Champions League participation will gain even greater financial significance for Liverpool in the coming seasons after a bumper TV deal was reached.
Having managed to get an uplift from £1.2bn to £1.5bn when selling the next UK Champions League rights cycle from 2024 earlier in the summer, UEFA have bagged another significant rise in broadcast revenues.
For Champions League regulars like Liverpool, for whom Europe's top tier club competition is a vital part of their business strategy both short and long term, a further rise in media revenues will find its way back to the club through the TV market pool that distributes broadcast revenues among competing teams.
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UEFA has agreed a deal for the US media rights for its club tournaments, including the Champions League, Europa League and Europa Conference League, with Paramount Global, the owner of the CBS network, winning out in the race, beating Amazon to the punch in a six-year deal that is estimated to be worth around $1.5bn (£1.27bn), which breaks down at around $250m (£211m) per season, a rise of $150m (£127m) per year that had previously been paid for the $100m per year current cycle that was held by Paramount and Univision.
There will be a separate sale of the Spanish language rights, and given that the most watched league in the US is the Mexican LigaMX, and the large Hispanic demographic, it is likely to fetch well into the hundreds of millions, something that could push the overall value of the deal beyond £1.5bn.
While the broadcast revenues are distributed across the three UEFA competitions it is the Champions League that takes the lion's share.
Last season, 5.36m viewers tuned in to watch the Champions League final between Real Madrid and Liverpool, making it the competition’s most-watched final in US history. It is that growing interest in football in the lead up to the US World Cup in 2026 that has fuelled the rise in media rights, with the Premier League getting close on £2bn from the US media rights for its next cycle, a sum that takes the whole package to around £10bn.
While the European Super League plans that Liverpool were very much party to may have fallen apart in 48 hours last year, the desire for reform and to make more money from the Champions League has been achieved by the biggest clubs through the 'Swiss Model', which is set to be introduced from 2024 to coincide with the new TV deal. The competition will increase from 34 to 36 teams while the group stage format will change to a larger league. What it means is that there are more games for clubs, more chances for prize money and more opportunities to generate revenues through appearances on TV.
At present, discounting the media revenues, English clubs can make a maximum of £125m from Champions League success, something that will be pushed well beyond £150m come 2024 - in fact, including media revenues, the potential for annual success in the competition will push £200m. The extra games and banking on a higher price paid for media rights was something of a gamble from UEFA designed to head off any other attempts for another European Super League plan. It is a gamble that may have paid off with owners getting some of what they wanted through the reform.
When Liverpool won European football's elite club competition in 2019, their run to the final and subsequent lifting of the famous trophy meant they raked in £113m for their efforts, something that was a major factor in the club posting record revenues of £533m for the 2018/19 accounting period.
Before defeat to Real Madrid in Paris in May, the Reds had banked some £102m through prize money and media rights from last season's Champions League, while around another £18m had arrived during the competition from gate receipts. Positively, they will bank £2.9m more next season, which was already assured before the defeat to Madrid, thanks to an improved UEFA co-efficient from next season.
Based upon the distribution of Champions League revenues for 2021/22, the Reds received €22.7m (£19m) from the market pool. That figure was reached by receiving their chunk of the €600.6m (£502.5m). That is broken down by 528 parts valued at €1.137m (£0.95m) and then distributed to clubs based upon their coefficient position among the 32 qualifying clubs. For example, the lowest ranked club in last season's Champions League, Moldovan outfit Sheriff Tiraspol, received €1.137m from the market pool, while the club with the largest coefficient, Real Madrid, received that sum multiplied by the number of teams - 32 - to earn €36.38m (£30.44m) from the market pool.
Liverpool's 10-year coefficient sees them in 13th on the 10-year list, behind Borussia Dortmund, Sevilla and FC Porto. But the Reds will move into 10th on next year's list, with all three clubs qualifying for the 2022-23 competition based on their current domestic performance. That means the Reds will claim €26.15m (£21.9m) from next year's market pool. But even if they had won every game in last season's Champions League and lifted the trophy, they would still be four points short of Manchester United, who occupy ninth on the list, although they missed out on the 2022/23 Champions League and could soon be overtaken by their rivals.
The increasing value of the US market, which was also demonstrated in the willingness of American broadcasters to shell out £2bn for the Premier League rights for the next cycle, can be attributed to the growing interest in the sport stateside in the run up to the 2026 World Cup and aided by having more and more stars on the European stage.
Scott Rosner, Professor of Sports Management at Columbia University in New York told the ECHO: "The maturation of the US football market has been steady over the past 25 years. The genesis of it was hosting the World Cup in '94, the launching of our own domestic league, the MLS in '96, and it staying around past the first 10 years which some people questioned as it has established itself among the US sports firmament."
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