BERLIN — Just weeks after News Corp. took a significant stake in Premiere, the German paybox has gone on the offensive by taking aim at Leo Kirch, who controls Bundesliga soccer broadcasting rights, and his plan to produce and sell ready-to-air Bundesliga coverage.
Flexing its new-found muscle, the feevee platform launched its first legal salvo at Kirch by filing a complaint with Germany’s cartel office charging that the plan by Kirch and the German Football League to offer bundled Bundesliga programming was anti-competitive.
Last year, the German Football League agreed to give the Bundesliga rights to Kirch’s company Sirius SportMedia in return for a guaranteed Euros 3 billion ($4.3 billion) income over six years, beginning in 2009.
Part of the deal included plans to put ready-to-air programs on offer in order to also attract bids from smaller pay TV platforms that are unable to produce their own sports coverage.
Carsten Schmidt, Premiere’s head of sports and new business, has said the paybox only wants to buy the broadcasting rights and has warned that it would refuse produced and packaged coverage, adding that Premiere had a responsibility to its subscribers to provide independent sports coverage.
Premiere relies on soccer to boost subscriber numbers (currently totaling 3.7 million, or about 9% of German TV households) and uncertainty about its obtaining the Bundesliga has shaken investor confidence in the platform in recent months.
Murdoch became Premiere’s biggest shareholder earlier this month after News Corp. picked up a 15% stake in the paybox platform from regional cabler Unitymedia for Euros 287 million ($422.4 million).
Meanwhile, Kirch may be feeling additional pressure from the German Football League, whose deal with the media mogul is contingent on a bank guarantee for the $4.3 billion promised by Kirch.
While Kirch had been in negotiations with Germany’s Commerzbank to secure the guarantee, those talks ended last week, according to daily newspaper Sueddeutsche Zeitung, after it came to light that Kirch had appointed Ulrich Blessing as managing director of Sirius. Blessing, it turns out, is the brother of Commerzbank topper Martin Blessing -– a fact that may have proved an embarrassing conflict of interest for the bank.
However, Sirius is working on an alternative plan to secure the guarantee, the Sueddeutsche Zeitung reported, citing unnamed sources.