Newcastle United – Riches Pour In From Around The World
As most of you will be aware, the domestic rights to show the Premier League on TV for 2013-2016 have just been agreed, with SKY and BT agreeing to pay over £3Billion for the three year deal.
However, on top of that the deals to show English Premier League football around the world are due to be announced in the coming months.
In the current deal (2010-13) the Premier League clubs have made £1.437billion over the three years.
Amongst the various deals which made up that near one and a half billion were £190m for rights in Singapore, £225m from the Middle East and £146m in Hong Kong. While £111m came in from Scandinavia, the remainder coming from numerous smaller agreements, a total of 81 separate deals.
It is virtually certain that there will be decent overall growth from the £1.437bn overseas total for 2013-16, and the Premier League expects to know that total by the end of October 2012; it continues to negotiate contracts around the world.
As an illustration of the amounts involved club by club, even if there is no rise in the amount the overseas deals bring in (highly unlikely!) then Manchester City’s income (via the TV deals) for winning the league would increase from £60.6m to around £90m if they won the league again in 2013-14 when the new deals kick in.
Heading nineteen places down the league, Wolves ‘earned’ £39m by finishing bottom this season and again, if overseas money didn’t increase, that would become £53.3m for the bottom club in 2013-14.
If overseas income jumps 50%, then the Premier League winners in 2013-14 would pick up £99.3m, or if it jumps by the same 70% that domestic income has jumped, then it goes to £103m.
If it doubles, the Premier League winners of 2013-14 can expect around £109m from finishing top while the bottom club might expect some £72m, or £12m more than the highest club in 2011-12.
In the first overseas deals already signed for 2013-16, Scandinavia will pay the League around double what they earned last time, helped also by the fact they have dealt direct with the broadcasters rather than using a middle man as previously.
The bottom line is that for clubs like Newcastle United and of course Mike Ashley, the riches will continue to flood in from every part of the world, the big question then is what the clubs and in our particular case, Mike Ashley, does with the money.
There is clearly the potential for the owner to take the instant benefit as cash, or take the long-term view of making Newcastle United an even more attractive future buy. (Read more on the excellent www.sportingintelligence.com )
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