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October 12, 2011 / trajsingh

Tragedy of the Greedy Commons

I’m following the story today about Liverpool FC wanting a greater share of overseas TV rights.

Currently the Premier League splits this evenly across the 20 teams. LFC make the point that, abroad, nobody cares about Bolton (for example) but do care about Chelski, Ars*nal, ManUre and them – so they should get more. Especially since those nice Spanish clubs Real Madrid and Barcelona have an arrangement like this already.

But, La Liga is famously uncompetitive, and the Premier League is pretty similar. If the “Big Four” manage to get even further ahead through this additional revenue (ahead being relative, Liverpool and Arsenal have not started the season well) then wouldn’t the value of the rights to the Premier League go down, thus making the overall pot smaller?

Following that logic, it would seem to be more sensible to take the even split. And we haven’t even discussed the implications of this precedent on the split of domestic rights.

And funnily enough, Liverpool’s US-based owners (FSG) also own the Boston Red Sox. The MLB and other US sports enforce a very strict revenue sharing concept amongst their leagues, just the opposite of what FSG is looking to achieve here.

Given the Premier League was born of a desire to split from the clubs in the lower divisions so as not to share revenues with them, it’s not a surprise that greed is back, only that they don’t seem to have thought through the longer term implications.

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