Decent news from the Serie A summit in Milan today (via Calcio e Finanza), as all 20 top-flight clubs unanimously voted for Lega chief Paolo Dal Pino’s plan to breakaway from the old Italian patrimony of the Sky/Mediaset era. Serie A will set up its own in-house media company, retaining to power to re-distribute the broadcasting rights (both domestic and internationally) as the league sees fit—starting from the 2021-22 season.
It’s not as radical as Napoli owner Aurelio De Laurentiis’ proposition to own the whole operation 100% and shoot the games themselves, selling direct-to-consumer online, but it’s still a significant step from the past. Instead of Serie A officials trusting that executives within Italy will grow the business of football to a competitive margin (which they’ve failed to do, time and time again), now the league chiefs have decided to work with private funds from abroad to take Serie A’s revenue and brand to the next level.
Among the funds left on the table are CVC Capital Partners, Advent and FSI’s joint bid to hand over €1.625 billion for 10% ownership of the new Serie A media company, and US-based Bain Capital and NB Renaissance Partners’ bid of €1.35 billion for 10% ownership.
If the league were to accept the highest offer on the table right now, that would already be a collective 70% increase in TV revenue for Serie A’s 20 clubs. It’s nowhere near enough to have Roma, Inter or Milan suddenly pushing around Premier League clubs and insisting they’ll sign Chelsea or Liverpool’s star players, but it’s the beginning of a lifeline to get Italian clubs over the current domestic recession, as well as easing up on the need for big player sales long-term.
How Will the New Deal Work?
We have only speculation right now, not hard details.
The league haven’t decided which offer they will take first, so it’s up to Serie A and their new equity partners’ discretion until the deal is done. But remember this an increase in revenue that the clubs are getting just for selling off a 10% slice of all future TV deals to a distribution partner. Whoever their new distribution will be, that partner will go into domestic and international markets to then re-sell the rights to broadcasters for even more revenue over the next three, four or five years.
Effectively, Serie A have locked in international interests to grow the Italian game on all fronts. Instead of dealing directly with Sky Italia execs and their low-ball offers, now the league have an international partner headhunting bigger offers from abroad, to get in competitive bids from Sky, Mediaset, FOX, ESPN and everyone.
By the summer of 2021, who knows? We could be looking at the league announcing they’ve doubled their total TV revenue for the next three years. But the fundamental problems of growing revenue long-term still remain the same.
Italian clubs still need to own their own stadia, they still need to drastically increase the quality of pitches and pitch maintenance (something with Diego Perotti brutally described as “worse than Argentina’s top-flight pitches”), they need images of capacity crowds filling up stadium seats. And a serious confrontation on the stagnant forces that prop up xenophobia and racist sentiment at Serie A games is still on the agenda.
In the short-term, however, could Roma have just found a way out of the €120 million expenses they need to settle by next summer? With only a €10 million plusvalenza from Patrik Schick’s Bayer Leverkusen transfer making any significant dent in Roma’s current financial worries, you can bet the Friedkin Era can’t wait for a new—and significantly improved—TV deal to be inked tomorrow.