The Premier League has been told it would need more than 12m UK subscribers paying £20 a month to justify launching its own streaming service, dubbed “Premflix”.
English football’s top division generates around £3.5bn a year from selling its media rights, with around half of that coming from its UK deals with Sky and TNT Sports.
A direct-to-consumer (D2C) streaming service owned and operated by the Premier League would offer the chance to increase that but would come with considerable cost and risk.
“When you just do the simple maths it’s pretty straightforward,” said Sky’s group chief operating officer Nick Herm.
“The amount of money that the Premier League earns in the UK, if they went direct-to-consumer they’d have to sell 12m-plus subscriptions at £20 a month to recover that money.
“Because it’s not just the revenue you’re recovering; it’s the costs of running that service. Running a streaming service is not free – you’ve got to cover 30 per cent of your revenue for streaming costs, marketing, all of that.
“Suddenly, as a rights holder, that feels hard. You’re having to do it better than incumbents who’ve done it for a long time and you’re going on a big J curve.”
Rumours that the Premier League might be considering a D2C platform gathered pace last year when it announced it was bringing all overseas content and production in-house from 2026.
But the upfront costs of launching a Premflix service could hit revenue in the short term and therefore prove unpopular with clubs uncertain of their top-flight future, Herm said.
“If you’re a club and the Premier League says ‘sorry, your rights fees next year are going to be zero because we’re investing in this big thing but don’t worry, the year after they’ll be great’, there’s at least a dozen clubs in any year that think they might get relegated, so there’s all these mixtures of incentives,” he added at the FT Business of Football Summit.
Ligue 1 streaming service ‘a sign of weakness’
France’s Ligue 1 launched a D2C platform in the UK last year after failing to sell the rights – “a sign of weakness”, according to media commentator Claire Enders of Enders Analysis.
The anticipated expansion of Big Tech in the sports rights space has not materialised, despite sweetheart deals, because they realised they do not need the content.
“Fairy godmothers don’t always show up. The tech companies have not shown up and it’s for a very good reason. The models are very difficult and painful and it takes years to build them up,” said Enders.
“Amazon has no necessity to have football to have a roaring ecommerce business worth £64.5bn in the UK. As we know, the leagues have tried to encourage the richest company in the world by offering these rights for practically nothing – peanuts – which I found completely incredible. This is the fattest fairy godmother on earth and they get it almost for free.
“The Premier League is right to have many partners. They [Amazon] are not going to take Sky’s place because they can’t, nor do they have the necessity to. Amazon don’t need content at all to get people on Prime.”