SWhich channel will French football fans be able to watch the first day of Ligue 1, Friday August 16? Less than two months before the resumption of the national championship, the suspense remains. The Professional Football League has still not signed a broadcast agreement for the period 2024-2029. The more time passes, the more uncertainty increases among club presidents, whose budgets largely depend on this annual income.
State of play with Luc Arrondel, sports economist and research director at the CNRS.
Point : Less than six weeks before its resumption, the League still does not have a broadcast agreement. Is the situation becoming urgent?
Luc Arrondel : It is all the more urgent as clubs are finalizing their budget for the coming season, without knowing how much they can count on. First consequence: the transfer market is currently blocked in France. The situation is not ideal at all.
At the start of the negotiations, the president of the Professional Football League estimated the League at 1 billion euros. Then to 500 million euros now. But considering that it is the market which determines the value of the product, how much is Ligue 1 worth today?
Its price remains difficult to evaluate objectively. Everything depends on the interest that broadcasters have in buying this product. The price that Ligue 1 is worth is the one that its broadcaster is ready to invest for, no more and no less. But the interests of broadcasters are not all equal. You can buy broadcasting rights for different reasons, such as wanting to weaken your rivals. To do this, you will buy a product more expensive than what it is really worth with the sole aim of crushing the competition.
We can also buy a product like Ligue 1 because we hope to resell part of it to other broadcasters. But in our current case, I have the impression that we are at the stage where we will try to make the investment profitable from subscribers alone.
Is the LFP’s strategy of setting a price of 500 million euros, of estimating a number of subscribers to set the monthly cost of the subscription, the right one?
It is quite difficult to evaluate objectively. During his hearing before senators within the commission on the financialization of football, the president of RC Lens, Joseph Oughourlian, mentioned the notion of investment price which is not stupid at all: if you pay more, the product will be of better quality and a virtuous circle will be established. But the first year, you will pay an amount more expensive than the value of the product and you will hope to recover this investment in the following years.
The initial idea, the famous billion, was not outlandish, if we compare ourselves to the similar markets of our neighbors, Italy, Germany, England or Spain. Except that that is obviously not enough and we must also look at the competitiveness of our championship in relation to the famous “Big Four”. And in the light of our results in the various European competitions, we can criticize the president of the LFP for having a short-term vision, by only aiming for the domestic championship without trying to shine on the European scene.
READ ALSO TV rights: why French football is not worth 1 billion eurosDo you think that TV rights take up too large a share of Ligue 1 clubs’ budgets?
This is a difficult question, because a football club is not a business like any other. Generally speaking, in order not to be dependent on one source of income, it is necessary to diversify them. If we look closely at the big European clubs, the increasing revenues are not those from TV rights, but rather commercial revenues, even in England. This is the example of PSG in France, whose share in the budget is less than 30% while the average is between 35% and 40%, or even nearly 70% for the clubs of Lorient or Montpellier.
Don’t some players have salaries that are too high?
Let’s not forget that France is operating in a European market. The demand for players is high. I don’t think we can blame clubs for their management of the payroll in general. Whatever the championship, the payroll in a club represents between 65% and 75% of the budget. And they have always operated like that. That’s why football clubs are not like other businesses and it is rare for them to make a profit.
READ ALSO TV rights: “French football saw itself more beautiful than it was” Is a disaster possible for Ligue 1?
One thing is certain, the clubs will have to tighten their belts. Club payrolls will fall and this risks leading to a sale of the best players and therefore a drop in the general quality of Ligue 1. I thought the situation would be resolved sooner. The problem is that the longer we wait, the more the negotiating power shifts to the side of the broadcaster and the lower the total amount will be…
