We should not.
In an all too familiar twist in the local football-content saga, StarHub has come out to announce its latest coup – to broadcast European football on its network once again. Sounds good? Not really.
The problem with this is that StarHub did not actually win the broadcasting rights to the programme. And neither did SingTel. In fact, the exclusive media rights to broadcast European Football were already won by Eurosports many months ago.
Presumably, the local carriers now have another middleman to pay to for broadcasting football content in Singapore. Don’t we all know what happens to the price of products when a middleman gets introduced into the chain?
Going back in history
Seven years ago, when SingTel first announced that it had won the rights to broadcast Champions League matches, football fans were baffled. SingTel were never contenders and hardly anyone was using their pay TV system then. To win market share, it paid top dollar to secure the exclusive broadcasting rights for the Champions League. To continue its one-dimensional strategy at winning market share, it again paid top dollar to wrest the exclusive English Premier League broadcasting rights from StarHub.
This introduction of a newcomer did not herald greater competition or better quality service. In fact, consumers paid more money and received poorer quality content with SingTel’s unreliable content delivery system.
Fans in Singapore were taken by surprise after SingTel decided to raise prices in 2012, in spite of inferior quality services. It has since raised prices from $15 in 2012, when it was broadcasting both the English Premier League and the European games, to $59.90 for just the English Premier League games and an additional $14.90 for European games. If consumers bought a package at a minimum of $66.90, they would get more channels in addition to the two separate programmes.
This goes against the very same foundation of how SingTel intended mio TV to be when it first launched its services in 2007.
Having said those words back in 2007, they now expect consumers to pick packages with their “flexible” pricing.
The situation hardly seems to be improving, considering the pricing package of the 2014 World Cup in Brazil.
What is going to happen now?
From our perspective, we do not see any improvement in the strategy of our content carriers going forward, with SingTel effectively shredding any bargaining power any local carriers would ever have for football content. The latest announcement on pricing for the English Premier League is that SKY and BT have agreed to pay an additional 70% on the current deal in place for the rights to the English Premier League or $10.7 billion.
Logically, if someone is going to pay 70% more for something, they will very likely want to charge a similar percentage increment to its customers – be it SingTel, StarHub, Eurosports or another other syndicates.
If Singaporeans continue to pay for increases in subscription charges, it will just prompt content owners to continue charging more. It is a simple supply and demand equation that we are talking about.
We do not doubt that Singaporeans have the ability to foot a bill of close to $70 or even $150 a month if they are truly passionate about football. The bigger question is, when will this stop?
The only answer we can think of is similar to what we see on commercials for many illegal animal products – when the buying stop, the killing can too. But we are not so sure the die-hard fans in Singapore will be able to stop, so the content carriers will most likely continue to make a killing at our expense.
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