Ian Plenderleith looks at the wobble of football websites

There was more worrying financial news for Football League clubs in March when its internet partner Premium TV (PTV) announced another wave of redundancies and sent its CEO home on “gardening leave”. Yet the com­pany claims that it is not on the verge of collapsing, despite the lay-offs, the huge debts at its parent company, NTL, and the fact that it has already once had to renegotiate its contract with the FL.

Parallels have inevitably been drawn be­tween PTV and ITV Digital, although the am­ounts involved are much smaller. PTV originally agreed a £65 million deal with the clubs, with £30 million paid up front and the rest due in regular rights payments over 15 years. How­ever, last September this was restructured so that the outstanding money was only paid when the websites generated revenue, with the FL taking an 80 per cent share of the cash.

PTV’s incoming CEO Rod Henwood has said that there are “no formal parent guarantees” in its contract with the FL should PTV go bust. This means that NTL would not be legally obliged to fulfil the contract, just as ITV Digital’s parent companies Carlton and Gra­nada escaped liability upon ITVD’s col­lapse last year.

The official websites raise revenue from online betting, but more importantly from sub­scribers to their multimedia “World” sec­tions, which offer features such as audio feeds of live matches from local BBC radio commentaries, as well as video goals and match high­lights not available on the free section of websites. So far World has attracted 36,000 subscribers that, according to PTV spokesman Will Robson, makes it “the largest global on­line football subscription service”.

Clearly, though, the potential is much greater as there are far more than 36,000 fans of the 80 clubs involved in the joint venture (PTV also runs some Premier League team sites). The offer of a week’s free trial of World in early March, and the extension of this offer beyond its initial expiry period, may have eith­er been a standard marketing move at a slack time of the year, or an indication that PTV is finding it hard to attract newcomers.

Some fans who have subscribed to World say it is simply not worth the money (typically between £24.99 and £34.99 per year, depending on the club). For example, the radio com­mentaries, often interrupted for “rebuffering”, are only worthwhile for fans living out­- side the area, while the video clips (through a 56k dial-up modem, at least) are viewed on a tiny rectangle in the middle of the screen and appear to have been recorded on a rain-soaked camera lens. And perhaps even the most de­voted fans aren’t that interested in watching a blurred, eight-minute clip of the youth coach ruminating on the Under 17s’ ­1-0 away win at Colchester.

PTV’s Robson, however, says that feedback from fans has been “overall very positive”. He also maintains that the redundancies, which have reduced staff numbers to 102 from more than 200 when the company was formed, are “to enhance the business over the longer term”. The firm may not be making money now but, like Rupert Murdoch when he first bought football broadcasting rights for Sky, it senses that today’s loss-maker will be tomorrow’s cash cow.

Mark Reeves, whose company ReevesMontgomery is developing an international marketing plan for Ajax, says that the problem in the UK is that not enough people have taken up broadband internet services, which will improve the quality of services like World. Ajax, meanwhile, are already offering fans the chance to watch occasional games live on pay-per-view through the internet at a cost of be­tween €1.50 and €2.50 per game, although the cost will increase next season when all games are slated for web broadcast.“Ten years from now, games narrowcasted via the internet will be indistinguishable in video quality from games broadcast by satellite today,” Reeves pre­dicts. “Cyberspace is where the battle to dominate foot­ball revenues will be fought.”

Whether all Football League clubs will be in a position to exploit this trend is another question. Not only are there fewer fans, they can be far more re­sistant to change, especially if they have to pay for it. As ITV Digital has already dis­covered, demand for low­­­er league football often stays firm­ly rooted to the terrace and the cold plas­tic seat.

From WSC 195 May 2003. What was happening this month

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