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Nent’s colossal Premier League deal shakes up Nordic market

LIVERPOOL, ENGLAND - FEBRUARY 01: Mohamed Salah of Liverpool celebrates after scoring his team's fourth goal during the Premier League match between Liverpool FC and Southampton FC (Photo by Julian Finney/Getty Images)

  • Media group to pay about €390m per season for six seasons from 2022-23
  • Rights across Nordics worth about €180.5m per season in 2019-22 cycle
  • Huge blow for incumbent TV2 in Norway

Nordic Entertainment (Nent) Group’s monster six-season English Premier League deal signed this month has shocked the Nordic media market and left TV2 in Norway reeling.

The new deal, from 2022-23 to 2027-28, for rights across the Nordics (Denmark, Finland, Norway and Sweden) is worth about €390m ($427.8m) per season. This is an increase in value of about 116 per cent on the approximately €180.5m per season the Premier League earns across the same four countries from 2019-20 to 2021-22.

Nent has acquired the rights to between 237 and 250 matches per season, which it will exploit on its Viaplay streaming service. The Premier League only sold rights for 232 matches per season in the 2019-22 cycle.

The rights were sold in a tender opened on January 2, with bids due on January 29. The league made its decision after the second round of bidding, which took place on February 5. Nent announced the deal the following day.

Rival bids are thought to have come from international media group Discovery (in Denmark and Sweden), Swedish media group Bonnier (in Sweden) and commercial and pay-television broadcaster TV2 (in Norway).

TV2 blow

It is thought one of the reasons why Nent was willing to pay such a premium in the new deal was to gain a foothold in Norway.

In the current cycle, Nent holds Premier League rights in Denmark, Finland and Sweden through three separate deals worth about €96.5m per season combined. Rights in Norway are held by commercial and pay-television broadcaster TV2 over the same three seasons, in a deal worth about €84m per season.

Nent’s success in the tender is was a huge blow for TV2, which has been the Premier League rights-holder in Norway since 2010-11. The league is the key property for its sports subscription service.

A Nordic expert told SportBusiness Media: “[TV2] have done a great editorial job, have increased the value of the product by promoting it so this is going to really hurt. It is devastating news for its model.”

The Premier League is the biggest subscription driver in Norway, ahead of both the domestic league and Uefa’s Champions League. In the latest deal, it is thought at least 50 per cent of the value comes from Norway.

TV2 does currently hold rights to the Champions League (through a sublicensing deal with Nent), as well as Uefa Europa League and Norwegian national team football matches. However, as another Nordic expert said: “Norway has the most willingness to pay for content [in the Nordics], and the Premier League is king.”

Costly win

Several market experts spoken to by SportBusiness Media have questioned Nent’s ability to monetise an investment of this scale. The broadcaster has often surprised the market over the past two years with its willingness to spend big fees to seal select properties.

It was aggressive in its pursuit of International Handball Federation rights and European Handball Federation rights in 2018, and last year it shocked the market by acquiring Fédération Internationale de Ski (Fis) World Cup events and 2025 Alpine and Nordic World Ski Championships. It has since also invested in International Skating Union and International Ice Hockey Federation rights, increasing their values by 133 per cent and 35 per cent respectively.

Its initial aggressive bidding in 2018 came at a time when Nent was preparing to be listed on the Nasdaq Stockholm stock exchange. It started trading in March 2019.

The Premier League deal is a continuation of Nent’s emphasis on live sport as a subscription driver, at a time when many entertainment studios, such as Disney, are creating their own direct-to-consumer products, thus pulling back entertainment content from traditional broadcasters.

Most experts believe Nent will likely increase subscription prices when the new deal begins, to help finance its outlay.

Additionally, the media group could also seek improved carriage deals as well as sublicense some Premier League content. In the 2019-22 cycle, it sublicenses 116 non-exclusive matches in Denmark to quadruple-play service provider YouSee, a deal thought to cover half Nent’s Danish Premier League costs.

Timing

SportBusiness Media understands that Nent was the instigator of the Premier League’s decision to go to market early – just six months from the beginning of the 2019-22 cycle. The decision was a surprise to market rivals.

It is thought that the timing of the tender was key for the media group as it believed rivals would struggle, given such a short space of time, to put together serious competition considering the high investment and long-term nature of the deal. There were only 20 days from the announcement of the tender to the date by which potential bidders had to send details of financial security.

US-based media group Discovery is perceived by the market as unable to react quickly. Bonnier’s owner, telco Telia, was and still is involved in protracted carriage negotiations with Swedish cable television operator Con Hem.

There is precedent for Nordic broadcasters influencing the Premier League’s sales process. Nent and TV2 convinced the league not to launch a tender in the region for the 2019-22 cycle and to instead enter private negotiations. At the time, market experts thought the league could have earned far more if the rights had been offered to the market.

Champions League

Nent’s Premier League deal is likely to affect the upcoming sales process for Uefa club competitions from 2021-22. Uefa is set to launch tenders imminently.

Nent holds top-tier Champions League rights in the current cycle, from 2018-19 to 2020-21, in Denmark, Norway and Sweden. Rights in Finland are held by pay-television broadcaster MTV3.

Though not as popular as the Premier League, these are premium rights that Discovery, Bonnier or TV2 could pursue.

Discovery holds rights to the domestic top-tier leagues in Denmark (until 2023-24), Norway (until 2022) and Sweden (until 2025). The Champions League could present an opportunity to enhance its offering in each market.

For Bonnier, it will be a better opportunity to acquire premium rights following its acquisition by telco Telia.

For TV2 in Norway, the tender will be especially important as experts suggest a “complete rebuild is needed” now it’s clear its Premier League coverage will end with the 2021-22 season. With the domestic Eliteserien rights unavailable till 2023, TV2 faces a six-month period without premium content if it fails to win Champions League rights.

For any of them to prize the rights from Nent, even given its Premier League outlay, may prove difficult. The media group has held Champions League rights in Denmark, Norway and Sweden since at least the 2009-10 season.

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