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Top Premier League clubs want more money

The Premier League clubs remain divided over TV rights after the big six failed in an attempt to claim a greater share of overseas broadcasting money. They argue that viewers overseas tune in to watch the matches between the leading clubs. They say that the current method of allocating money is outdated as when the Premier League was formed overseas rights were virtually worthless. The clubs pushing for the change were the two Manchester clubs plus Arsenal, Liverpool, Chelsea and Spurs.

The original proposal was for 35 per cent of the overseas TV money to be split according to where clubs finish in the table instead of split equally, as is now the case. Such a move would have meant a potential £40m difference between the income of the top and bottom clubs in the division. There is a concern that giving more money to the bigger clubs would upset the competitive balance of the Premier League. It would make it less likely that a club like Leicester City could win the title and make it more difficult for clubs like Bournemouth, Burnley and Huddersfield Town to compete at the top level.

Earnings from overseas television rights are expected to grow faster than domestic rights. The Premier League has already tied up a deal with China until 2022 worth ten times the previous amount, and has doubled its money with similar deals in the United States, Brazil and sub Saharan Africa. When Premier League chairmen met this week they failed to vote on the matter as it was evident that far less than the required fourteen clubs were in favour of the change. It was agreed to meet again in three weeks’ time while the search for a compromise continues.

One possible compromise would be to put a cap on the total television income, domestic and overseas, so that the club finishing top of the table would never have a ratio higher than, say, 1.6 or 1.5 of the club finishing bottom. The method used this season, where there is a sliding scale for domestic television revenues, would mean a ratio of 1.59 to one.

Another possible compromise would be for only additional income secured from new overseas rights deals to be subject to a split according to where clubs finish in the table. The overseas deals that run until 2019 are worth about £1.2 billion a year but an increase to £1.6 billion a year in the 2019-22 period looks likely. Under this compromise only the additional £400m would be subject to the 35 per cent split and no club would earn less than they do at the moment. However, it might be seen as the thin end of the wedge by smaller clubs.

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