So SingTel has won the right to air the English Premier League (EPL) on mio TV in August 2010. Incumbent StarHub is staring at a financial black hole, especially since ESPN Star Sports is also walking out the door next year into the loving arms of SingTel (for a nice fat fee, no doubt).
EPL fans have been moaning and groaning, writing in forums, sending letters to the newspapers. Words like “anguish”, “daylight robbery” have been used.
Then no less than acting minister for the Ministry of Information, Communications and the Arts (MICA), Lui Tuck Yew, gets hauled into the debate with a quote on CNA saying:
“What we will be doing is we will invite SingTel and StarHub to come in and share with us their plans and their intentions, going forward. When we have a better understanding of what they intend to do, that will put us in a better position to determine if any intervention is needed,” he said.
Wah! You mean watching foreign talents playing football at inflated wages has become a staple like rice? Remember when rice prices went through the roof and the government also intervened?
Is it THAT serious? Are people going to starve without EPL?
You’d think SingTel was holding a gun to everyone’s head, saying “Your money or your EPL.”
Nobody is forcing you to pay, what.
I threw out StarHub cable about eight years ago because I had enough. Do you know how much money we are all giving the foreign talents in England? It’s anywhere from $75 million to $105 million a year. EPL chairman Richard Scudamore and company are laughing at us every three years when the contract renews.
Are we collectively mad or what?
SingTel is estimated to be paying $400 million for the three-year deal starting in August 2010. So they pay $400 million. They have to cover their costs, right? And they have to make a profit while they are at it too, right?
So who are the suckers who will help them pay for it?
I’ll leave you to answer that question but I recall a certain quote from the movie Forrest Gump:
Stupid is as stupid does.
Quick Facts about the EPL Broadcast Rights
The Football Association Premier League owns the television broadcast rights
StarHub has broadcast the EPL since 1997
StarHub paid an estimated $250 million in 2007 for the broadcast rights for three seasons (2007/08 – 2009/10)
SingTel lost to StarHub in 2007
250,000 to 350,000 estimated subscribers for the Sports Group Package on StarHub
Sports Group Package costs $25 per month (up from $8 in 2004)
CIMB investment research house estimates that SingTel paid about $400 million for the broadcast rights for three seasons (2010/11 – 1012/13) on mio TV
ESPN Star Sports will leave StarHub and join SingTel mio TV in May 2010
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[…] I wrote in the comments section here on Red Sports the other day that if SingTel mio TV doesn’t charge you around $70 to $80 a month for the English Premier League come next August 2010, they will lose their pants from having paid an estimated S$400 million for the broadcast rights for three years. […]
Singtel should buy our S-League clubs
No one bothers to watch and it is available for free on Channel 5, meaning to say that no one is going to pay more than $1 per month for S League.
You just ask anyone who watch soccer, how much per month you are willing to pay to watch S League?
I am a EPL & starhub fan i wun change to MIOtv.so wat dun watch EPL now the contract with singtel is 3 years after 3 years starhub with back how?change to starhub again.there is no loyalty to starhub.
My guess is that SingTel could just be using this whole thing to build their brand than to really be cutting a huge profit out of it. Their core sustainable business is still the telcom industry.
In recent years, StarHub has leveraged on their cable TV as well as providing free public wifi across the island to strengthen their positive brand image and visibility as a telcom provider.
So SingTel’s priority in this whole gimmick may not be profit-making (in the early years at least) or even to break even, because any reasonable “loss” in this may just count towards “strategic advertising slash brand building” costs in that sense.
@Les
If they chare $70-80, then they will not get the 250k subscribers? It’s demand/supply and economics.
But I believe that they have done their research, if not they will make the decision to bid for it at the price they did. Ultimately, it is a business decision on Singtel’s part.
If the decision was flawed, then it will be clear that Singtel will take a profit hit. Even so, it is unlikely to shake the boat, as Singtel as deep reserves and steady revenue stream from other divisions.
And just to share a piece of story from UK. Sentanta Sports did something like Singtel in 2007 – bidding way over the top for the Premier League. They did a massive advertising campaign, but ended up only getting something like 1/2 of the subscribers they need to stay alive. 2 years later, Sentanta laid themselves with debt and with bankrupt.
My point is, winning Premier League TV rights is not the end game, it is the beginning.
It is a free market – price will be set by market forces. If singtel overprices themselves, customers will move away and they will have to lower it. Over a medium-term, there will be equilibrium price – a level where people are willing to pay to support the cost of providing it (with reasonable profit)
@kar-teck: I was just calculating that SingTel will have to charge about $45 just to cover the cost of the EPL rights fees (this assumes the analysts estimate of $400 million for 3 years is correct and that SingTel gets 250,000 subscribers).
If you add in the extra fees they paid ESPN Star Sports as well as the Champions League and Serie A, as well as to make a profit, what are consumers looking? At least $70-80 a month?
I was an epl football fan once but stopped watching. Amazing how much time you have suddenly when you throw out the cable set top box!
Very aggressively-worded post but everything you say makes sense to me!
(But then again I’m not a hardcore soccer fan.)
Singtel should buy our S-League clubs…not support those foreign football!!!
I’m cancelling my Starhub subscription next year and going to the coffee shops to watch.