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caveman_nige
9th June, 2009, 01:47 PM
Setanta faces administration "within days" unless backers provide more funds to pay ?30m it owes to the English Premier League, reports have suggested.

The broadcaster has already failed to pay the Scottish Premier League ?3m it owes in television rights money.

Setanta, which also shows cricket, golf and rugby union, has about 1.2 million subscribers but is losing up to ?100m a year, analysts say.

Deloitte is set to step in to run the firm if it goes into administration.

Would-be customers who attempted to subscribe to Setanta through its website were on Tuesday told that it was not possible because of "routine maintenance". Meanwhile anybody trying to subscribe by phone receives a recorded message saying that "The service is temporarily out of order".

A spokesman for Setanta declined to comment on the firm's situation.

'Weaker' matches

The rights to show the English Premier League - and the subscribers that this pulls in - lie at the heart of Setanta's business model.

Setanta has too few of the "big" Premier League games, say observers

But the firm had only about 60% of the subscribers it needed to break even, said Professor Chris Brady of the BPP Business School.

"They have predicated the whole thing on getting those subscribers. The problem is they are taking on Goliath in BSkyB," he told the BBC.

Not only did Setanta have only a small percentage of televised Premier League games but they tended to be "weaker" matches, he added.

There had also been problems with customer service, Professor Brady told the BBC.

Setanta's viability was cast into doubt earlier this year when it lost the rights to show 46 live Premier League matches from 2010/2011.

In future, it will show only 23 games per season, compared with BSkyB's 115, with industry observers saying that thousands of customers would give up their subscriptions.

Falling values?

It is expected that a rival broadcaster - perhaps ESPN - would buy up its Premier League football rights.

But the worsening economy has led observers to suggest that the rights to 46 games that Setanta holds for next season, the final year of its current contract, would not be worth as much as they had been.

There are also doubts about whether the Premier League could match the ?159m Setanta paid for the right to screen 23 Premier League games each season from 2010-11.

A shared deal with ITV saw them secure rights for England and FA Cup matches for ?425m - and it is likely another firm would buy up these rights.

One SPL club has told BBC Scotland that income from Setanta alone accounts for 33% of their income, while another said it was 20% for his club.

"With cuts already being made for next season, the loss of revenue of 20% would undoubtedly have a knock-on effect on and off the pitch," said one a source.

It is feared that the loss of cash from Setanta could force as many as three SPL clubs into administration.

Source: BBC NEWS | Business | Setanta 'is on brink of collapse' (http://news.bbc.co.uk/2/hi/business/8090633.stm)

caveman_nige
9th June, 2009, 01:54 PM
Two decades ago sports broadcaster Setanta started life in an Irish dance hall in west London, showing the Republic of Ireland's 1990 World Cup game against Holland after the BBC and ITV declined to broadcast the game in the UK.

It cost just ?10 admission to watch that game in Ealing's Top Hat club and Setanta's two Irish founders, Michael O'Rourke and Leonard Ryan, managed to break even after 1,000 Irish fans turned up to watch the game.

Nineteen years later, Setanta was a company transformed. It had expanded gradually at first, and then grown in a spurt from 2004 onwards - which saw it acquire major sporting rights not only for football tournaments, but golf, horse racing, rugby union, cricket and boxing.

Along the way it changed itself from a niche broadcaster providing Irish and Gaelic sport to an expatriate audience, complete with homely Dublin guesthouse advertisements, to a rival for Sky whenever major sports rights came up for grabs.

Unfortunately for Setanta the financial sums involved had changed greatly too.

'Major breakthrough'

Since the turn of the year, Setanta - which has 1.2 million customers rather than the 1.9 million it needs to break even - had been desperately trying to raise new capital in order to meet payments for sports rights.

No sooner would it make one payment, for example to the Football Association, then money would be owed to other rights holders, such as the ?3m owed to the Scottish Premier League, or the more than ?30m to the English Premier League.

With the pressure of payments increasing, there are reports that the firm is on the brink of administration.

Setanta signed its first Premier League deal in Scotland in 2004


If Setanta does collapse, its broadcasting rights, such as those owned by the Premier League, will revert to the holders, who will then try to find buyers for their broadcasting packages.

James Pickles, editor of industry journal TV Sports Markets, says: "Setanta was initially able to build a very successful niche business across the world by providing one-off coverage of Irish and Gaelic sporting events to expat audiences.

"Gradually they built it up to the point where it was a worldwide operation with a number of different TV channels, such as Setanta North America, offering a number of different sports, often tailored to each individual market.

"A major breakthrough from expatriate broadcasting to major UK rights came when they won the Scottish Premier League football for the first time in 2004.

"But the big step up was in 2006 when they picked up the two English Premier League packages."

Golf deal

That coup gave them the right to show 46 matches annually for three seasons from 2007/08 to 2009/10.

In some ways it was handed to them after the European Commission ruled that, for competition reasons, one broadcaster could not own all the six domestic Premier League rights packages.

That decision brought an end to Sky's monopoly and allowed Setanta in.

"That seemed to cool the doubts that some people had about the business, and it started gaining them a bigger audience," says Mr Pickles.

That was followed by the deal with PGA golf, which secured coverage - for six years from 2007 - of 40 top golf events annually in the US.

Once again Setanta broke the Sky monopoly, and grabbed the exclusive UK and Republic of Ireland rights to the premier US golf professionals competition

"That was their second big move," says Mr Pickles. "People said it was very clever as it gave Setanta lots of content, and enabled them to actually set up their golf channel.

"At that point it all appeared to be moving forward for them.

"However, in a way it was not long after that golf deal that their problems started."

No buyers

After securing the Premier League rights, Setanta received in excess of ?400m in private equity funding.

But the private investors wanted to see a return on their money, and soon started to look around for a profitable sale.

"Private equity investors are are looking for a three-to-five year window of investment at most," says Mr Pickles.

"But for a pay-TV channel you need a longer period than that to get established. It is very hard to launch a pay-TV channel and then consolidate, particularly when you have someone like Sky who is so dominant.
Winning US PGA golf rights was seen as a good move by Setanta


"At the start of 2008 - after the surge in interest and customers brought about by Setanta's two Premier League packages - there was talk of the firm being up for sale for ?1bn, which was judged to be too much."

Potential investors would have seen that there were only two years left on their Premier League deal, and there was no guarantee Setanta would win again when the rights came up for renewal.

"This was their difficulty - when TV deals are sold in three-year cycles it is hard to show that you have an established and long-term portfolio of rights for investors," says Mr Pickles.

Despite reported interest from Disney sports channel ESPN there were no takers, and doubts were being expressed about some of Setanta's deals.

FA Cup magic?

For example, the year before, in 2007, Setanta had signed a deal with the Football Association to show FA Cup matches and England home friendly matches.

From 2008 to 2012 it would show 25 FA Cup matches a year and eight England friendlies across the contract.

"I don't think that was such a great deal for Setanta," says Mr Pickles. "You might only get two or three big FA Cup matches a year, and you have to wonder how many people are going to pay to watch an England friendly match."
Setanta lost one of its two 23 game packages for the 2010 to 2013 period


In 2007 Setanta had also launched a sports news channel in competition with Sky's offering. That ate up millions in capital.

The company did do a good deal, according to Mr Pickles, in winning exclusive rights to England's away World Cup qualifiers, but they then suffered a public relations disaster in a row over selling the highlights to such games to terrestrial broadcasters such as ITV and the BBC.

Setanta could not agree a deal to sell on the highlights to ITV or the BBC.

Many fans were angry they were unable to watch highlights of the games on an analogue channel and blamed Setanta - which said it had not received a financially acceptable offer.

In the meantime the recession was starting to bite and people were thinking twice about sports pay-TV, particularly if they already subscribed to Sky.

'Questions raised'

A massive blow came in February this year when Setanta failed to retain the rights to their two packages of English Premier League rights for the 2010 to 2013 period, winning only one tranche of 23 games.

"That really raised questions about the viability of their business model," says Mr Pickles.

"They went into those negotiations with about 1.5 million customers, and would have been looking to expand their Premier League audience.

"But it seems the private equity partners said they were going to see if they could bid less and get away with it. They didn't, and Sky got the fifth package."

If Setanta does collapse there will be a scramble to acquire its many rights, with ESPN seemingly poised to finally make inroads to the UK football broadcasting market.

ste6106
10th June, 2009, 12:44 PM
Sky have refuse to help them too

BBC NEWS | Business | BSkyB rejects Setanta rescue deal (http://news.bbc.co.uk/1/hi/business/8092595.stm)

alunfennell
10th June, 2009, 02:24 PM
Of course there are not going to help ! Its not the first time a Tv company like Setanta have been in direct competition with Sky buying up football rights, OnDigital in the past thought they could do the same.

There is a reason why Sky dont broadcast live Saturday Afternoon Games and a limited Sunday afternoon fixtures (The broadcasting right are too much in relation to there subscriptions of customer to Sky Sports) for ten years Sky have broadcast Sports Saturday instead of live Games other Tv companys like Setanta & On-Digital have bought there way into broadcasting Live Games both have ended up having problems with payment and have gone Bankrupt...

Overseas broadcasters get live Premiership & SPL on a Saturdays & Sundays because its not there Domestic leagues thus getting it far cheaper than a Nation provider in Britian or Ireland.

What is sad is that the likes of Premiere in Germany have nearly all there domestic football live on Premiere Sports Portal every weekend, But it remains to be seen with the intervention of Skys Rupert Murdoch moving in on Premiere will the price of broadcasting bundesliga rise enough to the extent of the premiership where nobody can afford to broadcast Live Games...

Finally this is the price we pay for having the biggest and best league in the world, with footballstars, clubs, Managers getting 10s of millions every year much of which comes from Tv broadcasting, Fans coming through the tunstiles and the shirts on you back, the days are getting numbered for for the prmiership (like in F1 ) if the spending is not brought under control.

Regards:
Alun

caveman_nige
12th June, 2009, 12:27 AM
The Walt Disney-owned sports network, ESPN, says it does not have any plans at present to buy beleaguered Irish broadcaster Setanta.
It comes after speculation ESPN, which lost out on English Premier League TV rights this year, may make a bid.
The board of Setanta, which has halted taking new subscriptions, has spent the week in emergency refinancing talks to try and stave off administration.
"We currently have no plans to buy Setanta," an ESPN spokesman said.
He added: "There are a lot of stories out there that link ESPN with a possible purchase. We wanted to set the record straight."

http://newsimg.bbc.co.uk/shared/img/o.gif SETANTA'S SPORTS
Premier League
Scottish Premier League
Blue Square Premier
IPL cricket
US PGA Tour golf
Boxing

ESPN had bid to win a slice of the forthcoming English Premier League TV deal, which will run from 2010 to 2013.
However, when the deal was announced in February, Sky had won five of the packages and Setanta one.
ESPN would not say whether it would be interested in acquiring Setanta's rights, and their spokesman said it was a hypothetical situation and a question for Setanta and the rights holder.
On Wednesday Setanta confirmed it had stopped taking on new customers as it "attempts to secure the future of the business".
Setanta has been holding emergency meetings this week to discuss survival plans.

source: BBC NEWS | Business | ESPN: 'No current Setanta plans' (http://news.bbc.co.uk/1/hi/business/8094690.stm)

caveman_nige
12th June, 2009, 12:32 AM
Beleaguered Irish broadcaster Setanta has confirmed it has stopped taking on new customers as it "attempts to secure the future of the business".
In a message to customers on its website, the firm stressed it was not in administration and that it was broadcasting all channels as usual.
Setanta has been holding emergency meetings to discuss survival plans.
There are conflicting reports from sources close to the company over the firm's future should it collapse.
"As has been widely reported in various media channels, the management of Setanta Sports management is in the process of attempting to secure the future of the business," the broadcaster said.
"In the current circumstances, we have decided to suspend temporarily the acceptance of new subscriptions."
It urged customers not to cancel direct debits or recurring payments on credit cards, saying their contracts with the broadcaster still applied, and the service was still available,
Meanwhile BT Vision said that while Setanta was still available in its packages and as a stand-alone channel, it was no longer advertising the service.
Rights opportunity
Setanta's founders Leonard Ryan and Michael O'Rourke are in talks with backers to secure financing to keep the firm going, according to some reports.
http://newsimg.bbc.co.uk/shared/img/o.gif

Meanwhile US sports broadcaster ESPN is also said to be interested in either buying the Irish firm for a nominal sum or simply bidding for its rights to English Premier League matches.
ESPN, which has been expanding in Europe, has remained quiet over its investment strategy.
But it missed out on acquiring the rights to English football's top league when they were auctioned earlier this year.
Sky request fails
It has emerged that rival broadcaster BSkyB refused a ?50m lifeline to Setanta.
Setanta had offered access to its live rights for 46 English Premier League games next season as an add-on option to Sky Sports, in return for the cash.
BSkyB's chief executive, Jeremy Darroch, said that his firm had been "talking to Setanta, and trying to work with them and help them", but that it could not agree to the proposal.
"At the end of the day, we are not a bank, we are a broadcaster, not a supplier of working capital to a business and rights holder," he said.
"Our job is not to fund other companies. This is a huge amount of money."
Subscriber shortfall
Setanta, which shows cricket, golf and rugby union as well as football, has about 1.2 million subscribers.
But this is only about 60% of the number it needs, according to analysts, and the company is losing up to ?100m a year.
Setanta needs to pay ?30m that is due to the English Premier League and has already failed to pay the Scottish Premier League ?3m it owes in television rights money.
Analysts widely expect that anybody picking up Setanta's sporting television rights would pay less than the amount paid originally.
EU restrictions
Under the current UK broadcast deal for the English Premier League, which lasts for one more season, BSkyB holds four packages of rights to show live matches next season - a total of 92 games - while Setanta has the other two packages - which cover 46 games.
Under European Union competition rules, BSkyB could not hold all of the rights packages.
However, Setanta could act as a wholesaler - retaining the rights, but then selling on the football coverage, which rivals would show through their channels.
Some analysts say that this business model is the only way that Setanta can survive, rather than selling its coverage directly to customers.
It already does this for Virgin Media, which makes Setanta channels available as part of its more expensive packages.
Setanta would probably receive less revenue this way than by selling directly but it would potentially be able to reach a wider market, thanks to the marketing power of the likes of BSkyB.
This business model would also allow Setanta save money, as it would not need marketing or customer services teams.


source: BBC NEWS | Business | Setanta halts new subscriptions (http://news.bbc.co.uk/1/hi/business/8092595.stm)

caveman_nige
12th June, 2009, 07:19 PM
US tycoon Len Blavatnik has tabled a proposed rescue deal for pay-television firm Setanta, it has been confirmed.
The ?20 million offer for 51% of Setanta is aimed at securing the future of the cash-strapped Irish broadcaster by helping it avoid administration.
The Irish-based broadcaster has around 1.2 million subscribers, but that is short of the reported 1.9 million it needs to break even.
Setanta's potential white knight founded Access Industries, a privately owned industrial group, in 1986. It also has interests in Top-up TV, which is Freeview's pay TV service, Israeli television's Sport 5 and online sports provider Perform Group.
Access currently has a holding of less than 5% in Setanta.
A statement from the firm said: "Access Industries can confirm that this morning it submitted a proposal to the board of Setanta to acquire a majority interest in Setanta, refinancing the company.
"The Access proposal is subject to a number of pre-conditions being met.
"Access believes that this proposal would secure the future of the broadcaster for customers, football and employees."
The spokesman said he was unable to disclose the terms of the proposal.
Setanta has TV rights including the FA Cup, World Cup qualifiers, Premier League, Scottish Premier League, and the Blue Square Conference - but is struggling to pay for them as customer numbers have dwindled in the recession.

alunfennell
13th June, 2009, 12:43 AM
A far cry from 1.3 billion the company was worth back in 2006 Setanta had even hired JPMorgan to advise it on a private fundraising to help it to pay for the rights acquired, How fast every thing went wrong for Michael O’Rourke and Leonard Ryan who have made personaly over 350 million each, I wonder how much they have put themselves on the table to keep Setanta alive...

50million is very little as Setanta have to pay 30 million just to pay outstanding debts to Spl Epl and conferance clubs before they even get started... whens the next bill due ?

I give them to Christmas if they take the 50 Million from Len Blavatnik then he will surly buy or dump the rest for his own gains....Bye Bye Setanta

Regards:
Alun

caveman_nige
15th June, 2009, 05:18 PM
The English Premier League has told Setanta if it does not pay the reported ?30m it owes by Friday, 19 June, it will lose its games for next season.

The league has threatened to sell the rights to the 46 live matches Setanta is supposed to be showing in the 2009/2010 season to the highest bidder.

Setanta has been struggling to make its payments to the sporting bodies from which it buys television rights.

However, Setanta reopened its website to new subscribers on Monday.

'Securing future'

In a statement on its website Setanta said: "All of our channels are still broadcasting across all platforms and our subscribers can continue to enjoy our programming.

"We are taking subscriptions from new customers... both online at Setanta Sports, Sports News, Sports on TV, Football, FA Cup, Boxing, UFC, Cricket, Rugby. (http://www.setanta.com) and at our call centres."

It added: "As has been widely reported in various media channels, Setanta Sports and investors are in the process of securing the future of the business."

Setanta has around 1.2 million subscribers, but that is short of the estimation of industry analysts, who say it needs 1.9 million to break even.

Investor interest

Setanta suspended new subscriptions on Wednesday, 10 June, as it looked to raise new capital.

On Friday, Access Industries, controlled by the US investor Len Blavatnik, tabled a ?20m bid for a 51% share in Setanta.

He and other investors are now carrying out intense "due diligence" - examination of Setanta's books - which should be completed by 19 June.

And over the weekend it emerged that Dutch media firm Endemol was believed to be interested in taking a stake of up to 49% in the company, along with other investors.

'Shortage of time'

Deloitte has been lined up as administrator if Setanta's efforts fail.

The Premier League said it had invited bids for the 46 live matches with Setanta's agreement.

"In view of the shortage of time before the start of next season, the Premier League has determined, with the agreement of Setanta, that it shall today issue its invitation to tender in respect of the 46 UK live matches for the 2009/10 season only," the league said in a statement.

"The bid deadline has been set for Monday, 22 June, but we will give all prospective bidders notice late on Friday, 19 June, if Setanta have met their conditions, thereby negating the need for bids to be submitted."

The Irish broadcaster's predicament is also affecting the Scottish Premier League after it defaulted on a payment of ?3m for part of last season's coverage fees.

With some SPL clubs revealing they depend on television money for up to one third of their annual budget, chairmen have voiced serious concerns for the future of the game in Scotland.


Source: BBC NEWS | Business | Premier League's Setanta deadline (http://news.bbc.co.uk/2/hi/business/8100858.stm)

telboy
15th June, 2009, 05:39 PM
ALL National (ie England, Scotland, Wales, N. Ireland) football matches should be shown on FTA channels with no exeptions!!!!