Confirmation that the Premier League has pulled the plug on Setanta comes as no great surprise. The company has failed to pay its monthly instalment payment to the league and a rescue package said to be worth £51m fell through this afternoon. Reports all over the media for the last couple of weeks or so have been saying that the Premier League has been playing “hardball” with the subscription channel, but the truth of the matter is that the Premier League doesn’t really want them there and would rather be in a position in which it could cosy up to Sky Sports with a complete and exclusive package.
EU competition law prevents Sky from owning all six of the live packages that Sky has to offer, and the current deal had four of the packages on the channel, with the other two on Setanta. When Setanta lost one of its to live packages from the start of the 2010/11 season earlier this year, it was a massive nail in the coffin of a channel that hasn’t turned a profit since it took the Premier League on in the first place. It now seems likely that the company’s only option will be to enter into adminsitration. Everyone will be a loser in this situation (whoever bids for the rights now will not be paying anything like what Setanta offered), but some will lose more than others.
The Premier League has the massive safety blanket of the massive payments from Sky, but the BSP, the FA and the SPL seem set for rocky waters, with concerns already growing that a Scottish equivalent of what happened to English Football League clubs when ITV Digital went to the wall in 2002 could be about to come true. It certainly seems likely that if or when Setanta goes to the wall once and for all (they’re likely to keep broadcasting for the next few weeks), the smaller clubs of the SPL, who have probably already spent the money promised by them. Indeed, Celtic and Rangers might have been facing a meltdown were it not for Champions League money.
What happens next, then? Well, there will be new bids for the two television packages that are now up for grabs for next season. Bids are due in by Monday. Sky will almost certainly take up one of these packages but are prevented from taking up the other one by law. ESPN could step in to fill the void with the other package. People hoping that PL matches might find themselves onto “free to air” channels are likely to be disappointed. The BBC hasn’t shown any interest in picking up live PL matches because of the prohibitive cost (which will still be prohibitive to them at a cut down price) and British commercial channels such as ITV and Channel 4 don’t seem to be in any fit state to be able to be able to bid competitively.
This is bad news all round. We discussed on here last week that a hole in the pockets to the tune of £100,000 for BSP clubs will leave many wondering how they will be able to continue paying the wages that they have been paying over the last few years or so. The FA, already strapped for cash because of the astronomical cost of Wembley Stadium, may have to sell FA Cup and England match rights at a cut down rate to try and recoup losses. Even Sky lose out. The current competition laws are so flimsy that some analysts have stated that they are in no small part to blame for what happened to Setanta. The failure of Setanta might just make the European Union look at even tighter reins on Sky than are currently in place. It promises to be a very long weekend for British football.