New Television Deal for Argentinian Football Raises Questions

New Television Deal for Argentinian Football Raises Questions

Matt Hawkins –

Change is coming to the way Argentinians watch their football on television. Last Tuesday, the Asociación del Fútbol Argentino (AFA) announced that a joint bid between US-based media-conglomerates Fox and Turner won the broadcast rights.

The deal, worth ARS$4.4 billion (US$285 million) per year for five years with an option for five more years, comes after the government last year announced its plan to terminate the Fútbol Para Todos (Football For Everyone, FPT) agreement. Fox-Turner beat out stocking-horse bids by ESPN and Spain-based MediaPro.

With a broadcast agreement now in place, AFA officials hope that the financial boost will help bring stability to the beleaguered league and association. While the decision to go with Fox-Turner does not come as a surprise, several questions should be raised about both the process and how football in Argentina will be affected.

The deal is viewed as a significant component of Fox and Turner’s broadcast plans in the region. Fox Sports, with three cable channels in Argentina, is already a market leader in South America, owning the continental rights to the Copa Libertadores and several international rights for the Primera División. It is widely expected that Turner, which owns several global television channels, including CNN and the TNT brands, is expected to launch its own South American sports channel.

Argentina’s television deal could include an online package

La Nación has reported that Fox-Turner intends to sell a cable-only monthly package for every match priced at ARS$300 (US$19) starting in August 2017. Future plans to launch an online package in 2018, allowing subscribers to watch matches on their cellphones, tablets and computers, is rumoured to be in the works. Early reports have suggested this “Netflix for football” will be sold for ARS$600 (US$38) per month.

The high price of the online-only subscriptions reflects an effort by Fox-Turner to avoid undercutting its partnered cable providers. Such an admission reveals the complex political-economic entanglement of Argentina’s communications and media companies.

While it is possible that Fox-Turner will announce lower prices closer to the launch date to placate fears of financial inaccessibility, this is not the first time that Argentina’s football has been placed behind a pay-per-view wall.

From 1992 and until 2009, broadcast rights were owned by Televisión Satelital Codificada (TSC), a partnership between Torneos y Competencias (TyC or Tornoes) and Argentinian media-conglomerate Grupo Clarín.

TSC’s Fútbol de Primera cable packages were viewed as prohibitively expensive for millions of Argentinians. Many, who were unable to afford cable television, would wait until Sunday night to see the over-the-air highlight package that included all the weekend’s goals. A football on the radio culture developed for fans unable to watch their teams.

TSC’s domination of football came to an end in 2009 when AFA withdrew from the deal and entered into an agreement with the Argentinian government. Initially worth ARS$720 million, the FPT program guaranteed free over-the-air access to every single football match. Private over-the-air channels, unwilling to compete against football, were free to rebroadcast matches.

The FPT television deal stabilized the league financially

At that time, Argentine football faced mounting debts. The FPT plan financially stabilized the league and facilitated Argentinians’ access to football. The government argued that football was part of Argentina’s cultural patrimony. It was also seen as a political blow against Grupo Clarín who had developed an acrimonious relationship with the government.

Many critical sectors labelled FPT’s use of advertising time to promote government programs as propaganda. Private channels were also prohibited from selling paid-advertising during matches when audiences were biggest. The failure of FPT to develop revenue streams is one reason for its demise.

By the end of the contract, FPT was worth over ARS$1 billion and was distributing live matches of the Primera and Primera B over the air and online through its YouTube channel. The logic of spending public money on football, however, was increasingly criticized as Argentina’s economy turned towards recession in 2015.

The cancellation of FPT, however, broke a campaign promise made by Argentina’s current President Mauricio Macri. Soon after winning in November 2015, Macri’s government signalled that they were looking to back out of the agreement and transfer broadcast rights for both the Primera and Primera B to the private sector.

2016’s Primera B matches were picked up by the cable-only TyC Sports, while matches featuring Argentina’s five largest clubs (Boca Juniors, Independiente, Racing Club, River Plate, and San Lorenzo) were transmitted exclusively by one of three private channels: América, El Trece, and Telefe. Government officials argued that this complied with their campaign promise to ensure free over-the-air access to football, though it significantly weakened FPT’s ability to court private sponsorship.

The government can no longer afford FPT

Faced with decreasing government revenues, in part caused by the general economic downturn in South America, as well as the neoliberal policies of the Macri government and the failure of the over-the-air broadcasters to find sufficient advertising partners, in late 2016, it became clear that the government’s preferred solution was to withdraw completely from FPT. The abrupt end of FPT cut off one of AFA’s largest revenue streams.

Simultaneously, since the death of AFA President Julio Grondona in July 2014, the Argentine football association has been in the throws of a tumultuous internal conflict over its future leadership. This protracted conflict included an embarrassing 38-38 election result in November 2015 between the candidates Claudio “Chiqui” Tapia and influential television media-personality Marcelo Tinelli. Only 75 people were present to vote.

Marcelo Tinelli poses in front of a badge of the San Lorenzo football club during the club's presidential election on September 1, 2012. (ALEJANDRO PAGNI/AFP/GettyImages)

Marcelo Tinelli poses in front of a badge of the San Lorenzo football club during the club’s presidential election on September 1, 2012. (ALEJANDRO PAGNI/AFP/GettyImages)

In a special assembly of AFA’s constituent club presidents at the end of February this year, new elections for AFA president were announced. Controversially, it was agreed that the Presidential candidates would be vetted by the Colegio Público de Abogados (Public College of Lawyers). Boca Juniors President Daniel Angelici, who backs Claudio “Chiqui” Tapia on a unitary list, is currently the college’s Vice-President. Under normal circumstances, Conmbeol’s ethics committee vets presidential candidates. Both Conmebol and FIFA, in the wake of the decision, have voiced their concerns about AFA’s plan. It is widely accepted that victory is a fait accompli for Tapia and his allies, Angelici and Independiente President Pablo Moyano.

With all of this collusion and backroom politics, it is unclear if AFA is truly willing to leave behind their infamous patronage system. What is clear is that neither side of the internal conflict has demonstrated the political abilities of the late Grondona. Instability in football has been exacerbated by the financial state of many Argentine clubs.

Several factors, including corrupt leadership, increasing player contracts, AFA’s general financial problems, and pressures on institutional revenues have left many clubs in debt to players and creditors.

Economics in football reflect economics in Argentina

Economic issues in football reflect the wider economic situation of Argentina. Of the population,32.9% are now living in poverty, 6.9% in abject poverty according to a study by the Universidad Católica de Argentina. Many Argentinians have been hurt by rapid inflation and cuts to subsidies on electricity, water, and transportation. The government’s economic policies have failed, so far, to produce the promised growth as more than 230 000 jobs have been lost since the change in government. Public sector jobs, in particular, have come under attack.

Smaller football clubs face particular problems. Many such clubs had increased their player budgets in the hope of joining and staying in the 30-team Primera. Now they and their fans have been hit hard by the country’s economic situation.

The March 3 restart to the 2016-17 championship was delayed by one week when players went on strike over unpaid wages while clubs waited for the final transfer of ARS$300 million as part of FPT to be processed through AFA. In the coming four months, 240 matches will need to be played to finish the 30-team tournament.

The backroom deals contribute to a murky swamp of connections between media companies, football politicians, and political parties. One journalist for La Nación earlier this month wrote, “Because Turner is Time-Warner. Time-Warner is AT&T. AT&T is DirecTV. DirecTV is Torneos. Torneos is TSC. TSC is TyC Sports. TyC Sports is Clarín. And Clarín is Cablevisión.” Powerful media relationships in Argentina form a closed loop. The current government’s favourable relationship to the Grupo Clarín is well-known.

TSC has reappeared in the Fox-Turner deal with AFA. Earlier in the week, Un Caño, an independent magazine, revealed that TSC agreed to withdraw its court case against AFA over its cancelled 2009 broadcast agreement if Fox-Turner was awarded the contract. This deal all but guaranteed that similarly valued offers by ESPN and MediaPro would be rejected. TSC will become the production company for the new Fox-Turner deal.

The two major cable providers in Argentina are DirecTV, owned by US-based AT&T (soon to be owners of Time-Warner and Turner), and Cablevisión (owned by Grupo Clarín). TSC’s connection to Traffic and the FIFA scandal should also raise alarms.

How will the new television deal affect the politics and economics of football

Argentina’s economic reality raises questions about how the Fox-Turner deal fits into and affects the political-economy of Argentinian football. The new television deal is a significant increase in the amount of money which the incoming President will be able to distribute to the clubs. For Fox and Turner, making money will require both a sizable number of subscription packages, as well as a particular audience attractive to advertisers.

This likely will bring Fox-Turner and the cable providers into competition with the clubs for fan’s money. With a subscription fee similar to the monthly fee paid for club membership, some fans maybe forced to choose between the television package or their club.

Clubs that depend on their membership base will be the most threatened by this new reality. Ensuring fans’ access to football will be an important issue going forward.

Argentina's President Mauricio Macri is insistent that the government cannot afford to pay money towards to the FPT television deal. (JUAN MABROMATA/AFP/Getty Images)

Argentina’s President Mauricio Macri is insistent that the government cannot afford to pay money towards to the FPT television deal. (JUAN MABROMATA/AFP/Getty Images)

Greater influence over the Primera may help Fox and Turner market the Argentinian league internationally. Storied clubs like River Plate and Boca Juniors as well as a plethora of intense rivalries (matches between Newell’s Old Boys and Rosario Central or La Plata’s Estudiantes and Gimnasia arguably lead to more impassioned battles than the widely recognizable clasicos of the grandes) provide Fox-Turner with great narrative content from which they can market the league. On the other hand, Argentina will need to stem the flow of some of its talent. Increased interest in Argentine players from teams in China, Liga MX, and the MLS have only added to competition in the hungry European player market. Potentially more worrisome for the quality of the league, however, has been the loss of some of the Primera’s best managers.

Beginning in the 2017-18 season, the Primera will begin reducing the number of teams in the first division through an unbalanced promotion-relegation by 2 teams each year. By 2019, the league will reach a more manageable 22 teams. This is good news for Fox-Turner, as the current format of the Primera suffers from a competitive gulf between the top and bottom of the table, with too many matches that are not attractive for the casual viewer.

Regardless, Argentinian football, and its fans in particular, have proven to be resilient in the face of the cyclical pressures of the national economy, the machinations of football’s self-interested leadership, and the business of global football. There is enduring strengths to Argentina’s player development system which continues to produce exciting young talent, as well as the rich heritage of the country’s football culture. Combined, these realities make Argentina’s Primera División a very attractive product for television audiences around the world.

Matt Hawkins is a PhD Candidate in Anthropology at Carleton University, Ottawa. His research covers the intersections of football and politics in Argentina. His dissertation focuses on the Return to Boedo campaign by supporters of Club Atlético San Lorenzo de Almagro. He writes infrequently on supporter culture for and can be followed on Twitter @mhawkin2