EPL rights set to reach dizzying new heights of unreality

Back of the net. As widely predicted, the reality distortion field has been switched on and the English Premier League has submitted its invitation to tender to the UK broadcasters. The regulator is watching, however, though whether it will just succeed in driving the prices up again when and if it acts is another question entirely.

What remains astonishing about the EPL is how much the prices of the rights have gone up since Sky first bid a headline-grabbing but now paltry-looking £302m for them in 1992. Very conveniently for those of us who like statistical synchronicity, the rights awarded to a joint BT/Sky bid two decades later went for almost exactly ten times as much, namely £3.018bn, and they are currently and confidently forecast to top that again this time as some deep-pocketed players weigh in at the table, with Al Jazeera — a late withdrawal in 2012 — chief among them.

For the record, £302m is £569m in today’s prices.

It has, of course by no means been a smooth curve of ascendency, with the regulator having a pronounced impact on pricing, almost always to the EPL’s benefit. Back in 2005 Gordon Brown, for it was he, was instrumental in getting the anti-monopolistic hounds of the EC to back off the EPL, the league promising to package its rights for sale to two broadcasters as a minimum as a result. That opened some very weighty floodgates, with the £1.25bn or 77% jump from £1.77bn to £3.018bn between 2009 and 2012 being particularly eye-watering as BT became the first of the disruptive telcos to enter the fray and knock ESPN out of the game as a result.

Cost of Sky’s all-in package in 1992 = £16.99
Cost of Sky’s 1992 all-in package in today’s prices = £31.82
Actual cost of all-singing, all-dancing Sky package in 2014 = £76.25

This time round the regulator’s hand can be seen in the inclusion of some Friday night games in one of the packages, a bid to head off Virgin’s complaint to Ofcom that the number of live games on offer is kept artificially low, and thus prices artificially high, thanks to the Saturday 3pm blackout.

All in all the live rights to 168 matches, 14 more than the current deal, split into seven packages are on the table, with no single buyer allowed to acquire more than 126 matches. There is also a near live long-form package containing 212 matches aimed at the on-demand market and an IP-based clips package for all matches. These will be sold in a second wave, with the main activity on the live matches expected to take four months and drag on to a decision in March.

And the cost? Deloitte has predicted a 14% hike in premium sports rights this year and the expectation is that will be happily blown apart and the rights might rise as high as £4.5bn; not quite the 77% of the 2009/2012 period, but at 67%, not too far off either.

Will Ofcom interfere? Will the BBC lose Match of the Day to an ITV aggressively chasing the highlights package? While it’s hardly comparing like with like — there are more matches, online to consider, etc etc — it’s an instructive exercise to wind back time and calculate how much Sky would have had to have paid for the rights in 1992 at today’s prices. The answer is a whopping £2.4bn. In other words, it’s highly doubtful if this whole careening bandwagon would have been unhitched and set off on its path at all if screening football cost as much then as it does today.

Why Sky investigating VR is good for VR

According to Broadcast, following its £400k investment in Silicon Valley start-up Jaunt last year Sky plans to conduct immersive VR trials on up to 15 shows next year to discover more about the technology’s potential. This is a profoundly good thing. Stereo 3D might have crashed and burned in the marketplace but Sky did it better than anyone and its pedigree for investigating new tech is pretty exemplary.

Of course, it also has a pronounced commercial edge, but it does seem to be able to pull off the neat trick of being able to explore new tech without the shackles of having to demonstrate value to license payers, for instance, while also doing it well. Arguably one of the reasons stereo 3D failed was because there was so much awful content out there. Indeed, we have it on good authority that most of the stereo 3D content provided by ESPN to Sky as the result of various contra deals between the to companies actually broke most of Sky’s QC rules and, to European eyes, was close to unusable.

European eyes, you say? Yes, it does seem that there was a powerful Atlantic rift between the US deployment of the technology and the European, with pronounced differences in the way that convergence was treated at the heart of it. Whether that was down to personal taste in the upper echelons or whether it was down to the dominance of the Cameron | Pace group’s kit in the US market and the way that that tended to work as opposed to the (arguably superior) 3Ality Technica driven Europe is a bit of a moot point. Either ways, it wasn’t very good.

Just because you can make Avatar doesn’t mean you can capture a baseball game.

So, it’s good to know that Sky is taking a point position on VR, another paradigm leap with a whole new visual lexicon and capturing a range of genres from sports to LE and drama to test out the way it works. So far it seems, the results have been mixed, with one of the keys to success from the viewer’s point of view apparently resting in having a lot to look at. Visually busy comedy Trollied = good, Arcticly bleak drama Fortitude = bad. Having to build 360º sets to accommodate all this = expensive.

One of the interesting things that is cropping up too is that the audience needs plenty of audio cues to direct their gaze. Once the director no longer has complete control of the viewer’s perspective  they can wander all over the place and techniques such as reveals have to be engineered in a much more finessed way: grab their attention in one direction, sneak in an actor behind them, yell boo! etc.

For our money, this is a technology that has nature docos written all over it. Sport?  That might prove to be a bit too quick in the end, which given the normal pay-TV business plan might cause some problems. It might well go on to find a niche in the adult, one-handed audience too. But all the arguments about viewers being reluctant to wear glasses were only rehearsals for the derision that will be heaped upon VR headsets, not to mention the attendant lawsuits when little Jonny trips over the cat. But, even despite all there caveats, it will be genuinely fascinating to watch the trials as they progress.