MTG eager to retain long-held Champions League rights
By Martin Ross
Modern Times Group has expressed its intention to hold on to rights to the Uefa Champions League, as the Scandinavian media group mulls the nature of the offer if must submit to the Team Marketing agency by 8 May.
The sales process in Denmark, Finland, Norway and Sweden was recently launched by Team, and MTG has underlined its determination to retain coverage of Europe’s elite tournament from 2018-19 onwards in the face of heightened competition from the Nordic arm of Discovery Communications.
Speaking on an investors call this morning, Jørgen Madsen Lindemann, MTG’s president and chief executive, said: “We have had the Champions League for 25 years and we have invested a lot into the product and we have a lot of customers who are very happy about the product.
“We do hope that we will be able to continue to show the Champions League [from 2018] when this auction is over. As always, what we do in these cases is that we understand and analyse what we believe that the product is worth.”
The existing Champions League agreement in Denmark, Norway and Sweden was the first signed by Team in the last rights sales process, as MTG dug deep to pay significantly more than the total fee of just under €200 million (now $214 million) that it paid for the rights from 2012-13 to 2014-15.
Lindemann appears braced for another price hike going forwards, saying today: “It is fair to assume that these very important stories, be it sports, drama series or the best movies, will always increase in cost. That is just a fact.”
Team’s invitation to tender for the Champions League rights in the Nordic countries was launched on 10 April. The agency also initiated the sales process for the Europa League broadcast rights in Finland only.
MTG shows the Champions League across its free-to-air channels and the Viasat pay-TV platform.
In 2015, MTG acquired the Champions League rights in Finland in a separate sales process, replacing MTV Finland as a rights-holder. MTG's acquisition was not entirely exclusive as YLE, the country’s public-service broadcaster, retained rights to show live matches on Tuesdays.
Competition in the Scandinavian market has increased with the formation of SBS Discovery Media (now Discovery Communications Nordic).
Discovery, which owns the Eurosport channels, recently acquired the rights to Sweden’s Allsvenskan from 2020 onwards. It already holds rights to the Danish Superliga and Norway’s Elitserien, and has also invested national team soccer rights and handball.
Q1 results and eSports MTG reported net sales of SKr4.23 billion ($469.6 million) for the first three months of 2017, a 10.5-per-cent increase on the same period last year.
Operating income rose to SKr183 million, a 15-per-cent jump attributed to higher profits for both the Nordic and international entertainment businesses.
MTG stated: “This was the third consecutive quarter with organic sales growth of more than 5 per cent, which demonstrates that we have more relevant products available to more customers than ever before.”
Last month, MTG announced that it was to sell its broadcasting business in the Baltic region to Providence Equity Partners, the private equity investment firm, in an agreement valuing the operations in Estonia, Latvia and Lithuania at €115 million.
In March, MTG was also named las one of the backers of the World Boxing Super Series, a new tournament offering $50 million in prize money.
The broadcasting group has stressed that it expects its 'MTGx' eSports division to break even in 2018 (excluding activities at online games developer InnoGames in which it holds a majority stake).
MTG has been on the front foot in the eSports sector in recent years, as shown by the €78-million acquisition of 74 per cent of Turtle Entertainment, the eSports firm that operates under the ESL brand, and a deal worth SKr244 million to acquire DreamHack, one of the leading promoters and organisers of eSports events.
Lindemann said that MTG helped to distribute broadcast rights to the ESL’s recent Intel Extreme Masters in Katowice to 70 international broadcasters in 19 languages.
On the widespread interest in eSports shown by rival media companies, he stated: “There are a lot of people who would like to enter this very interesting space and we are very focused on continuing to create the right events with the right teams. We will produce the biggest tournaments… you will see that more and more people will try to enter the space, which is actually good news for us as it then also increases the interest for eSports and also increases the interest from the advertisers.”