Wednesday, 24 June 2009
Setanta - A Real Mess
Fellow Blogger The Big dollop has a post on this. However I had a further dig.
Two decades ago sports broadcaster Setanta started life in an Irish dance hall in west London, showing the Republic of Ireland's 1990 World Cup game against Holland after the BBC and ITV declined to broadcast the game in the UK.
It cost just £10 admission to watch that game in Ealing's Top Hat club and Setanta's two Irish founders, Michael O'Rourke and Leonard Ryan, managed to break even after 1,000 Irish fans turned up to watch the game.
Nineteen years later, Setanta was a company transformed. It had expanded gradually at first, and then grown in a spurt from 2004 onwards - which saw it acquire major sporting rights not only for football tournaments, but golf, horse racing, rugby union, cricket and boxing.
Unfortunately for Setanta the financial sums involved had changed greatly too.
Since the turn of the year, Setanta - which has 1.2 million customers rather than the 1.9 million it needs to break even - had been desperately trying to raise new capital in order to meet payments for sports rights.
A major breakthrough from expatriate broadcasting to major UK rights came when they won the Scottish Premier League football for the first time in 2004.
But the big step up was in 2006 when they picked up the two English Premier League packages."
A massive blow came in February this year when Setanta failed to retain the rights to their two packages of English Premier League rights for the 2010 to 2013 period, winning only one tranche of 23 games.
They went into those negotiations with about 1.5 million customers, and would have been looking to expand their Premier League audience.
But it seems the private equity partners said they were going to see if they could bid less and get away with it. They didn't, and Sky got the fifth package.
However the knock on effects are just as big.
The demise of Setanta like all businesses means the sub suppliers and ssupport agencies also suffer far outnumbering the direct Setanta employees.
1000 people in Kirkcaldy about to loose their jobs.
Yes the credit crunch " which incidentally started in USA " claims another set of victims..........?
Or was the whole idea that Setanta thought it had actually a weak one.
Maybe they should secure the rights and sell them on.
Is that not exactly what ESPN do????
Basically be Mr 10%.
They had the rights also to distribute SuperLeague, Mageners League and Celtic League rugby in the USA.
You want to compete against Murdochs empire............you wont win.
I personally want ESPN to take over the SPL rights. They have the might of the Disney corporation behind them. That is the kind of clout needed.
Opening SPL and other European sports out to the USA cant be bad.........that one emerging market waiting to be tapped.