Al Jazeera uses sports to expand in Europe
Paris, April 2, 2012
Al Jazeera, best known for its Middle Eastern news coverage, is taking aim at Europe's pay-TV market, using sport to build a global media brand.
The broadcaster is racing to launch a new French channel in early June in time for the European soccer championships, offering a service for about 11 euros per month, according to three industry sources. The channel's name, 'beIN Sport', has been trademarked worldwide.
The sports world is also buzzing with anticipation that Al Jazeera, with Qatar's gas and oil wealth behind it, could put big money on the table to bid for UK rights to the English Premier League now mostly held by News Corp affiliate BSkyB.
"The Qataris see sport as being an entree for themselves on the world stage, and the next piece in the jigsaw puzzle is a really big rights acquisition," said Graham Shear, a lawyer specialising in sports matters.
"The Premier League chief executive Richard Scudamore is trying to generate a competition; he would love to see Sky and Al Jazeera go head to head."
No one who has watched Al Jazeera become the most watched news channel in the Arab world will underestimate the company, nor its importance to Qatar. The emirate has kept the financing taps open despite repeated protests from neighbouring countries against the uncensored views it broadcasts and hostility from the West for airing videos from Al Qaeda leader Osama bin Laden after the organisation's deadly attacks on the United States in 2001.
The broadcaster is already no novice at sports coverage. In the past decade, it has built the most popular sports network in the Middle East and Africa, with two free and 15 pay channels, plus an English version with a dozen commentators and producers.
But to create a local European player it will have to take on established pay-TV groups in each market, shell out big money for rights, especially in England, and overcome its lack of a distribution network.
Both Sky and France's pay-TV leader Canal+, which is owned by Vivendi, have large subscriber bases built on broad offers featuring exclusive movies, TV series, and sports. They control their distribution via satellite, while Al Jazeera will have to sign deals with cable, telecom, and satellite companies to get its channels to air.
"There is no real example of a challenger in the pay-TV business succeeding in dethroning an established player, although many have tried," said Claudio Aspesi, media analyst at Bernstein Research.
"You can spoil someone else's business pretty easily by pushing up the cost of the content rights, but that doesn't mean that you can create a profitable business for yourself."
Since Al Jazeera has said little about its plans and declined requests for an interview, it remains unclear what their ambitions are for their sports channels nor how much money they will devote to it.
Its competitors worry that with Qatar's riches, it will be able to outbid them for rights and then support years of losses while it builds out its business, as it did for the news business.
Canal+ deputy chief executive Rodolph Belmer told Reuters that the French pay-TV network could handle competition with Al Jazeera's new channel entry for now because it had secured key sports rights for Top 14 French rugby and the biggest French and European soccer games.
"For the next four years, we don't see any risk to our business model or our development," said Belmer. "The question is what will happen afterwards and whether Al Jazeera seeks to become hegemonic by drawing on Qatar's great wealth, or if they act rationally and are willing to co-exist with us."
In the past 10 months, Al Jazeera has spent about 300 million euros ($400 million) scooping up broadcast rights to France's soccer league, the Champions League and Europa League, as well as some top-flight games from Germany and Italy. - Reuters