La Liga President Javier Tebas on Growth: Domestic, International and OTT

Tebas is driving to make La Liga much more than just Real Madrid and Barcelona

MADRID — On March 5, Spain’s top soccer division, La Liga, along with Amazon Prime Video and Mediapro, Southern Europe’s largest independent TV content creator, announced a new docu-series focused on the league, “Six Dreams.” Sat between representatives from the two media giants, both of whom are likely candidates to bid in upcoming TV rights auctions for La Liga, was league president Javier Tebas.

A playmaker in Europe’s soccer business, and giant of a man in status if not in stature, Tebas was elected to his position in 2013. He stepped into the position while the league was mired in match-fixing scandals and increasingly frequent instances of fan violence. Tebas’ first initiative was to clean up the game, something even his detractors would have to admit he has advanced. Another focus is on growing La Liga as an entertainment industry, and providing a truly singular viewing experience to fans around the world. His goal is to make Spanish soccer about much more than just Real Madrid and Barcelona, the two teams that dominate revenues and often the league.

And, although he publicly and proudly admits he is Real Madrid fan, Tebas’ allegiance to his favorite team is clearly subordinate to his professional motivations to boost a league which boasts seven (eight counting Neymar who moved from Barcelona to Paris St. Germain in August,)  of the world’s top 11 players as ranked by FIFA, but is still considered by many, especially in Asia, to be secondary to the English Premier League (EPL).

While La Liga and its British counterpart are often compared in terms of the product on the field, there are valuable comparisons to be made in their TV markets as well.

“The UK has much higher pay TV penetration: 60% at the end of 2017, compared to 33% in Italy and 32% in Spain. This obviously gives pay TV operators in the U.K. a much stronger revenue base to make expensive bids for content,” said IHS Markit analyst Tim Wescott.

Tebas sees a silver lining however, asking: “Can the Spanish League equal the EPL in pay TV subscribers? No. Do we have a margin for growth? Yes.”

As pay TV subscriptions grow in Spain, so too should fees the League collects for TV rights. Tebas previously said that he hoped to secure €1.3 billion ($1.61 billion) annually for the domestic rights to the 2019-20, 2020-21 and 2021-22 seasons, compared with €1.1 billion ($1.36 billion) under the current contract.

There are more challenges than just TV subscribers however.

“In England there has been a very strong competition (between broadcasters),” said Tebas, “In Spain, the competition is much more limited, because Telefonica have a major market share compared to two smaller competitors, Vodafone and Orange.”

While what he says is true, Wescott pointed out that there are really only two major players in the domestic rights game in the U.K., “BT is making a sustained bid to build a pay TV business, which has inflated the cost of rights as Sky wants to maintain its market leadership. BT is now the only challenger to Sky which has stayed in the running longer than two PL contract cycles. Everybody else pulled out or went bust.”

Telefonica’s Movistar+ holds Spanish domestic La Liga rights through the 2019-20 season, which they purchased in 2015 for €600 million ($666 million). But with a new auction of La Liga rights upcoming, Sergio Oslé, the new head of film and TV at Spain’s Telefonica, expressed caveats about their value: “Soccer is attractive and interests us, but not at any price.”

Another potential growth front is Asia. Before 2015, La Liga teams sold their international TV rights individually. That is startling when when compared to the EPL, which has been selling international rights collectively since 1992. This means that while Real Madrid and Barcelona still bring home the jamón for La Liga, England has had decades to grow the profiles of clubs other than Manchester United and Liverpool.

“The EPL has a brand. The La Liga brand had never been pushed in those markets,” explained Tebas, “There have been two great clubs in Spain that have marked the majority of the competition. The EPL has shown that a great brand can grow smaller clubs.”

This has proved especially damaging in the rapidly expanding Asian markets, where the EPL has thus far made better headway in a territory in which domestic leagues aren’t well established, and offer little resistance to high-quality foreign soccer.

As any soccer fan in American knows, midday games in Europe make for early mornings in the west. The opposite problem affects Asian viewers, and to that end, Tebas’ regime has added new, earlier times slots for matches.

“When we arrived four years ago, there were no games scheduled for the Asian live market,” Tebas said, “Last year we restructured all the schedules, and now there are between five and seven games each week in decent hours to watch in Asia.”

La Liga has also opened offices in Peking, Shanghai, Singapore, New Delhi, and Dubai, and has delegates living in Japan, Korea, Indonesia, Vietnam.

It’s clear where Tebas is presently focusing the bulk of the league’s energies: “First, improve the product,” he said. “How the games look, stadium standards, production decision are all left up to the Liga now. If you improve product, you improve the brand.”

Tebas believes that a viewer needs to be able to identify a La Liga game within three minutes of turning it on, solely from the camera angles and the technology used, and that must be the case regardless of which teams are playing. To that end, La Liga has already installed spider cams in many stadiums, added new stationary camera angles, and implemented Intel’s 360° replay technology which lets viewers get a first person view of what players are seeing on the field.

It’s important to Tebas that the way football is viewed evolves parallel to the way other premium content is consumed. He pointed out that 14 million Spanish homes, nearly the entire country, have high-speed broadband internet, and that the prospect of delivering matches via an OTT platform is an alluring idea. But they would need help.

“Theoretically TV can arrive via OTT,” he said. “In that, Movistar and its immense customer network would be key. They know how people watch football, when and where.” He did clarify however, that any OTT offering could still be years away.

And, while Movistar is far and away Spain’s largest TV and broadband provider, Tebas was unflinching on a future deal with the telecom giants, “In Spain we (La Liga) have a premium product, and Movistar is key to getting it everywhere, But if they do not buy football, we’ll find someone else.”

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