In light of yesterday’s news on the Premier League’s new pay-per-view offering we caught up with the club’s deputy chairman and chief executive Paul Barber for a Q&A earlier today.
Here is what Paul had to say…
How did the deal come about? Why now are fans being asked to pay for something, which last season and for the first month of this season, they got free as part of an existing package?
Last season, at the Government’s request, the Premier League made all its games available, some free to air, some via existing subscription platforms. To be clear, these matches were not included in any existing package fans may have bought from Sky or BT. This was a short-term measure designed to support the government and help supporters of all Premier League clubs through the lockdown period. But, unfortunately, and for very obvious reasons, giving away the very product that we are in business to sell to broadcasters and directly to fans at our stadiums isn’t sustainable in the medium or long term if we are to keep our clubs viable; and, in our case, sustain close to 2000 jobs that directly or indirectly depend on us.
However, by way of further support to fans, we extended the additional coverage for the opening four match rounds of the current season too. Again, these were matches that were not included in any existing broadcast package fans may have purchased. Supporters’ groups had already asked the Premier League about a solution to watch all their teams’ matches while they are played behind closed doors, and it was one of those groups that initially suggested a pay-per-view route when it was made clear we couldn’t sustain what we did at the end of last season, and continue to give away additional matches for free.
The EFL quickly adapted to the idea, and has been offering a limited broadcast of all its matches for £10 per game on its iFollow platform.
Isn’t £15 for a Premier League game a bit steep?
Ultimately it is broadcasters who independently set prices for PPV games. Clubs were made aware of the pricing at our meeting on Friday. Clubs do not retain all of the revenue not least because there are considerable costs incurred in providing this new service.
Secondly, the PPV product being offered for Premier League matches is far superior to the EFL’s iFollow offer which is priced at £10. The cost of the Premier League’s PPV offer is also significantly less than the typical rebate our fans will receive for each match they miss at the Amex.
For fans in a multiple season ticket household, the savings on watching each game will be even more significant as they will receive multiple rebates but pay only one PPV fee, indeed if they choose to do so at all. And while we would encourage everyone to stick to the rules and maintain social distancing, it is also possible for people to group together as two households and watch in parties of six or less. While Government rules allow, some people may even choose to watch the game in the pub with friends and other fans.
The PPV offering also potentially provides all fans with access to away fixtures that they might not have got to see even in normal times. The costs of a full scale live broadcast are not small for broadcasters, and neither are the significant scheduling challenges for the Premier League and clubs to ensure all matches can be broadcast live in any match round. We can only estimate what we think the PPV take-up might be, but unfortunately, however helpful it might be, this source of revenue will not come anywhere close to replacing the revenues stadium crowds provide.
Is this a dangerous step? If all games become available this way won’t crowds be hit at all levels when fans can return?
This is a short-term measure, let’s not forget that. Our absolute priority is to get fans back in the stadium as soon as possible. At the moment, we desperately want things to go back to normal in all forms of day-to-day life, but that isn’t possible yet. Once things return to normal we will likely revert back to the way things were, certainly for the length of the existing broadcast deal. This, hopefully short, period with PPV will however provide some interesting learning for broadcasters and for the Premier League and its clubs.
In the meantime, I really don’t know of any businesses that are expected to give away their core product for free at any time, and least of all during a time when jobs and livelihoods are threatened everywhere, including in football clubs up and down the country. We are trying to do the best we can to be fair to fans in an incredibly complex situation, while also protecting our business, and the jobs of our staff, as we work our way through an unprecedented crisis. Thankfully, the vast majority of supporters understand and respect that, and are fully behind us as we do so.
Why can’t clubs stream and offer these games free to season-ticket holders? They are our most loyal of fans?
Clubs don’t have the infrastructure to do this at this time and the costs would likely ramp up the selling price even higher. We can rely on our rights-holding broadcasters to deliver a world class PPV broadcast product on a par with what fans are used to: multi-camera shoots, replays, commentary, punditry – and via a very stable and recognised delivery method. Anything we do over and above our existing broadcast commitments must also fit with those existing broadcast contracts, and be approved by our existing partners, so this is a highly complex area.
As for the question on only making PPV games available to season-ticket holders out through a voucher, we understand it just isn’t technically possible at this time. For example, how do you put your season-ticket number into a set top box? The timescales to achieve this would also have been very short, the administrative costs would have been high, multiple season-ticket households would have potentially been out of pocket, and we actually felt it was important to give fans the choice to watch the games as soon as possible rather than focus on a technical solution that we may not need for long.
Importantly, season-ticket holders will not end up out of pocket. We have already made it clear, several times now, we will be refunding or rebating any matches fans are unable to attend; whether the match is behind closed doors, or limited capacity and they miss out in any ballot. As well as payment holidays last season, we have already frozen payments to season-ticket holders after six monthly payments this season. We appreciate the issue of personal cashflow is understandably becoming an increasing problem for some of our supporters. We have a board meeting early this week to review this again, as we have done periodically throughout the pandemic, and if there is any change to our existing policy we will update fans as soon as we are able.
In the meantime, if fans can bear with us, we will, as we have throughout the pandemic, keep them informed through our open lines of communication. We also intend to hold an online Q&A for season-ticket holders this coming Tuesday evening. Of course, I’m happy to take emails from concerned supporters, and have responded personally to all of those who have emailed me directly in the past 24 hours, but I would ask that fans keep things polite and respectful. A small number of fans have let themselves down over the past 24 hours, and we have previously warned of the serious consequences for being abusive towards the club’s staff. It is unacceptable and it won’t be tolerated for any reason.
Why did the clubs and the Premier League get less money for more matches last season?
Quite simply, we failed to complete the season within the terms of our contract with our broadcast partners. As such, the broadcasters were entitled to a rebate under the terms of the contract. The rebate cost each club many millions of pounds on top of the losses already incurred through season-ticket rebates, sponsor rebates, and also the matchday losses of gate revenue, hospitality sales, merchandise sales, and non-matchday revenue.
What about transfer fees and wages, as we’ve just seen clubs splashing out millions of pounds on both?
In a football club, players are our most significant assets. We need the best possible players to be competitive. And, by definition, we are also in a competitive market when it comes to securing and retaining the services of the best players. I think the vast majority of fans appreciate that. I can only speak for Brighton & Hove Albion when it comes to the main transfer window that has just closed, but we were very pleased with the business we did, and we were very careful with the money we spent on fees, wages and agent costs. Ultimately, the investments we did make were, as usual, fully underwritten by our chairman Tony Bloom, who all our fans know only too well has the club’s very best interests at heart. Tony will always have an eye on the club’s long term aspirations and needs, as well as the short and medium term; but we haven’t invested huge amounts, we have been careful.
Somewhat ironically given today’s mailbag, I was receiving messages and reading many comments from fans suggesting we should have been doing even more transfer business at the start of this week, and then by the end of the week, it has come full circle with some fans criticising us for the cost of the business we have done. In some cases I have received emails from the same fans on both subjects! Our job is to get the balance right and I think at Brighton we did just that.
In terms of the club finances, I cannot dress it up, we have been badly hit by the pandemic. We were already budgeting for a large loss, but this has increased considerably and fans will see that when we publish our annual accounts as we do every year, later this winter, but the important thing is that we are coping, adapting and being creative to cut back costs and look at new revenue streams. One of those revenue streams, while we can’t allow fans to come into the stadiums, is to generate revenue from pay-per-view matches. One certainly won’t come close to replacing the other, but it will help us in the short term.
I have regularly pointed out that Tony and the board refused to use furlough for the club, took no government handouts or loans, and we are standing on our own two feet, paying our bills and keeping our head above water. It isn’t easy for anyone right now, but with the help of the supporters, sponsors and partners, and with the hard work of the board, executive team and staff we are doing what we need to do. I take it as a personal responsibility that there are thousands of local people whose income relies on the football club, and I will do all I can to ensure that continues for as long as is possible.
Would players be asked to take wage cuts?
It is a complex issue, and as ever one which makes for good soundbites from politicians, good copy for some sections of the media, and of course healthy debates amongst some fans. The politicians appear to forget how much of player salaries go into public coffers. For example, here, at Brighton, we contributed £54m in taxes the season before last, with a large chunk of that from taxes on player wages. Footballers pay a huge amount of revenue into government coffers, and continue to do so.
As for players taking cuts in their wages as yet we haven’t had to revisit that. It will be the chairman’s call if we do. Player contracts are fixed term and guaranteed. Last season, the players - supported by directors, staff and fans - made some considerable personal and collective donations to charity to help many local good causes and the NHS, and they were prepared to step up further if the situation became worse, and we were unable to play games at the start of this season. Fortunately, the season is now underway, and we hope we can keep it on track.
Should the Premier League be using this pay-per-view cash for bailing out the EFL clubs?
Our club has always been mindful of where we came from, and not that long ago either. However, our immediate priority and our most pressing responsibility is to our own club, our own staff, and our own community. If we can help others after that, then we are entirely open-minded to doing so.
We know exactly how important the football pyramid is to the country, the clubs, the fans, and to the respective communities clubs up and down the country serve. We have spent all but eight seasons of our 119-year history in the lower leagues, so we know what it’s like, but there is a misconception that all Premier League clubs are awash with cash and can ride to the rescue. I’m afraid this is simply not correct for Brighton, and neither is it correct for many other Premier League clubs.
Are you disappointed by the Government’s current stance on not allowing fans back in stadiums?
Frankly, yes, but, as difficult a job as they have right now, I am more frustrated by the apparent lack of consistency in Government policy. It is currently okay for the Royal Albert Hall to sell more than 50% of its capacity for an indoor event in December, but it is not okay for a football club in any of the top six levels of the game to sell 25% of its capacity at an outdoor venue in the same month. It is okay for cinemas to show our matches live in their indoor venues now, and charge our fans for the privilege, but not okay for us to allow those same fans to sit outdoors in our stadia. It is okay for groups of people to gather indoors in a pub to watch a live football match at any time, but it is not okay for clubs to offer those same people to sit outside in our stadia. You get the drift! It’s frustrating and confusing, and putting the very existence of football clubs at all levels at significant risk.
Of course we won’t be reckless. People’s health remains paramount, as does protecting the NHS’s precious resources, particularly in the upcoming winter months. But we do want to be able to stand on our own two feet and, as I have said, one way we can do this is to allow for the safe, secure and gradual return of supporters. Perhaps it is time for the MPs in those smaller towns to step up and realise just how much football contributes to the nation, not just financially, but in terms of community, health and wellbeing, civic pride and so on. My sense is that many MPs could do more to support their local clubs. MPs tend to be very vocal, and critical of the football authorities, when clubs have gone out of business but now is a time we need them to be vocal to stop clubs disappearing by helping us get fans back in to stadiums. I have spoken to a number of politicians on the issue, and Hove MP Peter Kyle in particular has been very helpful in recent days. Now other entertainment-based industries are benefitting from the Government’s policies, and that’s great, we have no problem with that and want them to do well too, but football urgently needs the same support.