The newly proposed Serie A distribution network took a big step ahead today, as Calcio e Finanza reports that 15 Serie A clubs (including Roma) voted in favour of working with the joint bid from private equity funds CVC Capital Partners, Advent and FSi to distribute televised Italian football on a scale hopefully never seen before. The other 5 Serie clubs (Napoli, Lazio, Verona, Udinese and Atalanta) simply chose to abstain from voting, leaving the Lega Serie A free to move on exclusive talks with their potential new partners.
The winning bid is—at this stage—is worth 1.6 billion euros just to buy into 10% of the distribution rights for the next TV deal. That would be worth at least an initial 50 million euros (or more) into A.S. Roma’s annual budget this season, in a year where Italian clubs are announcing record losses all over the shop.
Juventus chairman Andrea Agnelli is going to have to announce the second-worse financial loss in their club’s history this week, posting up a loss of 87 million euros. Roma’s 2019/2020 losses are over twice as much as Juve’s, so this lifeline couldn’t come at a better time.
After the initial sum is paid to set up the new Serie A rights management company (of which five clubs Roma, Juventus, Bologna, Udinese and Napoli have already negotiated the structure on behalf of the league), then Calcio e Finanza claims the Lega Serie A would retain the right to buy back 100% of the distribution rights from their new partners, in the long-term future. But in the short term, the next stage would be to actually re-sell the rights won by CVC, Advent and FSi into domestic and international markets.
By the time we see this deal work to its full potential, we could be talking about Serie A collecting over 2 billion euros worth of broadcast income between 2020 and 2023. It wouldn’t be parity with the Premier League, La Liga or Bundesliga, but it would be a rate of growth the likes of which Serie A has never seen, and a crucial step in staying ahead of Ligue 1. After which, Serie A would be hoping that CVC et al. would help Italian football close the gap to Europe’s Top 3 leagues ahead of them.
CVC Capital Partners have the experience of managing and expanding Formula One into the 21st century, before the fund pulled out of motorsport over a decade ago. If Italian football could see anything like the growth that F1 did from the 1990s onwards, we’d be talking about a calcio rejuvenation. But not everyone is happy about the ad-hoc deal taking place, and there could be backlash from Serie B clubs who want a share of the new pie getting baked.
It was only a month ago that Monza director (and former AC Milan sporting director) Adriano Galliani wrote an official letter to the league, claiming discrimination against lower league clubs if Serie A divided the income from the 10% distribution stake between the top flight alone. Galliani later took to the press to re-iterate that, in his view, Italian football can’t be treated like a closed franchise system as in US sports, and Serie A doesn’t have the right to arbitrarily divide up a completely new source of income between just 20 clubs and leave the rest of the Italian football league playing catchup.
Galliani has a point. It’s the good fortune of newly promoted Serie A clubs like Benevento, Spezia and Crotone that they just happen to be in the Italian top flight at a time in history where Serie A is hunting for new, unprecedented business. But Serie A may not have a choice but to press ahead with this deal, and worry about placating the rest of the divisions later on with parachute payments, or some kind of common ground.
After all, Covid-19 positive cases are breaking out around the league. Serie A’s attempt to press on with the football calendar, and try to finish up domestic football in time to satisfy UEFA’s insistence on holding summer football tournaments, is forcing uncomfortable questions all around. There’s nothing like more money to sweep those questions under a bigger carpet.