One look at Reading's public accounts will give you a true insight into the state of English football.
Looking past the glitz and glamour of the Premier League, which Reading competed in just 11 years ago, you’ll find clubs struggling to merely balance the books and for which survival is an uphill battle.
Fear not though!
The Premier League announced a record-breaking £6.7 billion television rights deal earlier this month and, would you believe it, managed to protect the Saturday three o’clock broadcasting blackout, which is so dearly valued by clubs across the country.
Or, so it would seem.
Indeed, headlines following the rights announcement revolved around whether it was right to keep the Saturday afternoon blackout, as will be the case under the new deal, until 2029.
This itself will keep in place a rule introduced in the 1960s, barring the likes of Sky and TNT - the victorious parties of the league’s latest rights auction - from airing Saturday three o’clock kick offs.
Such a token gesture from the Premier League has and will always be about protecting attendances lower down the football pyramid in the UK.
The harsh truth though, is that it doesn’t matter.
Truthfully, any die hard football fan will tell you that they will watch their team whatever it takes.
It could be the fan following their non-league club on a Saturday afternoon.
But, realistically, it is far more likely to be a Premier League spectator tuning into an illegal stream at the same time.
Piracy
Indeed, in the words of Ampere analyst Minal Modha: “Piracy has become so prevalent that if you really wanted to be watching those [Saturday 3pm] kick offs, then the likelihood is that you already are.”
According to YouGov, some 5.1 million people in England, Scotland and Wales admitted to watching sport via illegal streaming websites over the first six months of 2023.
What’s more, a further 3.2 million claimed to be unsure, or opted not to confirm or deny, whether they had, with the sample also excluding under-eighteens.
As Modha puts it, were the broadcasting blackout to be scrapped, “I’m not convinced that the impact would be that severe” for English Football League (EFL) clubs.
For the suffering clubs like Reading, which has faced a year of points deductions, winding up petitions and poor performances in League One since reporting debt of £62.9 million in 2022, the importance lies not in whether a televised Premier League match coincides with theirs then, but rather in what they stand to gain from that game being on television.
Calls for more in solidarity payments
Admittedly, the Premier League does already funnel a proportion of its television rights revenue down through the Championship, League One and League Two.
Whether it’s enough, well, therein lies the question.
Currently, the English Football League’s 72 clubs share £130 million in annual solidarity payments from the Premier League, with clubs recently relegated from the top flight then separately getting a share of over £200 million in parachute payments.
In the case of this season, Leeds United, Southampton and Leicester dropped down and would have collectively been entitled to £143.4 million in parachute payments.
Such payments will continue, albeit getting smaller by the season, if they fail to secure promotion over the next two seasons.
Excluding these three, each Championship club gets £5.19 million in solidarity payments, with League One sides getting £780,000 each and League Two teams £520,000.
According to the Premier League’s own accounts, such payments amounted to around 16% of its revenue between 2019 and 2022.
Of course, the EFL has its own revenue, including from broadcasting rights.
But, at £132 million - and just slightly more than what the Premier League contributes minus parachute payments - it’s no wonder solidarity payments are viewed as a lifeline for the lower leagues.
Were the EFL to be offered more through such solidarity payments if, say, the Premier League could make more itself by allowing Saturday afternoon games to be aired then, common sense would tell you such a deal would shoot through.
Indeed, the EFL and Premier League have been locked in a lengthy spat over the size of solidarity payments.
Having been requested for 25% of television rights revenue in September, the Premier League responded with an offer for 19.31%.
That is, for 14.75% of its revenue through solidarity payments, coupled with 4.56% for relegated clubs as parachute payments - a feature the EFL said it would rather see scrapped.
How this was received varied, with Niall Couper, chief executive of football lobby group Fair Game, summing up the views of those against the proposal.
“The Premier League needs to re-look at this deal and take a holistic view of what is happening on the ground in our national game,” he argued.
“Clubs lower down the pyramid are struggling to pay their energy bills and are forced to cut back on community programmes.”
By all means, look at Reading - deducted points over unpaid tax during the past year.
The argument of poor leadership can indeed be made, but then look at Wigan and Derby - themselves constituents of the Premier League as recently as 2008 and 2013 respectively.
Parachute payments were not enough for all three, despite the Premier League’s best efforts at providing relegated clubs with the means to stay up.
Clearly, the little revenue that finds its way down from the top flight from its sale of television rights has also proven to not be enough.
Wider overhaul
Arguing for an overhaul of how these are distributed between the leagues, including through the use of incentives for clubs, Cooper added: “Football’s financial flow should be based on two elements: Divisional average attendances and how well run a club is.”
“That’s the model our experts have spent over two years developing.
“Without that football risks missing this once-in-a-lifetime opportunity to deliver the culture change the game needs.”
Given the King confirmed the introduction of an independent regulator for English football during the State Opening of Parliament last month, future changes may best not be ruled out.
And, in light of the EFL’s clear reliance on the Premier League, increasingly lucrative television rights deals are well in the interest of lower league clubs.
Of course, that’s if they stand to gain from more expensive television rights deals.
Premier League’s own struggles
At this point, it is important to note that, though the £6.7 billion deal indeed casts a shadow over anything seen previously, the higher figure did actually come with concessions from the Premier League toward Sky and TNT.
The league actively aimed to boost the value of the rights by offering more games up for sale, with the rights from 2024 being for around 270 games, compared to 200 currently.
Alongside this, the duration of the rights agreements are longer, coming in at four years from next season, rather than the existing three-year cycle.
Elixirr Consulting partner Iliya Rybchin had explained prior to the results of the deal being announced that broadcasters faced struggle, like many, with mounting costs.
This, he said, had been responsible for a lack of appetite toward broadcasting rights auctions carried out by Premier League rivals, Ligue 1 in France and Serie A in Italy.
A different approach was needed by the Premier League then, he continued, offering more stability.
Indeed, fewer streamlined packages being offered, with more games in each and the longer duration of such rights has proven successful in tempting broadcasters.
The downside? The amount the Premier League gets per game will be “reduced significantly,” as highlighted by both Rybchin and Monda.
Specifically, each televised game from 2025 to 2029 will fetch an average of approximately £6.2 million for the Premier League. Since 2019, this figure has sat closer to £8.6 million.
Needless to say, the 28% drop in revenue per game is stark.
Since the Premier League has already made such a concession, who’s to say broadcasters will not bargain even more next time around.
“With Amazon dropping out [...] and DAZN not coming in, if there are only two bidders for the rights in 3 years time, there’s no guarantee of additional revenue,” Monda pointed out.
In light of such a threat, Premier League officials will have to ask what else they can offer to broadcasters to buoy the value of their rights. Say, the Saturday broadcasting blackout?
Discussing if such a prospect leaves the blackout at risk, Monda added: “Fast forward to the next cycle and it might well be if that’s the only way the Premier League believes it can grow revenues.”
Most games aired anyway
As stated, the case for the three o’clock ban has and will always be the same.
“For so long, the rationale for the blackout has been to protect attendance of those [lower] leagues,” Modha explained.
“I don’t think they [the Premier League] would be too keen to rock that boat just yet,” she argued.
A Premier League game being played and broadcast at three o’clock on a Saturday threatens this, as the old saying goes.
But does it?
The reality is, the majority of Premier League games are not even played at three o’clock on a Saturday anyway.
Under the new deal, Sky will show “at least” 215 games per season, rather than roughly 128 traditionally, after being awarded four of five available packages.
TNT will air 52 games from the final package meanwhile, with the league boasting that each of these near-270 matches will be aired live “for the first time”.
That is, the Premier League confirmed the broadcasting ban would still be in place under the new deal, with all matches not in this window now set to be shown live.
Given the Premier League hosts a total of 380 games a season, just 110 roughly can be expected to kick off at three o’clock on a Saturday afternoon then.
That isn’t even one third of the games due be played each season, despite the Saturday afternoon kick off slot having been entwined into the English football's traditions for so long.
This begs the question: Is there even any point of the Saturday three o’clock ban if most Premier League games are simply moved to cater for it?
Considering the desperate need for more cash flow to the lower leagues, does an end to the Saturday three o’clock blackout not provide the perfect opportunity for the EFL to secure the extra funding it so clearly desires?
On the contrary, it may well be the only thing standing in the Premier League's way of another record television rights deal.
What would it be to turn away such an appealing prospect?