Yesterday I presented the findings of a new paper at the University of Portsmouth's Research and Knowledge Transfer Conference 2012 [Link to follow]. Amongst the discussion that followed, the audience took surprise at the new Premier League (PL) auction results.
The PL increased the quantity available from 138 (of 380) to 154 matches per season to be broadcast live on television. BSkyB purchased 116, BT the remaining 38, with a total revenue received by the PL topping £1 billion a season.
There had been calls to increase quantity (including my own publications), but many expected the marginal revenue to fall from the existing £4.3 million per match (approx). The new auction exceeded all expectations, the PL new earning £6.5 million per match (approx), the equivalent of around £1,200 per second of game time.
Upon reflection of this auction, attempting to pinpoint the cause of the unexpected rise in marginal revenue is not easy to pinpoint. The European Commission has attempted to remove the exclusivity of BSkyB by bundling rights into seven packages of average equal quality and not allowing BSkyB acquire all the bundles. This creates competition amongst BSkyB and other broadcasters at auction which would likely bid up prices. Fans may now have more choice but will it cost more for subscriptions? Competition is usually a good thing but this may raise more questions about the continuing collective selling practices by the PL.
