Is it worth 8 billion yuan to acquire the CSL rights?

Ti’ao Power, a Beijing-based company specializing in sports events broadcast, has won TV broadcast rights to the Chinese Super League (CSL) for the next five years. According to news last week, the company will spend a record 8 billion yuan (1.25 billion US dollars) over five years (2016-2020) for the broadcasting and producing rights of the Chinese top football league. 

The incredible figure is much higher than expected and nearly 20-fold increase on its current broadcast price tag. The news immediately stirred a big noise across the whole sports field in China. Discussions around whether it is worth 8 million yuan to acquire the broadcasting rights to CSL spread widely. 

8 billion yuan, worthy or not? 

“I think it’s not likely to get the investment paid off through rights distribution to traditional TV channels and online operators. We need to consider the relationship between the investment and the real value of the deal,” said Jiang Heping, director of CCTV sports channel. 

However, others believed that it's just a beginning as China's sports industry is developing on a fast lane.

"Although the price is higher than we thought in the first place, it showed that CSL has gained recognition and respect from the market," said Huang Yan, general manager of CSL soccer team Liaoning Hongyun.

"I think the value of the league is underestimated in the past few years," said Ma Chengquan, the director of Chinese professional leagues.

"Some might doubt that there's a huge bubble in the price, but given the performances of the CSL teams and the whole league, the price won't be a burden in the future.

"Ti'ao is a longtime partner with Chinese leagues and has majored in broadcasting of the sports events. They are professional and they look at it in a long run. They don't expect to make money in one or two years, they are looking to the next five years," added Ma.

Ma's ideas were echoed by Ti'ao's general manager Zhao Jun.

"I think it's worth it," said Zhao. "it's a long plan. The country is paying much attention to sports industry so the industry is definitely getting better and better. We believe it's profitable in future, especially in the soccer leagues."

Who will ultimately pay the bill? 

Jiao Shaobo from CCTV believed that sports audience in China will not pay the bill in current situation but the media instead. However, the traditional media like CCTV and BTV would probably do little to help Ti’ao in covering the 8 billion costs. And Ti’ao knows how much those traditional media could afford to pay the rights for CSL just by looking at figures they paid over the last few years. Mr. Jiao believed revenues from rights sales to online media will be the major profit source for Ti’ao Power. 

Source: Xinhua