Leo Kirch soccer plan punctured

Antitrust watchdog rules against media mogul

The German antitrust watchdog has torpedoed a E3 billion ($4.7 billion) deal between the German Football League (DFL) and media mogul Leo Kirch to produce and market top league Bundesliga soccer.

The Federal Cartel Office’s opposition had become increasingly evident in recent weeks, and on Thursday, the watchdog came down squarely on the side of fans and TV viewers by threatening to squash efforts by the league and Kirch to corner the market.

The Cartel Office has not formally killed the deal, however. It has suggested the DFL alter its plans to win regulatory approval – but observers say the DFL is unlikely to do so.

The DFL wanted to offer pay TV greater exclusivity by stripping pubcaster ARD of its early evening weekend game wrap-up show in order to force more fans into becoming feevee subscribers – a key part of the plan.

Cartel Office prexy Bernhard Heitzer said the DFL’s strategy offered no advantage to consumers. He added that the watchdog could only greenlight the deal if consumers actually benefited from it.

As long as ARD retains the right to air its early evening wrap-up show, however, it would make little financial sense for the DFL and Kirch to go through with a revised plan.

Last year Kirch’s Sirius SportMedia inked a $4.7 billion deal with the league to market Bundesliga broadcast rights as well as produce and sell ready-to-air Bundesliga programs from 2009 to 2015, guaranteeing some $785 million per season; the league currently makes some $660 million per season.

Pay TV platform Premiere currently controls Bundesliga rights, but the new plan called for the inhouse-produced game coverage to be more widely distributed, allowing smaller feevee services the opportunity to buy Bundesliga matches.

The watchdog’s decision is good news for Premiere, which remains the only viable pay TV player that can afford feevee rights.

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