Kelvin MacKenzie has ruffled a few feathers this week in his backlash against broadcasting deals and Satellite TV would expect no less from Mr Vocal. Love him or hate him, we look at exactly what his problem is.
We have reported a lot recently about BSkyB, Murdoch, Premier League televised deals and broadcasting tenders. The combination seems to have caused some tension with the former Sun editor and he vented his anger.
The main point in question is surrounding the deals made between BSkyB and the football powers that be. In a deal worth £195 million, the Football League have agreed live match broadcasting rights of the lower leagues exclusive to BSkyB, whilst in a separate deal the Premier League agreed on a 5 in 6 live match exclusive. MacKenzie has deemed these deals to be a ‘racket’ and ‘wholly illegal’ which leads to ‘warehousing’ – overpaying for rights that you never use. The point of this is to quash your competition by not allowing them a chance to broadcast any matches.
MacKenzie points out that these deals are anti competitive and when he compares it to the monopolies that used to dominate utilities, we can start to really see the validity of his argument. Monopolies were broken up to allow the gas and electricity markets to become more competitive. If these utility companies were to behave as BSkyB, Premier League and Football League are, they would be fined drastically and action taken. Anti-competitive behaviour is illegal and as MacKenzie points out, it is still rife in the world of sport.
MacKenzie is annoyed because as founder of Sports Tonight, his business is disadvantaged when it comes to securing Premier League broadcasting rights, as are other small broadcasters. MacKenzie points out it breaches EU directives and in an indirect attempt to push Ofcom to investigate the broadcasting deals, MacKenzie voiced his concerns. He also said:
“If there was no football on Sky the share price would probably halve tomorrow, but why should consumers pay to keep the Sky share price up?”
Although he has not made an official complaint (yet), Ofcom have a duty to investigate any implication that a deal is harming the market so these exclusivity arrangements may become a thing of the past.
We have reported a lot recently about BSkyB, Murdoch, Premier League televised deals and broadcasting tenders. The combination seems to have caused some tension with the former Sun editor and he vented his anger.
The main point in question is surrounding the deals made between BSkyB and the football powers that be. In a deal worth £195 million, the Football League have agreed live match broadcasting rights of the lower leagues exclusive to BSkyB, whilst in a separate deal the Premier League agreed on a 5 in 6 live match exclusive. MacKenzie has deemed these deals to be a ‘racket’ and ‘wholly illegal’ which leads to ‘warehousing’ – overpaying for rights that you never use. The point of this is to quash your competition by not allowing them a chance to broadcast any matches.
MacKenzie points out that these deals are anti competitive and when he compares it to the monopolies that used to dominate utilities, we can start to really see the validity of his argument. Monopolies were broken up to allow the gas and electricity markets to become more competitive. If these utility companies were to behave as BSkyB, Premier League and Football League are, they would be fined drastically and action taken. Anti-competitive behaviour is illegal and as MacKenzie points out, it is still rife in the world of sport.
MacKenzie is annoyed because as founder of Sports Tonight, his business is disadvantaged when it comes to securing Premier League broadcasting rights, as are other small broadcasters. MacKenzie points out it breaches EU directives and in an indirect attempt to push Ofcom to investigate the broadcasting deals, MacKenzie voiced his concerns. He also said:
“If there was no football on Sky the share price would probably halve tomorrow, but why should consumers pay to keep the Sky share price up?”
Although he has not made an official complaint (yet), Ofcom have a duty to investigate any implication that a deal is harming the market so these exclusivity arrangements may become a thing of the past.
