Wednesday 18 September 2019

Premier League cash bubble threatened by Saudi-based TV piracy

'Up to £650 million of rights packages for UK sports – the majority of which ends up in Premier League clubs’ pockets – will eventually be at “significant risk”, broadcaster beIN Sports has warned'
'Up to £650 million of rights packages for UK sports – the majority of which ends up in Premier League clubs’ pockets – will eventually be at “significant risk”, broadcaster beIN Sports has warned'

Tom Morgan

Premier League clubs are being warned that their bubble could burst in the next broadcast deal, after one of their biggest funders recorded a multi-billion pound hit from the ongoing theft of television rights coverage in the Middle East.

England's top-tier football clubs, as well as the Champions League and Wimbledon, are being used as pawns in a worsening diplomatic spat between Saudi Arabia and Qatar.

Up to £650 million of rights packages for UK sports - the majority of which ends up in Premier League clubs' pockets - will eventually be at "significant risk", broadcaster beIN Sports has warned.

Yousef Al-Obaidly, chief executive of beIN, said: "This is - without doubt - one of the largest and most damaging heists in corporate history."

Saudi-based beoutQ - a satellite service which can be picked up around the world - has been stealing and repackaging broadcasts from Qatari-based beIN Sports for two years.

Should the piracy continue, beIN Sports, which has lost revenue across the Middle East and Africa, is almost certain to reduce its offer for three-year rights packages for UK sport.

Devastating

As one of the biggest overseas rights holders, a renegotiation could have a devastating impact on overall market values.

The Premier League is understood to believe Saudi Arabia's current status as a potential safe-haven for piracy is the greatest legal threat it currently faces.

"It represents a territory where we can't get any legal recourse," a source close to the situation said.

"That sets a trend that is very worrying. It's what it represents. It's our long-term partners that are badly damaged and we really need to protect them."

Any threat to value of overseas rights for the Premier League could have dramatic consequences.

Speaking in May, Richard Masters, the interim chief executive of English football's top flight, revealed that a drop in the value of the league's domestic rights has been offset by overseas broadcasters, who are paying around 30 per cent more for games during the next three seasons.

The league has set up an anti-piracy unit in Singapore and has won renewed powers from the High Court to immediately delete illegal streams.

However, all attempts to stop beoutQ have fallen flat. Legal threats have fallen on deaf ears and Saudi Arabia has even ignored warnings that FIFA could eventually ban the nation from competing at the World Cup.

Footballing bodies believe the Middle East nation has turned a blind eye to "widespread and flagrant" breaches because of its rift with Qatar, where beIN Sports holds the commercial rights for the Middle East. The spat has escalated as Qatar prepares to host the 2022 World Cup.

In May, the Digital, Culture, Media and Sport select committee in Britain heard evidence that beoutQ had pirated content from "100 UK-based" channels including the BBC, but embassy approaches in Riyadh have failed to yield any breakthrough.

The channel is broadcast on Arabsat - a Saudi-based satellite network - and beIN Sports is convinced that the broadcaster is supported by the Saudi government.

BeIN, which confirmed the saga had cost the broadcaster $1 billion (€890,000) in legal fees and lost revenue in the first six months alone, said diplomatic sanctions were now the only option.

The Premier League, Wimbledon, BBC, Sky and beIN are all in discussions with the UK Government to find a solution.

Al-Obaidly said: "We know who is doing it, where and how they are doing it and also the reasons why. It is brazen commercial theft by Saudi Arabia and a complete disregard of international law and norms.

"However beoutQ's destructive actions have direct and long-term financial implications for sport in the UK. The natural consequence of Saudi Arabia's industrial-scale piracy is major international broadcasters - who have invested billions of pounds in the UK economy for exclusive media rights - will refuse to pay those enormous fees in the future."

BeIN's deal to cover Formula One in the Middle East and Africa, worth an estimated £250m (€270m), expired at the end of the 2018 season, and the broadcaster did not renew it due to beoutQ.

Overseas

Overseas rights to every Premier League game until 2022 are currently worth a combined £4.2bn (€4.55bn), up from £3.1bn during the previous three-year cycle.

The increase made up for the drop in value of the Premier League's domestic rights, which Masters said were now worth £5bn compared to £5.4bn paid by Sky and BT Sport for the 2016 to 2019 term.

For the Premier League, the Saudi Arabia affair is a source of huge frustration as it believes it is winning its war on piracy elsewhere.

Most of beoutQ's viewers are in Africa and the Middle East, but the league recently swooped on a shop on London's Edgware Road that was allegedly selling beoutQ services.

One of the most popular illegal streaming services - Ronaldo7 - was closed down after the league tracked the business down to a home in Portugal.

The Saudi Government has been contacted for comment. The Daily Telegraph has also made attempts to reach beoutQ. (© Daily Telegraph, London)

Telegraph.co.uk

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