Hong Kong football fans have watched the broadcast rights for the English Premier League (EPL) change hands from one local TV station to another in the past 10 years.
It has been so predictable they can switch from Now TV to i-Cable every three years or so without having to remind themselves.
On Tuesday, Chinese internet TV operator Letv announced it has won the EPL broadcast rights, trotting out its chief executive, Richard Scudamore, to complete the fanfare.
Letv would not say how much the deal cost but reports put the price tag at US$400 million over three years, double what PCCW’s Now TV paid three years ago.
We have no reason to dispute that, plus the fact Scudamore flew in to help put the bells and whistles on the announcement tells us the deal was worth the trip from London.
But it’s not that the deal minted a surprise winner in Letv that is significant but the fact that it made losers of Hong Kong’s top broadcasters.
Hong Kong fans probably couldn’t care less about who delivers their EPL serving — and how — from August next year.
But they can’t help feeling strange that their service provider is not a local operator but a foreign company that does not even have a Hong Kong broadcast license.
For some murky reasons, Letv insists it’s a “pure” Hong Kong company.
In fact, it was founded by mainland billionaire Jia Yueting in 2004 in Beijing where the company is based.
Letv trades on the Shenzhen Stock Exchange where it is the biggest stock on ChiNext, the Chinese equivalent of NASDAQ.
The company did not have to convince Hong Kong fans about its provenance or pedigree, only EPL bosses that it’s a better alternative to Now TV or i-Cable, notwithstanding their ability to pay.
There’s no doubt the decision came down to delivery.
Where the Hong Kong stations appeared old and outdated with their traditional TV format, Letv looked young and fresh with its online streaming model.
Letv not only showed it has deep pockets but also that it thinks out of the box.
EPL matches have been money spinners for Hong Kong broadcasters, which is why Now TV and i-Cable provided an entertaining side show around the time of contract renewal.
But other than their time-tested business models, both have nothing new to offer.
Scudamore made a point of stressing Letv’s advantage — first in the world to offer a pure online video platform to carry EPL matches.
Also, Scudamore signalled to prospective bidders how EPL intends to handle future broadcast deals.
Letv is not the first foreign broadcaster to win EPL rights to an exclusive Hong Kong broadcast but it’s the first internet TV company to do so.
The deal allows it to bundle its self-branded high definition TV with its own set-top box and operating system.
The company is playing to its own strengths at a time of great challenges to traditional media, with advertisers increasingly shifting from television and newspapers to the internet.
Some sources say Letv got an assist from high-level politicians. For instance, President Xi Jinping is an avid football fan.
True or not, these claims don’t diminish Letv’s success. They prove how far up the chain the internet TV era has come.
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