World Cup deal done
SINGAPORE: After more than six months of nail—biting
suspense, sources have confirmed that football fans will be able to
watch all 64 matches of the 2010 World Cup finals in South Africa
’live’ on television in Singapore.
Details of the closely—guarded deal were, on Wednesday night,
still being ironed out by the two telco giants — StarHub and
SingTel.
One scenario is for the matches to be split between StarHub’s
cable service and SingTel’s mioTV. However, a source familiar with
the outcome, pointed out that if the telcos split the bill 50—50,
it was more likely that all the matches would be telecast on both
pay television platforms.
Selected matches will also be telecast live on free—to—air
television by national broadcaster MediaCorp. The number of matches
on free—to—air TV could not be confirmed but is likely to include
the opening match between South Africa and Mexico as well as the
semi—finals and finals.
TODAY expects an announcement to be made this week.
What’s the deal worth?
When it comes to the exact dollars and cents of the deal the
picture gets a little grainy, especially since both telcos are
listed.
According to sources, the telecast rights were finally
negotiated down to about US$15 million, or about S$21 million. This
is about half the S$40 million in many earlier news reports.
How does this compare to past deals? Well, now the picture gets
fuzzier. Exact numbers have never been revealed, the last deal
inked by StarHub was for two World Cup finals — 2002 and 2006 — and
given that the deal is in US dollars, the exchange rate has moved
significantly over the past decade.
It is believed that StarHub paid US$5 million for the telecast
rights to the 2006 World Cup. If so, the US$15 million figure is in
line with the three to four times more that many other countries
are paying for telecast rights this year.
So does that same three—fold multiplier apply to what fans will
have to pay to watch the World Cup? In 2006, StarHub charged a $15
subscription fee for those who signed up during their early—bird
promotion and $25 subsequently.
Said banker Kelvin Tan: "I would definitely not pay more than
$100 to watch the World Cup, at most $60 or so."
Time was running out
It was in December that StarHub and SingTel first revealed that
they had submitted a joint bid to Football Media Services (FMS),
the Asian representatives of the event’s rights holder, FIFA.
It is understood there have been at least half a dozen bids
tabled unsuccessfully. Some have blamed SingTel for its aggressive
bid of more than $300 million for three seasons of Barclays Premier
League (BPL) matches which may have sent a signal to FIFA, and its
agent FMS, that there was money to be made in football crazy
Singapore.
So why did both sides finally settle on this smaller sum?
One theory: Each day that passed without a deal meant that the
telcos had less time to score advertising deals, which are the main
source of revenue to defray their costs — short of passing them on
to consumers.
This made it less and less attractive for the telcos to raise
their bid. With the World Cup kicking off on June 11, the telcos
now have just six weeks to sell advertising.
