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  • 3 months later...

Ligue 1 tv deal collapses after the league gets Setana'd

 

Exhausted, dehydrated and stranded, surrounded by sand dunes and a cloudless sky, sweat is wiped from the brow. The sight of palm trees and a sparkling lake in the distance flickers and then vanishes. This is the situation in which Ligue 1 has found itself this year. After being starved of success, French clubs hoped they would be revitalised by an unprecedented TV rights deal worth more than €1.15bn per year (€814m a year from Mediapro and €330m from BeIN Sports). It was the second largest TV deal in Europe, but the mirage finally disappeared this week, pushing French football to the brink of financial ruin.

There had been concerns about Mediapro from the start. When the rights were sold in 2018, critics pointed out that a similar deal with Serie A had fallen through because the Spanish broadcaster had not offered adequate financial guarantees. Gaetano Miccichè, the president of Serie A at the time, said the assurances provided by Mediapro were “unacceptable”. Worryingly, Nice CEO Bob Ratcliffe said earlier this year that, as far as he understood, the LFP had “never asked for” similar guarantees.

Former Nice president Gauthier Ganaye made the same point earlier this year, saying: “What worries me is: did the league take all the necessary guarantees to make sure that Mediapro could actually deliver and pay the money they said they would? We could end up in some serious cash situation for some clubs, so that’s why I really hope the league took all the guarantees and the executives at the league did their work very diligently, to make sure there is no problem further down the line, because that could cause massive trouble to French football.”

The numbers were huge, with clubs now bringing in 60% more money in TV rights. Maxime Saada, the Canal Plus chairman, insisted at the time that Mediapro had overpaid. “I am disappointed that we didn’t keep the rights but the price was completely unreasonable,” said Saada. “It was impossible for us to make these sorts of figures work and I believe it’s impossible for any actor in the sector to make these sorts of figures work.” He has been proven right.

Mediapro charged customers €25-per-month for their subscription channel, Téléfoot, which showed eight Ligue 1 matches and 10 Ligue 2 matches in every round of fixtures, meaning they needed more than four million subscribers to turn a profit. The channel also broadcast Champions League and Europa League games, but these were shown simultaneously by rival broadcaster RMC Sport. Their gamble did not pay off.

By April, Mediapro’s already precarious position was further weakened when their credit rating was downgraded. Mediapro insisted this was due to the effects of Covid-19 and that they would recover quickly. Somewhat surprisingly, they paid the first €172m instalment of the season a day early in August.

However, when their second instalment was due in October, Mediapro asked to defer the payment and their CEO, Jaume Roures, admitted that they were trying to renegotiate the deal. “It’s obvious that Covid is affecting a lot of aspects of our being able to exploit our rights.” said Roures. “We want to renegotiate the contract for this season. We are not questioning the project as it is, but the bars and restaurants are closed, advertising is down.” L’Équipe reported that Mediapro wanted a 25% discount for the season, while RTL claimed that the LFP were hoping to replace Mediapro.

The LFP’s lack of due diligence and failure to seek guarantees from Mediapro was catastrophically naive and incompetent. Given the rewards on offer, Mediapro’s deal was accepted almost without question by French football. When the deal was agreed in 2018, Lyon president Jean-Michel Aulas said it was “a blessed day for French football.” Speaking as recently as September this year, Lorient president Loïc Féry said: “This is a very important year for French football, given that media rights are very significantly up for the first time. I wouldn’t be surprised if you have top French clubs signing some UK players.”

French clubs were already financially vulnerable due to the early cancellation of the 2019-20 season. Ligue 1 watched as the rest of Europe’s biggest leagues installed methods of testing and isolating, and then completed their seasons largely without major incident.

The surprise cancellation of the Ligue 1 season seemed to have arisen due to a misunderstanding by the French government. In October, multiple Ligue 1 club presidents told Get French Football News that one of their main motivations for not finishing the 2019-20 campaign was to protect the new Mediapro deal, harming their relationship with Canal Plus in the process.

Last week it was confirmed that Téléfoot, Mediapro’s subscription service, would close as a renegotiated deal could not be agreed. Téléfoot will continue to broadcast games until a replacement is found and, after mediation in France’s commercial courts, Mediapro have agreed to pay €100m of the outstanding €324.8m owed thus far. Having agreed to pay €3.25bn over four years, Mediapro have paid less than 10% of that figure over just four months.

For now, the LFP and French clubs are surviving due to a pair of government-backed bank loans. The first was taken following the Covid-19 crisis and the second when Mediapro missed their payment in October. Canal Plus are now negotiating to take over the rights, but they intend to offer a sum below €700m per season – less than they paid before the arrival of Mediapro.

French football’s crisis is far from over. Canal are playing hardball over the deal and some clubs are worried about going bankrupt. “When you don’t have any TV rights money, ticketing money or hospitality money, you’ll have to explain to me how we are supposed to keep our business running,” said Reims president Jean-Pierre Caillot earlier this month. “If the league cannot get a new loan, which is far from assured at this point, I think that in February or March, there will be a lot of clubs who will not be able to pay their players and employees. Because we often forget that a football club is not just 11 players.”

A government bailout had been rumoured but Jean-Michel Blanquer, the minister of education and sports, says this is unlikely. “We cannot, in business life, take risks of this type and then call in the state like a firefighter with public money to somehow cover the costs,” he explained.

Criticism of the Mediapro farce has been unanimous. “We had to deal with very dishonest people,” said Lille coach Christophe Galtier. Lyon manager Rudi Garcia said it was “a big blow for French football”. PSG president Nasser Al-Khelaifi called for a full investigation into the bidding process and demanded that the LFP take legal action against its former CEO, Didier Quillot, who was responsible for brokering the deal. Al-Khelaifi was shut down by his fellow board members on the second request, but Quillot has offered to refund the €500,000 bonus he received from the LFP for securing the deal.

Despite obvious and legitimate concerns over Mediapro’s speculative business model and cashflow from the outset, success-starved Ligue 1 blindly believed in the mirage. That lack of foresight has proven costly.

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Ligue 1 tv deal collapses after the league gets Setana'd
 

Exhausted, dehydrated and stranded, surrounded by sand dunes and a cloudless sky, sweat is wiped from the brow. The sight of palm trees and a sparkling lake in the distance flickers and then vanishes. This is the situation in which Ligue 1 has found itself this year. After being starved of success, French clubs hoped they would be revitalised by an unprecedented TV rights deal worth more than €1.15bn per year (€814m a year from Mediapro and €330m from BeIN Sports). It was the second largest TV deal in Europe, but the mirage finally disappeared this week, pushing French football to the brink of financial ruin.
There had been concerns about Mediapro from the start. When the rights were sold in 2018, critics pointed out that a similar deal with Serie A had fallen through because the Spanish broadcaster had not offered adequate financial guarantees. Gaetano Miccichè, the president of Serie A at the time, said the assurances provided by Mediapro were “unacceptable”. Worryingly, Nice CEO Bob Ratcliffe said earlier this year that, as far as he understood, the LFP had “never asked for” similar guarantees.
Former Nice president Gauthier Ganaye made the same point earlier this year, saying: “What worries me is: did the league take all the necessary guarantees to make sure that Mediapro could actually deliver and pay the money they said they would? We could end up in some serious cash situation for some clubs, so that’s why I really hope the league took all the guarantees and the executives at the league did their work very diligently, to make sure there is no problem further down the line, because that could cause massive trouble to French football.”
The numbers were huge, with clubs now bringing in 60% more money in TV rights. Maxime Saada, the Canal Plus chairman, insisted at the time that Mediapro had overpaid. “I am disappointed that we didn’t keep the rights but the price was completely unreasonable,” said Saada. “It was impossible for us to make these sorts of figures work and I believe it’s impossible for any actor in the sector to make these sorts of figures work.” He has been proven right.
Mediapro charged customers €25-per-month for their subscription channel, Téléfoot, which showed eight Ligue 1 matches and 10 Ligue 2 matches in every round of fixtures, meaning they needed more than four million subscribers to turn a profit. The channel also broadcast Champions League and Europa League games, but these were shown simultaneously by rival broadcaster RMC Sport. Their gamble did not pay off.
By April, Mediapro’s already precarious position was further weakened when their credit rating was downgraded. Mediapro insisted this was due to the effects of Covid-19 and that they would recover quickly. Somewhat surprisingly, they paid the first €172m instalment of the season a day early in August.
However, when their second instalment was due in October, Mediapro asked to defer the payment and their CEO, Jaume Roures, admitted that they were trying to renegotiate the deal. “It’s obvious that Covid is affecting a lot of aspects of our being able to exploit our rights.” said Roures. “We want to renegotiate the contract for this season. We are not questioning the project as it is, but the bars and restaurants are closed, advertising is down.” L’Équipe reported that Mediapro wanted a 25% discount for the season, while RTL claimed that the LFP were hoping to replace Mediapro.
The LFP’s lack of due diligence and failure to seek guarantees from Mediapro was catastrophically naive and incompetent. Given the rewards on offer, Mediapro’s deal was accepted almost without question by French football. When the deal was agreed in 2018, Lyon president Jean-Michel Aulas said it was “a blessed day for French football.” Speaking as recently as September this year, Lorient president Loïc Féry said: “This is a very important year for French football, given that media rights are very significantly up for the first time. I wouldn’t be surprised if you have top French clubs signing some UK players.”
French clubs were already financially vulnerable due to the early cancellation of the 2019-20 season. Ligue 1 watched as the rest of Europe’s biggest leagues installed methods of testing and isolating, and then completed their seasons largely without major incident.
The surprise cancellation of the Ligue 1 season seemed to have arisen due to a misunderstanding by the French government. In October, multiple Ligue 1 club presidents told Get French Football News that one of their main motivations for not finishing the 2019-20 campaign was to protect the new Mediapro deal, harming their relationship with Canal Plus in the process.
Last week it was confirmed that Téléfoot, Mediapro’s subscription service, would close as a renegotiated deal could not be agreed. Téléfoot will continue to broadcast games until a replacement is found and, after mediation in France’s commercial courts, Mediapro have agreed to pay €100m of the outstanding €324.8m owed thus far. Having agreed to pay €3.25bn over four years, Mediapro have paid less than 10% of that figure over just four months.
For now, the LFP and French clubs are surviving due to a pair of government-backed bank loans. The first was taken following the Covid-19 crisis and the second when Mediapro missed their payment in October. Canal Plus are now negotiating to take over the rights, but they intend to offer a sum below €700m per season – less than they paid before the arrival of Mediapro.
French football’s crisis is far from over. Canal are playing hardball over the deal and some clubs are worried about going bankrupt. “When you don’t have any TV rights money, ticketing money or hospitality money, you’ll have to explain to me how we are supposed to keep our business running,” said Reims president Jean-Pierre Caillot earlier this month. “If the league cannot get a new loan, which is far from assured at this point, I think that in February or March, there will be a lot of clubs who will not be able to pay their players and employees. Because we often forget that a football club is not just 11 players.”
A government bailout had been rumoured but Jean-Michel Blanquer, the minister of education and sports, says this is unlikely. “We cannot, in business life, take risks of this type and then call in the state like a firefighter with public money to somehow cover the costs,” he explained.
Criticism of the Mediapro farce has been unanimous. “We had to deal with very dishonest people,” said Lille coach Christophe Galtier. Lyon manager Rudi Garcia said it was “a big blow for French football”. PSG president Nasser Al-Khelaifi called for a full investigation into the bidding process and demanded that the LFP take legal action against its former CEO, Didier Quillot, who was responsible for brokering the deal. Al-Khelaifi was shut down by his fellow board members on the second request, but Quillot has offered to refund the €500,000 bonus he received from the LFP for securing the deal.
Despite obvious and legitimate concerns over Mediapro’s speculative business model and cashflow from the outset, success-starved Ligue 1 blindly believed in the mirage. That lack of foresight has proven costly.

Interesting reading - I didn't know the French had (what appeared) the 2nd biggest TV deal in Europe.

Is this a recent development or have the clubs known for some time that the TV deal was a bit of a farce? I did notice that a few French clubs paid fairly big money (in comparison to previous seasons) for players in the summer. If transfers were made under the expectation of receiving big TV money then there could be a very similar situation to what Scottish clubs faced with the Setanta fiasco.
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It's Pochettino for PSG - https://www.bbc.co.uk/sport/football/55436136.

Former Tottenham manager Mauricio Pochettino is the main contender to take over at Paris St-Germain after Thomas Tuchel was sacked.

It is understood PSG's players have been told that the Argentine, 48, will be joining the club.

Talks between PSG and Pochettino started at least two weeks ago.

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  • 2 weeks later...
  • 3 months later...

Bordeaux placed into administration after US owners pull their investment

Ligue 1 club Bordeaux have been placed in administration after American-based owners King Street said they no longer wished to support the club financially.

The former French champions have been struggling financially due to the impact of the COVID-19 pandemic, and the premature end to the 2019-20 season also resulted in a loss of income when the league season was cancelled.

Bordeaux said club president Frederic Longuepee turned to the commercial court for security while "a lasting solution" is found.

The club's problems were compounded when Spanish media rights agency Mediapro, which had won TV rights for a record €780 million ($936.23m) per season over the 2020-24 period, went bankrupt and missed payments last year.

A club statement on Thursday read: "The economic context linked to the COVID-19 pandemic and Mediapro's withdrawal has caused an unprecedented drop in revenues for French football clubs.

"These events are in addition to the financial consequences that already hit clubs hard last season when the championship ended and the loss of income that ensued.

"These circumstances led the president to protect the club by placing it under the protection of the Bordeaux Commercial Court. An ad hoc representative has been appointed, he will be responsible for assisting Bordeaux in their search for a lasting solution."

King Street took over the southwestern club in December 2019 and has invested €46m ($53m) since.

Bordeaux were a standout club in the 1980s, winning four French leagues. The most recent of their six titles came in the 2008-09 campaign.

Former Arsenal and France defender Laurent Koscielny is the club captain, and they also boast former Newcastle United winger Hatem Ben Arfa.

Bordeaux are 16th in the league table this season, only five points above the relegation zone with five matches remaining.

Bordeaux mayor Pierre Hurmic expressed his frustration at King Street's decision.

"Unfortunately it's not a great surprise for me," Hurmic said in a statement. "From the outset the takeover of the club, which I voted against in 2018, did not seem to ensure durability.

"That seems to have been confirmed now. A page must be turned. Everything has to be done to find a solution that ensures the longevity of the club."

However, club president Longuepee is unpopular among supporters, and the Ultramarines 1987 -- an influential and long-standing fan group -- demanded his "immediate departure" on their Twitter page.

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Great title race in France this year. If Lyon had won today, it would have been 4 teams within 2 points, and 4 games to go.

Incredible comeback from Lille to remain top of the league, though - which also pretty much eliminates Lyon from the running.

Would love to see Lille win it, but will settle for anyone that's not PSG.

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14 hours ago, Nightmare said:

Great title race in France this year. If Lyon had won today, it would have been 4 teams within 2 points, and 4 games to go.

Incredible comeback from Lille to remain top of the league, though - which also pretty much eliminates Lyon from the running.

Would love to see Lille win it, but will settle for anyone that's not PSG.

If Lyon winning didn't leave PSG in pole position then it would have been good however as PSG will likely win their last 4 games Lille winning is probably the best result for PSG not winning it again. Lyon also play Monaco next so they could have dented all 3 challengers which would aid PSG. Lens to play Lille, PSG and Monaco in the run in.

Great stuff, a 4 way title run in down to the last few games should be what football (or any competitive sport) is all about. 

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  • 3 weeks later...

Wild down the bottom of the table as any of  the teams in 13th-18th can in theory finish in the relegation playoff spot currently occupied by Nantes. Nimes were relegated yesterday & Dijon were down ages ago currently being 27 points behind Nimes.

Down in Ligue 2 Troyes finish as winners by five points & return to the top flight after last being seen in 17-18. Clermont come up as runners up & next season will be their first ever in the French top flight. Toulouse, Grenoble & Paris FC finish in the playoff spots. At the other end of the table LB Châteauroux & Chambly are relegated to the Championnat National with Niort taking the relegation playoff spot.

On subject of the Championnat National it was won by SC Bastia who continue their climb up the leagues after being demoted from Ligue 1 to the 5th tier Championnat National 3 back in 2017. Get the derby back next season against AC Ajaccio as well.

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