England Mourns As Its Soccer Team Fails To Qualify For The Euro Championships, But It Is The UK’s Commercial TV Network Really Weeping As It Sees Up To £15 Million ($30 Million) Slipping Through Its Fingers

Sports has become so important because it is the one TV program that people really choose to watch live. And if they are watching live it means apart from the bathroom or coffee/tea/beer break they are also watching the commercials. When it comes to any other programming people don’t mind taping them and then zipping through the commercials.

So advertisers have come to appreciate that live sporting events are probably the best way to get the most eyeballs actually watching their commercials, and they’re willing to pay premium rates for that programming. Witness what CBS did earlier this month with the Sunday afternoon NFL game between the undefeated Indianapolis Colts and the undefeated Boston Patriots. It jacked up the advertising rates like crazy, still sold out, and to prove its point the game ended up getting the highest ratings for a Sunday afternoon NFL game in 20 years – a 39 share (65 share in Indianapolis and 63 share in Boston).

So sports is financially what really drives TV revenue these days, so one can only commiserate with ITV, the UK’s largest commercial terrestrial broadcaster, now that England have failed to qualify for the 2008 European Football (soccer) championships. The country considers it a major disaster (the coach and assistant coach were fired the morning after) and ITV, which shares broadcasting rights for the Euro championships with the BBC, figures it will be down up to £15 million in lost advertising next year without an England presence.

England crashed out of qualifying when it lost at home to Croatia 3-2 – even David Beckham, playing his 99th game for England couldn’t save the night. The BBC broadcast the game which at its peak had a 43% share. So if England had made it to the championships next year and if it made it into the later stages then no doubt the viewing figures would have supporting skyrocketing ITV commercial rates. But now that is nothing more than a dream.

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Nike Learns The Hard Way That Spending Millions On A Soccer Star Endorsement Can Be A Pain You-Know-Where When That Player Keeps Getting Foot Injuries Wearing Your Boot
Celebrity endorsements have always been somewhat dodgy, usually because of the morals clause or similar, but Nike has another bigger problem on its hands – a star British football player has been hurt for the third time wearing Nike’s star soccer shoes and all the denials of “It’s not our fault” still has doctors and players endorsing bringing back the old heavy football shoes. Not exactly the type of publicity Nike craves, the stars certainly wouldn’t be as agile, but would they be safer?

The World Cup Brings Advertising Riches To Some, But Not To All
China wasn’t even in the World Cup, and the tournament was held mostly in Chinese morning hours, but its web sites cleaned up big-time with huge advertising profits. For some European countries, the television advertising revenues could benefit by as much as 4%, but in others, including the UK, the World Cup has had a negligible effect on television advertising. And the ratings in the US for some of the games matched major domestic sporting events.

BSkyB Agrees To Pay An Average £4.76 million ($8.9 million) to Televise Exclusively, Including Broadband, Each of 92 UK Premier League Football Matches Per Season From 2007 – 2010, But Mobile Operators Say Football Is Getting Too Expensive For Their Tastes
The UK’s Premier League has just sold domestic television and broadband rights to its matches in 2007 –2010 to BSkyB and Irish broadcaster Setanta for a total of £1.706 billion ($3.27 billion) – a 60% premium over the last deal won exclusively by Sky in 2003.

The World Cup Effect: Extra Fee For Football Infuriates Maltese
Welcome to Sport Year 2006. Nothing will top it. There’s the Winter Olympic Games coming right up. Then, like the 900-pound gorilla, the football World Cup blocks out all else for millions of listeners, viewers and internet cruisers. Already plans are being set for all day, all week or all month football attention.

Dutch World Cup Game Watched By 10,000 on the Internet
Opening football rights to alternative platforms such as mobile phones and the Internet is a big deal for the European Union. So there was particular interest in The Netherlands where for the first time a match was shown in its entirety on the Internet as well as traditional television.

ITV knows from experiences just a month ago how badly not having England in the Euro 2008 championships is going to hit the bottom line. It made a killing both on the Rugby World Championships where England made it into the finals only to lose to South Africa in the Saturday night final, and for the Formula 1 final race of the year. The nearer England got to the rugby finals the more ITV’s rates went up and the same for the Formula 1 race where Brit Lewis Hamilton was in contention to win the driver’s championship – he blew it and it is said in doing so he cost himself a fortune in possible commercial endorsements.

The rugby final got a 58 share and at its peak it was 62 the highest numbers this year for any British TV program. ITV won’t get those kinds of numbers for a soccer championship without England. The Formula 1 race, occurring in the late afternoon UK time, reached an audience peak at the finish of 10.6 million, a 50% share, and the highest share for any Grand Prix in seven years.

The rugby championships were important to ITV, not only for the money but because it drew to the network the young, up market male viewer who is not the network’s main staple. Those same male viewers were the big hope for the soccer championships and while they may still watch, there won’t be as many as expected, and the pubs and sports bars won’t be nearly as full.

And it is not just ITV that is going to lose out to England’s non-appearance. Umbro, the team’s shirt sponsor, is expected to now lose millions of pounds in lost sales as the kids won’t be buying replicas of England’s football kit. The company, which is being bought by Nike, actually issued a financial profits warning the morning after the England loss. It said it expected a “substantial reduction in expected sales volume” because of England’s failure to qualify.

Even England’s Football Association (FA) is going to feel around a £10 million financial pinch from lost licensing deals and merchandise rights for the championships.

In all, based on Britain’s participation in the 2006 World Cup, the UK economy could lose around £1 billion ($2 billion) in various deals that now will not see the light of day, although there are some who say that money is discretionary spending anyway and if it doesn’t get spent on football it will be spent on something else.

The UK advertising industry was said to have spent more than £300 million ($600 million) for the World Cup, and the Euro championships will now draw much less than that. Supermarkets will get hit as there won’t be any England TV parties with food and booze, the bookies won’t see near as many bets, there’ll be no sales splurge for wide-screen thin TVs, not to mention the travel industry losing out big time in getting all those England fans to and from Switzerland and Austria, the co-hosts of the championships – the Brits flooded France for the rugby just to be there even if they didn’t have game tickets. The knock-on effect is devastating.

There’s not even a “second best” for England fans. Scotland and Northern Ireland also failed to qualify.

England Mourns As Its Soccer Team Fails To Qualify For The Euro Championships, But It Is The UK’s Commercial TV Network Really Weeping As It Sees Up To £15 Million ($30 Million) Slipping Through Its Fingers

The big deal in television broadcasting these days is sports. Advertisers are willing to pay premium rates to get in on the big games. Rupert Murdoch said that Fox Sports recently got $3 million for a 30-second ad on the 2008 Super Bowl telecast.