-discussed property at this year’s Spobis was the DFB-Pokal, the domestic cup competition, for which rights in a new cycle are expected to be offered to broadcasters this month, with bids due in March.

DFB-Pokal rights are currently split between ARD and Sky. There is set to be strong interest in the rights from free-to-air broadcasters as these matches generate high ratings. Any deal will likely be for three seasons, from 2019-20 to 2021-22, so the Deutscher Fußball-Bund – the German football federation – can re-align its sales cycle with that of Uefa.

Another property which will be offered to broadcasters in the coming months is MotoGP. Sports broadcaster Eurosport currently holds these in a four-year deal, from 2015 to 2018. MotoGP rights were held by sports broadcaster Sport1 in the previous cycle.

There may be more interest in these rights in the new cycle following the launch of DAZN, although Eurosport is understood to be keen to retain the property.

And a third set of available rights are to the country’s top-tier basketball league, the Basketball Bundesliga. Telco Deutsche Telekom currently holds these until the end of the 2017-18 season. Agreed in June 2014, it was the first exclusive live sports rights deal Deutsche Telekom had struck since losing out on rights to Bundesliga football to Sky in the 2013-14 to 2016-17 cycle. 

The telco has developed a niche of broadcasting smaller domestic sports properties, having since bought rights to the top-tier domestic ice hockey league (Deutsche Eishockey Liga) and the third-tier domestic football league (3. Liga).

Henning Stiegenroth, Telekom’s senior vice president sports marketing, was coy at Spobis last week when asked about a potential renewal of Basketball Bundesliga rights. He said: “I have been talking to Mr Holz [Basketball Bundesliga managing director] but we have not agreed anything yet.”

Local experts are also anticipating deals in the coming months for France’s Ligue 1 and Italy’s Serie A – rights which will be sold by beIN Media Group and the IMG agency respectively. A deal for Spain’s LaLiga is understood to be close, while English Premier League rights are likely to be offered to broadcasters toward the end of the year.

One property that is unlikely to be offered to broadcasters is the European Handball Federation’s Champions League. These rights are held by Sky until the end of the 2019-20 season, but coverage is set to switch to DAZN following the EHF’s announcement that it is in final negotiations for a global media and marketing rights deal with digital media company Perform and the Infront agency.

ARD and ZDF are, however, likely to have a better chance of acquiring rights to International Handball Federation World Championships in future, with these rights set to be acquired by the MP & Silva agency. BeIN, which held rights in the four-year cycle from 2014 to 2017, refused to agree a deal with ARD/ZDF due to their distribution across the Middle East and North Africa – beIN’s heartland – via the Astra and HotBird satellites.

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