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Serie A seeks reassurance on Mediapro guarantees as channel plan delayed

Italian football’s Lega Serie A has delayed a decision on Mediapro’s plan to launch a league channel at least until December 16.

The 20 clubs from the country’s top league were due to take a final vote on Mediapro’s latest proposal, submitted on November 4, at the league assembly in Milan yesterday (Monday).

However, no decision was taken. This marks the fourth time that clubs have put off making a final decision on the plan.

According to the Ansa news agency, 10 clubs voted in favour of the Mediapro plan, six voted against, three abstained and one was absent. A two-thirds majority is needed to approve the plan.

Those in favour were said to be: Atalanta, Brescia, Cagliari, Genoa, Lazio, Parma, Sampdoria, Spal, Udinese and Verona. Those against were: Bologna, Lecce, Inter, Milan, Roma and Torino. Fiorentina, Juventus and Napoli abstained. Sassuolo was absent.

The league’s chief executive, Luigi De Siervo, said: “It was a long discussion and at the end it was decided that a series of modifications are needed to the text [of the proposal], which is already considered by most of the clubs to be very good. It must be improved in certain aspects so we have given ourselves until December 16.”

The main issue which requires further clarification before the December 16 assembly is that of Mediapro’s financial guarantees.

The Mediapro offer is based on an annual investment of €1.283bn ($1.41bn), of which €1.15bn is for the rights, €78m for production and distribution and €55m for the clubs’ archive rights. Income above this amount would be split 75:25 in the league’s favour.

The Spanish agency and production group is not offering to underwrite the whole amount with a bank guarantee. Instead it is offering a series of payments, including an upfront payment of €200m per season, supported by a parent company guarantee provided by Joye Media, the holding company created when Chinese investment fund Orient Hontai Capital took a controlling stake in the agency last year.

Some clubs are also said to harbour doubts about the agency’s business plan. Mediapro’s projections are based on hitting four million subscribers by 2021, with an average revenue per user of €27 to €34 per month, and 50,000 to 70,000 commercial premises with an average revenue per user of €200 per month.

Another possible complication relates to Mediapro’s demand for an automatic three-year renewal of the contract should income reach €973m per season by 2023. This is the amount currently paid jointly by the two media operators which hold domestic rights, pay-television platform Sky Italia and subscription OTT operator DAZN.

It is unclear whether the league has the power to confer such an option without falling foul of the Melandri Law, which requires the rights to be made available on the open market to all possible bidders.

The channel plan would only come into force if the league failed to secure satisfactory bids from the broadcast market for its rights in the next cycle, from 2021-22 to 2023-24.

Yesterday the assembly clubs approved the guidelines for that sales process. All but two clubs voted in favour of the guidelines. Napoli voted against and Sassuolo was absent.

The guidelines will now be sent to the country’s antitrust authority (AGCM) and communications authority (AGCOM). The authorities have 60 days to respond.