Telecinco Set to Sign USD100m Deal for Euro ’12 Rights

According to media reports, Spanish commercial broadcaster Telecinco, owned by Italian media group Mediaset, is set to acquire the broadcast rights for UEFA’s Euro 2012 tournament in a deal worth Eur70m (US$100m).

UEFA’s asking price of Eur75m ($107.3m), the same fee paid by Prisa-owned pay-television operator Sogecable for the Euro 2008 rights, will therefore not be met due to a lack of competition in the Spanish market. It is understood that Telecinco will also pay an additional Eur2m ($2.86m) for the Under-21 Euro 2011 that takes place in June.

Restrictions on Telecinco’s only real competitor, public-service broadcaster TVE’s rights budget and the recent acquisition of UEFA Champions League rights for the next three-year cycle, from 2012-13 to 2014-15, forced its withdrawal from the bidding process.

Telecinco could sub-license a package of rights to Prisa-controlled pay-television operator Digital Plus, in which it has a stake.

Analysts at Citi Bank said of the deal: “This event is likely to help the audience share of Telecinco and Cuatro during the tournament, but these large sporting events are rarely profitable, and therefore, if anything, we believe it could put downwards pressure on 2012 forecasts.” The deal is only the second in Europe’s top five markets. In Germany, the only other big five market where a deal has been concluded, UEFA also had to accept a slight decrease in rights fee when renewing with state broadcasters ARD and ZDF.