The Premier League have misjudged the market in China once already, Dominic Fitzsimmons writes

China, the world’s most populous country and one visited by Premier League clubs each year, may seem to be prime territory for Game 39, but a pay-TV deal that has effectively taken the “world’s biggest league” off the air in the world’s biggest TV market has undermined its popularity. By pricing ordinary fans out of a chance to watch matches, the deal may undermine Richard Scudamore’s new scheme.

In late 2007 the Premier League inked a three-year contract with a little-known pay-TV station, WinTV, a deal rumoured in the Chinese press to be worth a paltry £25 million – £5m less than this year’s bottom club will receive in TV cash and a fraction of the £2.7 billion the league is set to earn in broadcasting rights over the next three years.

In the first six months of the deal WinTV has sold just 20,000 of their 588 yuan (£39) annual subscriptions, way short of their 1.2 million target and a tiny fraction of the ten million fans who regularly tuned in to watch games for free in this country of 1.3 billion. If a Game 39 match were held in Beijing’s new National Stadium, there would be four times as many people in the ground as would be watching on television here.

The broadcaster has tried to recoup some of its costs by striking a deal with web portal Sina, which offers a webcast season ticket for 380 yuan (£26) or each match at 3.8 yuan (30p). A source inside state-run sports channel CCTV5, which used to air games for free, says he is surprised the Premier League went with the WinTV deal: “They have to balance sponsorship with exposure and they went with the money. And in their scale of earnings it is not that much money for even less exposure.” CCTV5, he added, would be only too happy to step in should the existing deal fall apart, “but we are not prepared to pay as much as WinTV”.

“We’re just trying to promote this concept, the idea that people should pay for this kind of service,” a WinTV spokeswoman told reporters. “It may take some time,” she added.

“We’re only six months into a three-year contract. If subscriptions grow, current concerns will be alleviated,” a Premier League spokesman repeats, mantra-like to every inquiry. But Premier League sources suggest that they merely fulfilled the club’s brief to them: to get the highest price possible when negotiating rights, implying that the clubs have only themselves to blame.

“All broadcasting deals are collectively bargained by the Premier League and this deal is a matter for them, and that’s all I’m prepared to say,” says Simon Greenberg, the communications chief of Chelsea. The deal puts a large dent in the Blues’ extensive China campaign: last year they launched their Chinese website and hosted the Chinese Olympic squad as one of the key partners in the Asian Fooball Confederation’s Vision China campaign; this month they launched Super Soccer Star, a Pop Idol-style TV show that will pluck four promising teens from south China to train with the club.

“I have always followed Chelsea but I’m not going to spend my money on something that has always been free. What if I have to work late and miss a match I have already paid for? These days I have been watching Real Madrid’s games,” says Beijing office worker Song Yang.

The realisation that the league may have overestimated its pulling power seems to be dawning on some at the broadcaster and it has sought the help of Sven-Göran Eriksson to get their message across. “Even if you live in England and want to see matches on television you have to pay for it,” he told fans in a web video address.

“It’s beyond myopic,” says Mark Thompson of Shanghai-based sports consultancy S2M Group. “You could just about argue the Premier League’s Game 39 plan has some foresight, but it has no consistency with their TV plan – they’ve reduced their presence on Chinese TV, yet want to bring a match over here? It doesn’t make any sense.” Thompson, whose company’s clients include Adidas and Chinese computer giant Lenovo (an Olympic sponsor), adds: “You’ve got to wonder if anyone sat down and thought about what their ten-year plan in China was.”

The Premier League has long been competing with La Liga, Serie A and the Bundesliga here – and they are all still free to air and growing in popularity. But the biggest threat comes from American basketball. “Their major competitor for sports advertising in China is the NBA. Fundamental to any advertising spend is TV. The key to any business strategy for China is getting your TV platform and the Premier League have failed to do that,” says Thompson. It helps, of course, that one of the NBA’s biggest stars, figuratively and literally, is the Shanghai-born Yao Ming, who has played in the league’s All-Star match six times and, a foot injury permitting, will appear for his country in the Olympics. He would be eclipsing Sun Jihai regardless, but all the more so now that the latter’s audience has so drastically shrunk.

From WSC 254 April 2008

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