Newcastle United’s TV money – Who profits?
Tuesday afternoon brought the revelation that the latest Premier League TV money deal wouldn’t be huge, it would actually be huge with a cherry on the top.
The UK rights portion of the English clubs’ TV money will go up by 70% compared to the current deal, this will come into effect with the 2016/17 season for a three year time span.
Over £5.1billion will be banked by the Premier League over the 36 months but when it comes to Newcastle United, who will actually profit from the deal?
Well if the 0verseas deals show a similar 70% increase then you are talking Newcastle United banking around £130m in 2016/17 if producing a similar performance as last season (2013/14), this would represent over £52m more than the £77.4m Mike Ashley/NUFC cashed in on for last season.
Only two weeks ago the club reference the upcoming announcement of the TV deal as a reason for freezing season tickets.
28 January 2015 Newcastle released the following –
‘Newcastle United have announced a freeze on the price of all season tickets for next season.
The Magpies have taken the lead in ticket pricing over recent years, with initiatives including hugely popular long-term season ticket price-freeze deals.
The decision to freeze all other prices has been taken in line with the Club’s policy to make football affordable, reward loyalty, and also takes into consideration that by the start of next season Premier League clubs will be aware of the value of the new television rights deal negotiated by the Premier League with broadcasters, to commence in 2016/17.
To ensure season ticket holders gain maximum value and to further reward their loyalty, for next season single tickets for the higher category games will be subject to a price increase’.
The question surely must be, with all of these tens of millions extra coming in each season (on top of the extra tens of millions this current deal has generated), why then would you put any ticket prices up? The answer of course is because Mike Ashley can and due to the fact that game such as Sunderland and Manchester United sell out at St James Park.
Demand exceeds supply for those premium games, unlike most other home matches these days, so there is money to be had, regardless of the fact that all of that extra TV cash is flooding in.
I am amazed that there is still any Newcastle fan who swallows the club’s/Ashley’s line above, talking of a club policy ‘to make football affordable’. Mike Ashley will charge as much as he believes he can do to maximise revenue. Against Stoke the cheapest tickets were £20 for adults and £5 for kids, against Manchester United in March the cheapest (outside the family enclosure) are £42 for adults and £21 for kids.
Those prices would be charged every week if there were enough people willing to pay Mike Ashley for the privilege. Simple fact is though that any hopes/expectations have been drained from the Newcastle fanbase, the football on offer is generally poor along with the results, while Ashley has the third biggest ground in the Premier League to try and fill. He has to try and set the right price for every match, or else he won’t have the essential bodies as the backdrop to the adverts for Sports Direct and his other brands that overwhelm St James Park.
I especially like the part of Mike Ashley’s justification in charging more to fans who buy tickets game by game, saying that it is to ‘reward the loyalty’ of season ticket holders’ and ensure they get ‘maximum value’. You would have to be a pretty sad person to take pleasure in your fellow fans having to give Mike Ashley more money, just because they don’t have a season ticket and possibly can’t afford one. Yes, take their eyes out poor suckers, get their £35 membership off them and let’s see how much higher I can make those cheapest £42 tickets for them to watch us play Sunderland and the other United.
Published on The Mag 10 February 2015 –
‘The deal announced today is for three years starting with the 2016/17 season, in total the Premier League will bank £5.13billion and remember the overseas deals are still to be announced. The new deal represents a massive increase of around 70% on the current UK rights deals which pays £3billion over three years.
The previous one before that was £1.77billion, an astonishing rise in such a short space of time.
If the overseas deals show a similar 70% increase, the £77.4m that Mike Ashley banked last season from Newcastle United’s Premier League broadcasting, for a similar performance you would be looking at a figure of around £130m in 2016/17.’
Mike Ashley has made some stupid decisions at Newcastle United but he isn’t stupid. He has made many cunning moves, just as he’s done in the rest of his business empire.
Maybe the most cunning at St James Park, especially because it convinced a lot of fans that they were the big winners out of it, was the ‘season ticket price freeze’. The guarantee that your season ticket would stay the same price for ten years and of course the majority of season ticket holders signed up for it.
The really cunning part of course is that Mike Ashley designed it to hook and hold supporters, changing their decision from a simple season to season one as to whether they’d renew or not. The clever bit is that you have to decide in January whether you want to stop going the following season. No publicity at all is given by the club to this renewal deadline and of course at that time most fans still want to believe that better times could be just around the corner and giving up your ‘price freeze’ season ticket at that point could be a risk. If you change your mind after cancelling, if things pick up on the pitch, having to pay X amount more if you changed your mind in the summer and bought one again, and so on.
Effectively, Mike Ashley has taken the wind out of the sails of the renewal period and subsequently the chances of unrest and any campaign not to renew etc unless at least a realistic portion of the extra TV money is released for investment in the squad.
The saddest part is that Mike Ashley could be making a generous profit AND everybody watching better football via investment in the team, plus also bringing prices down certainly when this new TV money deal hits in 2016.
The possibilities are endless and no wonder Everton, Spurs, Manchester City, West Ham, Swansea and others are looking have expanded capacities. The riches flowing into Premier League clubs will make it all but impossible for but a handful of the European elite to compete financially with them. This is a time for English clubs to invest in their fanbase and drive customer/fan loyalty. Not put the prices up for the matches that they can and tell fans they are doing them a favour by freezing season ticket prices when morally (and there’s an argument it would also make long-term financial sense in terms of making sure of fan loyalty) they should be coming down.
The club recently admitted that they could expand the Gallowgate end for no more than £30m and get the capacity up to around 60,000. If 50,000 watch the current rubbish/mediocrity, just what could be the limit with a little bit of ambition and success? Especially in a world where English clubs would very likely dominate global football.
Newcastle United/Mike Ashley have dismissed the idea as not cost-effective but if these new-found riches aren’t going to go on ambitious team building, why not do some long-term good with a small part of the extra TV money which could help secure NUFC’s future health?
Apart from blind loyalty, the relationship between fans and Newcastle United is almost non-existent in the present day.
With just a little bit of care and attention, along with X amount of the EXTRA TV money being used for the good of the club and the supporters, Newcastle United could be a great club.
That is the most frustrating thing of all, one word from Mike Ashley and we could all have really exciting times to look forward to. I won’t hold my breath.
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