Why are the AFCON rights so expensive?
Gary Al-Smith asks why Africa's own homegrown Nations' Cup has been so overpriced that many African countries are suffering to watch their own event.
Angola 2010 has come and gone and we now know the winners and know the losers on the pitch. Yet, there were hundreds of millions of losers in homes across Africa who wanted to see their teams but could not.
Before the start of the tournament, many people in homes across Africa were not sure if they could take part in the tournament. The costs for broadcasting rights had soared to the high heavens and had threatened to leave several African Nations from the football fun that was in Angola 2010. Ghana was nearly among these.
Many readers may not be aware that for the timely intervention of the Government of Ghana, we would not have seen tournament on free-to-air TV and the joy (or pain, depending on how to you see it) of placing second would have been lost on the populace.
In the past year or so, three Ghanaian television stations – the state-owned Ghana Television (GTV), TV3 and Metropolitan Entertainment Television (Metro TV) - have successfully joined forces in a consortium to buy rights for major FIFA tournaments to show viewers. That is how they were able to show the FIFA Confederations' Cup in South Africa, the Under 20 FIFA World Cup in Egypt and the Under 17 FIFA World Cup in Nigeria.
Naturally, we expected the same to be the case for Angola 2010. What happened was that the consortium resorted to the African Union of Broadcasting (AUB, formerly known as URTNA) to secure broadcast rights for the Angola showpiece. The stations could not foot the whopping US$ 1.5 million quoted by right owners AFNEX LC2.
At the time, Ken Ashigbey, General Manager of Optimum Media Prime, who fronted for the consortium said: “We have spoken with AUB and I am very hopeful that we will be able to tie the deal in the shortest possible time." Yet even with this point, he went on to hit the nail on the head on a salient issue: "The US$1.5 million is on a high side for the Ghanaian economy and many economies in Africa especially will struggle to find the money. We have told them there is unity in strength and because this is an African event, it is imperative that Africans are given the right to watch the tournament and enjoy it."
Ghana was among the lucky few whose government's stepped in to offset the costs. Tunisia was not so lucky so they did not watch a single game on free-to-air and had to make do with coverage from digital and cable TV.
The crux of my beef with the rights holders is this: why do we have to fight every time the Africa Cup of Nations is played? Why is there an unseemly tussle over the cost of rights?
The sales agent for the event is LC2-AFNEX and it names unrealistic prices for buying the rights. A good many African broadcasters are resigned to despair and do not even try to foot the bill which is, frankly, outrageous. At the last minute, some get Government funding (like Ghana did) to help and annoyingly, LC2 accepts a lower price.
All this happens weeks or days before the Nations Cup starts and that means that promoting the event in the run-up to kickoff is lost. If you recall the adverts for Angola 2010 started rolling rather late on the screens. Metro TV started running promos on the 3rd of January, just seven days to the start of the event! Anyone in broadcasting would tell you this is unacceptable because you then give viewers little time to mentally prepare for the event. I feel there is a better way to help African football and broadcasting to help each other grow. T
The organizers of the Africa Cup of Nations are the Confederation of African Football (CAF) and the biennial event dubbed Angola 2010 is the 27th time it has been played. CAF sells the rights to broadcast the event's matches to a company called LC2-AFNEX which through LC2 Medias is owned by LC2 TVNETELECOM.
The latter is a Beninois company launched in 1997 that also does regional Pay TV and has recently got into Internet TV. It got its first contract to sell the event in 2003. AUB is supposed to assist the process and support it with a marketing plan.
However, in effect, the AUB has become implicated in the whole process of trying to get extremely high rights fees out of African broadcasters. The issue has been a running sore for many years so when Larry Atiase, the AUB's CEO wrote to broadcasters – including Ghana – on 30 December 2009 he attempted to strike a conciliatory note. Atiase said the fees have been segmented into different groups. Under the reference 'AUB/LC2 -- AFNEX Final Proposal, AFCON 2010 broadcast rights', Atiase wrote:
"I have the pleasure to inform you that AUB/LC2-AFNex negotiations on AFCON 2010 broadcast rights have led to proposals indicated below:
“AUB and LC2-AFNEX have agreed on the importance of reducing rights fees to enable the broadcasting organizations in all African countries to broadcast the matches.
"Both organizations have also agreed henceforth to work together to find ways and means of further reducing the broadcast right fees for the 2012, 2014 and 2016 African Cup of Nations, including sustaining the AUB marketing plan. Consequently, your organization is requested to confirm its participation in the coverage of AFCON 2010 in writing to AUB secretariat while granting the Union three minutes of airtime as well as pay the broadcast rights fee latest on the 7th of January 2010.
"AUB will present a report on the utilization of airtime granted by member organizations to reduce the cost of broadcast rights fees."
This is what Atiase wrote to broadcasters around Africa but as happens every time, there were winners and losers in the Africa Cup of Nations rights farce.
Nigeria's NTA put up the money to secure the 28 live matches and all subsequent tournament matches through to 2014. NTA's zonal director, Yusuf Jibo said when it was announced that he was willing to work with other TV stations (by implication private sector ones) to increase match coverage. But this pitch was also carried an implicit threat as in the past there has been extensive pirating of transmissions and he wanted to avoid this by signing agreements in which it collects revenues.
By contrast, Zimbabwe's ZTV was unable to afford the €3.5 million (about US$5,047 million) for the matches to be beamed on the channel. According to ZBC Public Relations Manager, Sivukile Simango: "ZBC (the parent company of ZTV) does not have that kind of money to spend on a tournament which only lasts 22 days. The figure they are requesting is far much more than what we could afford."
He said the national broadcaster would rather use the money demanded by CAF to procure equipment such as an outside broadcasting van. He promised live match updates as a rather poor substitute for live coverage. The issue has been a subject of some controversy in the country because the World Cup screening rights have by contrast cost just US$75,000.
Kenya's KBC went on record as saying:" KBC, however, regrets that the costs of the TV rights for the tournaments are still too high as to make any socio-economic sense...most business companies and concerns are on end of year vacations and will resume on 11th January 2010. On account thereof it will be difficult to commercially exploit the events assuming that the cost was reasonable and agreeable. Consequently, KBC cannot, in the circumstances and given the onerous acquisition conditions, take the rights just like UBC (the Ugandan public broadcaster).
Tanzania Broadcasting Corporation also echoed these sentiments: "We at TBC totally support you and those of you who find the costs too high. We also cannot afford and the time has almost run out for soliciting any sponsors".
The NBC's Sackie Shikufa also said the same:"The Namibian Broadcasting Corporation (NBC) regrets to inform you that due to the high price of the broadcast rights for this AFCON in Angola, NBC will not be able to broadcast the tournament. And I'm also concurring with my colleagues who expressed their concern about the high right fee".
According to Uganda's UBC's Sales Manager William Odoch"...we regret to let you know the UBC cannot afford the rights to air 2010 AFCON Angola. Our position was to retain the rates at the 2008 AFCON Ghana which is way over and above the quotation. We hope the rates will be more affordable next AFCON and in good time. UBC can now communicate its inability to afford the games and prepare Ugandans.”
Atiase said AUB had noted with concern the valid points raised by its members over the high fees but does not have the powers to reduce the fees since they are not the broadcast rights offer holders. In other words, the AUB is powerless to act as a negotiating party on behalf of others.
Instead the AUB made proposals that the following sponsors shall be given the right of first offer for 30 days: Orange, Standard Bank, Pepsi, Puma, Nasuba Express and Samsung. But this was probably too little, too late. Furthermore, although the AUB is talking about lowering the rights fees, it is only going to do this by trying to raise the sponsorship revenues. This does not address the central question of: why are the rights fees for Africa's homegrown tournament so overpriced?
Ridiculously, the broadcasters are also barred from the barter system where they can use what they have to get what they want.
The Botswana government reportedly approved state broadcaster, Botswana Television's (Btv) request for funds to acquire the Africa Cup of Nations (AFCON) broadcasting rights but a blunder led to the games blackout. The state reportedly approved Btv's request for the broadcasting of the AFCON. Btv viewers were left in a lurch after the state broadcaster stopped the live transmission of games a day after kickoff. Payment was reportedly not made on time, resulting in the blackout on live coverage. The sum involved was US$4.8 million.
African state broadcasters have tended to be the favoured party to sell rights to because they have wider coverage than their private sector peers. However, with notable exceptions, forward planning is not their strong skill. Therefore raising sponsorship takes place at the last minute. For its part, the rights holder waits until the last minute before signalling any last minute drops in price so as not to spoil the lucrative deals from those who can make the payments demanded.
Any number of things is wrong with how the current process works. The AUB is not an effective body to represent all broadcasters and private sector broadcasters are not getting the kind of "look in" they should. The sharing of rights in here Ghana is an interesting approach as it is difficult to imagine any single broadcaster clearing its schedule for all 28 matches across 22 days.
Indeed, the foresight of GTV, TV3 and Metro TV coming together to form a consortium is quite novel and has been hailed across the African broadcasting sphere.
But the nub of the difficulty is CAF's attitude to the business: maximizing its income is not necessarily the best way to help develop an ecology of broadcasters, sponsors and fans to develop Africa's homegrown tournament. The rights are absurdly expensive and there is little evidence that the Confederation of African Football has done much as much as it could with the funds raised.
You do not have to be a soothsayer to know that African football is not where it is supposed to be. Please, do not even say that there is no money. In my next piece, I hope to inform you about how much CAF made in the last fiscal year and ask some pertinent questions on what they do with the monies allocated for media rights to CAF competitions.
An investigation that looked at comparing rights for different sports events should bring pressure on them to lower their fees. This and a more transparent bidding process for the appointment of the sales agent would all be steps in the right direction.
Credit: Gary Al-Smith, who is an Accra-based freelance journalist
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