Setanta Sports in receivership/administration [Many merged]

AugustusMaximus

If Setanta does indeed fold, can anyone guess what is going to happen with GAA coverage in the UK ?

Will the GAA try to deal with Sky Sports who aren't exactly loaded with live sport during the summer months ?

Sponge Bob

I believe that Setanta will show the championship this year while in administration .

http://thescotsman.scotsman.com/uk/Setanta-faces-final-whistle-and.5342624.jp

It is understood that administrators are on standby to act for the Irish firm unless it can agree a last-minute rescue with investors.

The Irish firm failed to pay £3 million to the Scottish Premier League (SPL) last week as the final part of a £13 million contract for the broadcasting rights of last season.

The league has had to pay member clubs their share of the cash from its own funds, and awaits Setanta to repay this today.

Many clubs, particularly the smaller ones, rely on the revenue from television rights to bolster their income and in some circumstances this can represent a quarter of their turnover.

Setanta has also been seeking to cut the price of its current £125m deal with the SPL, which is due to start in 2011.

The company has about 1.2 million customers but this is well below the 1.9 million needed to break even.

Charles Barnett, a football business analyst with accountants PKF, said that the SPL and its members now faced severe pressure.

"The SPL has until mid-August to find a replacement broadcaster"

johnny_adidas

should subscribers be worried about cancelling direct debits?

Sponge Bob

If I paid monthly , no . If I paid annually I would change to monthly right now.

icdg

Sponge Bob wrote: »

I believe that Setanta will show the championship this year while in administration .

http://thescotsman.scotsman.com/uk/Setanta-faces-final-whistle-and.5342624.jp

A moot point seems to be that it would actually be Setanta's UK subsidaries that would be in administration. Administration has not been introduced in Irish company law so examinership or recievership would seem to be the options for the holding company.

It would be up to the examiner / reciever / administrator to decide whether or not the channels would be closed, although if they proceed on the basis that Setanta is a going concern they might not be closed. I would not be too hopeful though, unless they can find a buyer with deeper pockets.

Hagar

johnny_adidas wrote: »

should subscribers be worried about cancelling direct debits?

Personally I would cancel immediately and pay by cheque each month.

Widescreen

I'm just hoping ESPN America is on until October, as I follow the Baseball avidly. I was always into the cricket and many trips to the US in the last 10 years have got me addicted to baseball.Believe it or not,if you know the rules its a fascinating game.

If Setanta go to the wall it will be a blow but maybe,just maybe some of their sport may go to FTA channels.

Sponge Bob

My main point is that administration ( UK) or examinership ( Ireland) will keep the show on the road until September or so . Who knows, it may come through the process with most of its sporting rights intact .

Either way , Galway will have done the double by the time the screens go blank

EDIT , the BBC has more news here

http://news.bbc.co.uk/2/hi/business/8090633.stm?lsf

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

Mossy Monk

Widescreen wrote: »

I'm just hoping ESPN America is on until October

Setanta do not own ESPN America

brenny2506

Just seen posted on Digitalspy.....

"Setanta Sports is not accepting new subscriptions at this time.

The beleaguered pay TV sports broadcaster's subscription website reports that it is "down for routine maintenance". Messages left on its phone line tell prospective customers that the subscription option is "temporarily out of order" and that they should "try again later".

The development comes as Setanta is reported to be close to administration after defaulting on a £3m payment to the SPL."

Is there more to it than just "routine maintenance"

bishops palace

Yea looks like bad news for them. Check out this article in the times
http://www.irishtimes.com/newspaper/finance/2009/0609/1224248422507.html

mburke

If setanta goes will it go worldwide or just UK / Ireland as it was a very handy channel for Irish people in the US / Australia. If gone wonder will a new company be formed to provide the service internationally.

bishops palace

good question but i don't know, i think if they are all under the same parent company they should all go. it depends on what happens this week but rumours are that the offers in are not enough. watch this space.

Widescreen

Mossy Monk wrote: »

Setanta do not own ESPN America

I know,but I'm paying Setanta for it! What do you think may happen if they do go into admin? thanks:)

Widescreen

More Setanta information/speculation...

http://news.bbc.co.uk/2/hi/business/8090633.stm

http://news.bbc.co.uk/2/hi/business/8091195.stm

Mossy Monk

Widescreen wrote: »

I know,but I'm paying Setanta for it! What do you think may happen if they do go into admin? thanks:)

Not sure but i'd imagine Disney/ESPN wont want to see their channel go off the air for any amount of time.

Pat Gleeson

Widescreen wrote: »

What do you think may happen if they do go into admin? thanks:)

I was wondering the same thing myself.

icdg

Scottish Television apparently have the inside track on this one...sources at the SPL, I wonder...

http://sport.stv.tv/football/101487-setanta-hours-away-from-coming-off-air-stv-understands/

The reporting is a bit hazy ("will be told this evening that the company is in administration" for instance - you need to go to court to have an administrator appointed, for one thing) but it seems to infere that Setanta will close at midnight.

afatbollix

the GAA would get the guts of a 5er from sky for there rights... same with all the others on setanta...

why would sky pay top dollor if theres no one else to take them??? sports is in for a bad ride over the next few months...

The Bull

Some Q and answers posted on the bbc website

Q&A: The future for Setanta


Setanta needed more football fans to subscribe
Setanta faces administration "within days" unless backers provide more funds to pay £30m it owes to the English Premier League, reports suggest.

But what would this mean for the broadcaster, its customers and those sports which have sold television rights to Setanta?

I am a Setanta subscriber. If it goes into administration, would all coverage stop?

It is too early to say for sure - and the firm is not talking.

One prospect is that the administrator continues to run the company as a going concern - broadcasting as normal - in case an investor can be found.

When ITV Digital collapsed in 2001, administrators took six months to see if they could work out a deal with rights' holders, during which time the broadcaster continued to operate as normal. The broadcaster's rights were eventually bought by BSkyB.

However, it is possible that Setanta's output would be halted - and presumably payments from its 1.2 million subscribers would stop with it.

What about the television rights that Setanta has bought?

If the firm breaches its contract with the Premier League - for example by missing payments - it is likely that the rights will revert to the league for them to resell.

Setanta's current Premier League TV deal has one more season to run. Sky could pick up one of Setanta's two Premier League packages for the 2009/10 season (which each include 23 games) - but it is barred from buying both under competition rules.

Walt Disney's ESPN TV network has previously considered bidding for Premier League rights as part of its strategy to expand internationally, and is seen as potential bidder.
Other potential bidders could include ITV, Channel 4, the BBC and Channel 5, according to media analysts.

From 2010/11, Setanta is only due to be showing one Premier League package of 23 games per season. Again, these rights would have to be resold.

So is the Premier League going to miss out on cash?

For the current TV deal, investor guarantees mean that the Premier League will receive its payment for the 2009/10 season - so there should be little impact on the revenue of clubs.

However, beyond that, analysts think it is unlikely that the Premier League could match the £159m Setanta paid for the right to screen 23 Premier League games over three seasons from 2010/11.

Given the widespread tendency to spend on new players, wages and stadium developments on the basis of projected earnings - this could leave clubs with a deficit on their balance sheets.

Is it only Premier League football that would be affected?

No. According to an estimate by Citibank, Setanta pays about £85m annually for rights for the Scottish Premier League, the Football Association (England games and the FA Cup), boxing and the US PGA tour.

Setanta is facing a battle for survival
These rights would be resold and, given the economic climate, the rights costs would "more than halve", according to Citibank analyst Marc Sugarman.

This would affect how much cash filtered down to different sports - from top level to grass roots.


"The ripples from the disappearance of Setanta would spread very broadly."

Setanta's current four-year deal negotiated alongside ITV to broadcast FA Cup and England international matches runs until July 2012.

The BBC understands that under the terms of the contract, ITV is obliged to pick up Setanta's eight remaining home friendly matches at a pre-arranged reduced price should the broadcaster fail.

How did the price of sports broadcasting rights get so high?

The price of desirable rights such as the Premier League and top-flight rugby has risen largely because Sky wants to keep its audience, and so it is prepared to pay top dollar to secure the best events which are so central to its business.

Setanta wanted coverage of the Guinness Premiership rugby union tournament, but it had to pay £54m over four years just to share it with BSkyB.

And analysts generally agree that Setanta vastly overpaid in its £125m deal with the Scottish Premier League over five years - an agreement on which it missed a £3m payment last week.

Are there other options open to Setanta to continue?

One possibility is for Setanta to overhaul its entire business model.

Currently it sells mainly to retail customers - who pay specifically to receive the channel.

But it is understood that another option would be for it to become a wholesale supplier of programmes to firms such as BSkyB and BT Vision.

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.

Capt'n Midnight

afatbollix wrote: »

why would sky pay top dollor if theres no one else to take them??? sports is in for a bad ride over the next few months...

Is there any way the clubs can get all the money owed as I don't think Setanta will get lots more customers ?


The clubs have the option of bankrupting Setanta now and getting some of the money but loosing out a bidder against SKY in the future

Or

they could take a hit to keep Setanta viable and gouge them later on

flazio

Most of the reporting and what not seems to be from the POV of their UK operations Setanta Sports 1, 2 Golf etc, but I'm concerned about what the future is for the Setanta Ireland channel and the stuff they carry exclusively within the Republic of Ireland like Champs League that RTÉ didn't pick up and F1 and 3pm Saturday Prem games. What happens to them?

watty

The UK channels run by Setanta Sport are
Arsenal TV (tv)
Celtic TV (tv)
Chelsea TV (tv)
LFC TV (tv)
Racing UK (tv)
Racing World (tv)
Rangers TV (tv)
Setanta Golf (tv)
Setanta PPV 1 (tv)
Setanta PPV 2 (tv)
Setanta Sports 1 (tv)
Setanta Sports 2 (tv)
Setanta Sports News (tv)

Then there are channels in various other countries including Ireland. There there is some talk of saving parts of the buisness, but anything not very profitable (most of the Setanta "Direct to home" never got the subscription numbers needed to even be close to breaking even) is not likely to survive, except maybe if the brand and/or rights bought by someone else like Sky, ITV, Five or Virgin.


The clubs are unlikely to want to take over Setanta as it has not enough customers. It would simply lose more money.

Doubts remain over Setanta SPL deal

Tuesday, 9 June 2009


Talks between the Scottish Premier League and Setanta are ongoing as a question mark remains over the broadcaster’s ability to honour their television deal.

The board of the Irish-based company met yesterday and will continue to work on a rescue package, with the next couple of days expected to be crucial.

Fears were raised when Setanta failed to pay the final installment of this season’s TV deal last week.

A payment of £3million was due last Monday but that money has still not been received by the SPL last night.

The 12 SPL clubs came to an agreement in April following Setanta’s request to change the terms of the contract due to begin at the start of the 2010-11 season, which was initially worth £125million.

Taken from the Belfast Telegraph

snaps

i dont think sky can have all the premiership matches? Isnt it a maximum of 5 out of 6 packages? You can quote me on that. But i cant see the like of BBC, ITV, ch4 or 5 having that kind of money to pump into the greedy hands of the Epl.

Come on mr branson do us a favour and take on setantas debts and sort this mess out.

Pat Gleeson

snaps wrote: »

i dont think sky can have all the premiership matches? Isnt it a maximum of 5 out of 6 packages? You can quote me on that.

Come on mr branson do us a favour and take on setantas debts and sort this mess out.

That's correct. Part of Setanta's package is what used to be the Premiership Plus matches. Richard Branson is shrewd - he didn't get where he is now by bailing out companies like Setanta. Like any other vultures circling around the bones of Setanta at the moment, a lot of cherrypicking will go on.
I fear for ex-pat coverage of GAA and stuff like Irish schools rugby and Irish minority sports. I can't see anyone picking up much of that. If Setanta didn't overreach themselves, they would still be in a position to provide this kind of service in the future.

Foggy43

Please do not count on Richard Branson.
He has a 10% stake in Virgin Media. He gets a certain amount for promotional appearances, £100,000 per year I think.

He sold off most off his empire and put the cash into his airline.

weehamster

I am very surprised why Setanta don't ask the EPL to create a new package or 2 to help. I cant see why not as the EPL will get more cash.

However if the EPL say no, then Setanta should take them to European Court and put forward the case about what is the minimal required to break even and if the EU wants to stop a monopoly then packages must be sold in 2's or 3's to avoid a channel going in to problems like Setanta is experiencing now. :cool:

Pat Gleeson

weehamster wrote: »

However if the EPL say no, then Setanta should take them to European Court and put forward the case about what is the minimal required to break even and if the EU wants to stop a monopoly then packages must be sold in 2's or 3's to avoid a channel going in to problems like Setanta is experiencing now. :cool:

Setanta vs. Sky in EU court .....

The EU were the instigators of the change in packages in the first place. Sky's business model for sports acquisition is to ensure success in bidding for sports rights - i.e. bidding higher than anyone else. Before the EU got involved, Sky bid high for exclusive UK / Ireland rights for PL games.

The EU effect has Sky bidding high for the best packages, and Setanta bidding more than they could raise in revenue for the rest - that's business. I'm no Sky fanboy, I would love to see someone really take on Sky and reduce the subscription cost of Pay TV sports, but they have revolutionised the way sports are covered for the last 15 years or so. Sky pay what they think the rights are worth, you can see the investment onscreen, and people pay Sky what they think the coverage is worth - that's business too.

The EU can (and have) put measures in place to prevent a monopoly on sports coverage, but they can't control market forces or set prices. This does not mean a better service or certainly better prices for consumers. It cost less then to see the same number of matches with Sky alone, as it does now with two providers.*

* Sky / Prem + Season Ticket vs. Sky / Setanta

watty

The measures had the opposite effect to that intended.

Setanta can't even pay for the packages they have and seriously underbid sky on some others.

It would make more sense for Sport and consumer to have a low cap on price paid to Sports and a cap on consumer subscriptions and have a monopoly. The high prices will destroy football. They have already distorted it past breaking point. It's too much money. Players are getting paid x20 too much. The consumer is paying for it all.

It's an example of how eventually a "free market" may destroy a resource and fleece the consumer on the way down.

Foggy43

BBC business this morning, are saying there is a possible mystery person who may save Setanta. Talks are on going and they reckon another 72 hours before we know the result. Walt Disney's ESPN have denied any involvement.

Anyone any idea's? I cannot think of any other media tycoons unless Russia has someone to offer.

http://news.bbc.co.uk/1/hi/business/8096398.stm

afatbollix

just to tell ye a few things....

the company in most trouble is setanta uk... setanta Ireland and the international channels seem to be separate story... as they currently are making a profit ( unlike the English channels)

now if setanta UK went under the table today the Irish + international channels could stay afloat... the only thing that could let it down is the programs made in the uk which are better production than the Irish ones...

the rights for the EPL for Ireland + international hasn't been done yet so they still could have the same amount of matches as this year in 2010.. they will still have the same amount of matches in the 2009/2010 season as they did this year...

if they are going to go down today is the day as they owe that 30 million to the EPL today so if they survive today they have made it..

bk

afatbollix wrote: »

now if setanta UK went under the table today the Irish + international channels could stay afloat... the only thing that could let it down is the programs made in the uk which are better production than the Irish ones...

If Setanta UK go down, I can't see Setanta Ireland surviving. Yes SI might be profitable, but they are probably heavily piggybacking on SUK made channels and content. If they had to do them themselves, I'm not so sure there would be profitable.

Foggy43

This is the man....or this is what the BBC are saying...

http://news.bbc.co.uk/1/hi/business/8097421.stm

A bit more info

http://www.rte.ie/news/2009/0612/setanta.html

Sponge Bob

£20m for half of it, most generous.:cool: And yer man is involved in the biggest commercial DTT operator in the UK too.

They were trying to peddle the lot for US$ 1.99 Bn a year back

[edit ] he had three percent so that would be 48% for £20m , see

http://www.telegraph.co.uk/finance/newsbysector/mediatechnologyandtelecoms/media/4550756/Russian-oligarch-Blavatnik-buys-secret-stake-in-pay-TV-firm-Setanta.html

200motels

Here's what the Times had to say about it.


From The Times

June 13, 2009


Billionaire saves Setanta from collapse




Tom Dart


British football can carry on spending after a deal was agreed to save Setanta Sports last night that should mean clubs and governing bodies continuing to pocket hundreds of millions of pounds in television revenue from the broadcaster.
Access Industries, a company run by Len Blavatnik, a billionaire businessman, will pay £20 million for a 51 per cent stake in Setanta to help it to avoid administration.
Setanta’s football rights include the FA Cup, World Cup qualifiers, the Barclays Premier League, the Clydesdale Bank Premier League and the Blue Square Premier.
Setanta’s three-year, £392 million deal with the Premier League to show 46 live matches a season expires after 2009-10. The broadcaster paid £159 million to screen 23 games annually for three years from 2010-11. Setanta ran into financial trouble when it lost half its Premier League live games, leading to fears of a mass exodus of subscribers. The crisis evoked memories of the collapse of ITV Digital in 2002, when the operator went under owing Football League clubs £180 million.
Related Links

• Russian oligarch rescues Setanta with £20m deal

• White knight enters the fray for Setanta

• Setanta switch-off may cost clubs £500m

The Premier League is due a £30 million payment but is understood to be willing to wait while the rescue is finalised. Under the terms of ITV’s deal, it would gain the rights to eight England friendlies until 2012 if Setanta went under, which seems unlikely.
Setanta has already failed to pay the Scottish Premier League £3 million it is owed. Setanta closed itself to new subscribers on Wednesday but once the deal has gone through it is expected to continue selling subscription packages via Freeview and Sky. It has about 1.2 million subscribers but needs closer to 1.9 million to break even.
ESPN, which is thought to be eager to break into the market for live rights, distanced itself this week from suggestions that it could take over Setanta’s Premier League games if the company went into administration.
Blavatnik is a Russia-born American citizen who has invested in Russian oil. He also backs TopUp TV, which operates pay television on Freeview, has a stake in Sport 5, an Israeli channel, and a stake in Perform Group, a digital sports rights business with clients including the Premier League and some of its clubs. Other investors are expected to come forward to help Setanta to become profitable in future years.

icdg

Merging with existing thread.

watty

They are maybe 200M in Debt already, they oare behind €33M right now with more expenses in future and the UK operation doesn't make money and never has.

How does 20M for 51% save them?

200motels

watty wrote: »

They are maybe 200M in Debt already, they oare behind €33M right now with more expenses in future and the UK operation doesn't make money and never has.

How does 20M for 51% save them?

It's the potential for future investment that the 20M for 51% makes good business sense, if they hadn't accepted it they would have gone to the wall which would have been a travesty.

BrianD

watty wrote: »

They are maybe 200M in Debt already, they oare behind €33M right now with more expenses in future and the UK operation doesn't make money and never has.

How does 20M for 51% save them?

One presumes it provides the cash (or some of the cash) to pay these deposits to the various sporting rights holders. Setanta is a fine example of a victim of the credit crunch. It's growth was tied to the availability to cheap and plentiful credit.

The named investor is already a minority shareholder so would have had the advantage of the inside track. Plus given that he is also a holder in Top Up TV, he's also potentially getting a slice of Irish commercial DTT.

My understanding is that the Irish and international parts of Setanta do well (particularly in the USA) but their growth would seem dependent on the group negotiation of rights.

Setanta has been a great Irish success story to date so lets hope that they can get out of the current difficulties and progress.

watty

I think Setanta are a failure since they tried to move from Niche to competing against Sky and other DTH sports esp. in UK.

I can't see the business model.

A slice of Irish commercial DTT is a way to lose even more money. That's even less viable.

Credit fuelled Growth that increases Debt only looks like success if you consider only the public exposure. If you consider the debt, profitability and potential, then they are a failure. Maybe Anglo Irish Bank is another great Irish Success story?

BrianD

watty wrote: »

I think Setanta are a failure since they tried to move from Niche to competing against Sky and other DTH sports esp. in UK.

I can't see the business model.

I agree and disagree. To take on the likes of Sky is a big gamble. Sky threw loads of money and got prised rights out of the mits of the BBC and ITV. Though the advantage they have is that they also have their own platform and, as I recall, the initially used sport as a subscriber driver to Sky Digital. Had Setanta not been outbid on the last rights bidding round, I think they would have been on course to challenge Sky. At least notionally they would have been in a position to do so. My guess is that you need 5 years as a rights holder to build subscribers and a further 5 years to really firmly establish that base.

It seems that the model is that you throw money at it till you're the biggest (and probably the only) player. Alternatively you get to a tipping point of subscribers that you flog it off to some one else and let them figure it out!

A slice of Irish commercial DTT is a way to lose even more money. That's even less viable.

I would agree! Though you now have the investment of a very wealthy individual who simply may have his own agenda. Having said that, if he's into digital TV, there are probably more attractive markets.

Credit fuelled Growth that increases Debt only looks like success if you consider only the public exposure. If you consider the debt, profitability and potential, then they are a failure. Maybe Anglo Irish Bank is another great Irish Success story?

Yes both had the stuffing knocked out of them when the credit merry go round came to halt. Though in fairness, the Setanta business plan would have been based on subscriber acquisition and an income based on each of them. It was a numbers game. I don't think anybody really knows how the Anglo Irish business plan functioned!!!

Foggy43

The BBC have just said the FA have terminated any agreement it had with Setanta.

Not good!

http://news.bbc.co.uk/1/hi/world/8109954.stm

DMC

Not the FA. The Premier League. (There is a seperate deal for England and FA Cup matches with the FA)

Sponge Bob

http://www.irishtimes.com/newspaper/breaking/2009/0619/breaking41.htm

The Premier League has announced it has terminated its contract with Setanta after the troubled sports broadcaster was unable to meet its contractual obligations with the soccer league.
The broadcaster’s 46 live matches for the 2009/10 season will now be sold off.
The Irish firm was given until today to fulfil “certain contractual requirements” or it faced losing the last part of its existing £392 million (€462.5 million) three-year deal.
Meanwhile Setanta is attempting to stave off administration by raising funds to help pay TV rights bills, which include the Barclays Premier League, as well as the FA Cup and Scottish Premier League (SPL).
A deal has been put forward by US tycoon Len Blavatnik’s Access Industries, which is reportedly offering £20 million in return for a 51 per cent stake. Big Brother maker Endemol has also been linked with an investment.
The company, which started taking new subscriptions again this week on hopes of a rescue, boasts around 1.2 million subscribers - but that is still short of the reported 1.9 million it needs to break even and customer numbers have been hit by the recession.
Setanta suspended new subscriptions last week, prompting fears over the future of the business. It also missed a £3 million payment due to the SPL under the current deal - forcing the league to pay clubs from its own pocket.
It owes £30 million to the Barclays Premier League. Deloitte has been lined up as administrator if the broadcaster’s survival efforts fail.

DMC

BBC say Len Blavatnik has pulled out.

SRB

BT have stopped taking Vision Subs again too.

snaps

thats a shame as no EPL no channel. Is this good news for consumers? Sky will obviously snap all the games up now and put up prices. Perhaps the bubble is bursting now. Foriegn channels under pressure for selling cheap subs, stupid transfer fees who know whats next.

Football used to be working class mans sport........Fish and chips on a friday and soccer match on a saturday. Not anymore,

Mossy Monk

snaps wrote: »

Sky will obviously snap all the games up now and put up prices.

They are not allowed snap up all the games.

themont85

Will SKy pick up 23 of the 46? I don't know if they will. It may not make them money as the expense to new subs won't add for the 2010 deal so i doubt it will here. Sky and the Premier League will want the matches to still be pay per view so I reckon the EPL will set up a 'independent' Prem Plus pay per view channel.

BrianD

The other side of the coin is that the premiership rights that Setanta had wil go back out to tender. I don't think that the second bidder will buy at the price that they offered in the market we live in now. This means that the if it goes to auction then the price will be probably lower than what Setanta paid. Assuming that there is nothing to stop Setanta bidding again (other than finance) then in theory they could pay less for what they have lost. Might be a win situation for them.

snaps

Mossy Monk wrote: »

They are not allowed snap up all the games.

They had all the games before setanta via PPV channel?