Crossing into the box

If Sky does not play ball, Man United might start its own TV channel. Patrick Tooher reports

WHEN Manchester United's Eric Cantona volleyed home the winner in last Monday night's top-of-the-table clash at Newcastle United, it was not just the spirits of the club's Old Trafford faithful that were sent soaring.

Cantona's strike not only took his team to within a point of the top slot, prompting bookmakers to install Manchester United as the new title favourites. It also sent shares in the publicly quoted company to a new all-time high of 284p - a rise of more than 40 per cent this year alone.

The improved prospect of a lucrative Uefa Champions' League campaign next season was the most obvious reason for a renewed buying interest. But what really intrigued investors were stories that Manchester United is looking into the possibility of establishing its own television channel. Such a move could lead to a dramatic re-rating of the company's shares, given the City's current love affair with anything media.

The speculation forced the club to take the unusual step of announcing it had "no firm plans" to establish its own TV station before adding that if the big broadcasters were by-passed: "The money potential is tremendous but there could be potential difficulties."

At the moment, TV rights to matches are negotiated collectively by all 20 Premier League clubs with satellite broadcaster BSkyB. Under the terms of their pounds 305m, five-year deal, revenues are divided on a more or less equitable basis. While the pounds 2.9m Manchester United received last season was the biggest in the Premier League, it paled into insignificance compared with the pounds 23m generated last year from merchandising activities such as the sale of replica kits, videos and other branded goods.

With the BSkyB deal due to expire at the end of next season it is hardly surprising that Manchester United has been busy investigating ways of maximising income from television.

A year ago the club began a feasibility study into exploiting its strong name by setting up its own dedicated TV channel. It concluded that the costs associated with going on to satellite would be too expensive, but teaming up with one or more cable operators to offer exclusive access to live home games was a definite starter. In particular, the survey found that the club had more than 2 million fans - and therefore potential subscribers - in the UK alone, who would also provide a ready-made market for off-the-field marketing such as direct mailing to boost sales of club products.

During the summer close season, when fans and fund managers alike were fretting over the sale of three of its best players - Mark Hughes, Paul Ince and Andrei Kanchelskis, United reportedly made a preliminary inquiry to the Independent Television Commission, the commercial broadcasting regulator.

Plans to go it alone received fresh impetus when the Office of Fair Trading said it was looking into the possibility that the Premier League's deal with BSkyB could be judged a cartel.

"United could do nothing on their own under the existing contract with BSkyB. Other clubs would block them," says a source close to the television negotiations. "The chance of MU-TV happening is very small."

But the club could earn even more by sticking with the Premier League but televising games on a pay-per-view basis.

For example, it is estimated that last Monday's thriller could have generated pounds 30m alone in TV revenues - more than 10 times the amount either club earned from TV fees in the entire 1994/95 season. The forecast assumes 3 million armchair viewers would be prepared to pay just less than pounds 10 a go - not unreasonable given that the price of the cheapest ticket for the Newcastle game was pounds 13.

How all that money would be distributed under a pay-per-view system is unclear but, as we report on page 3, the top clubs will be feasting from a much bigger television cake next time round.

And if the clubs fail to agree a formula, Manchester United is ideally placed to take part in another sure-fire money-spinner - an extended European Champions League.

Whatever the outcome, television seems destined to become Manchester United's most significant income stream over the next few years "It's a goldmine," says Richard Kurt, who run the club's independent supporters' association.

As for investors, so long suspicious of quoted clubs, they are only now coming to terms with the strength of Manchester United's unique franchise.

Rumer was diagnosed with bipolarity, attention deficit hyperactivity disorder and post-traumatic stress disorder: 'I was convinced it was a misdiagnosis'
peopleHer debut album caused her post-traumatic stress - how will she cope as she releases her third record?
A long jumper competes in the 80-to-84-year-old age division at the 2007 World Masters Championships
FootballGerman sparks three goals in four minutes at favourite No 10 role
Arts and Entertainment
'New Tricks' star Dennis Waterman is departing from the show after he completes filming on two more episodes
tvHe is only remaining member of original cast
Lewis Hamilton will start the Singapore Grand Prix from pole, with Nico Rosberg second and Daniel Ricciardo third
F1... for floodlit Singapore Grand Prix
Life and Style
Walking tall: unlike some, Donatella Versace showed a strong and vibrant collection
fashionAlexander Fury on the staid Italian clothing industry
Arts and Entertainment
Gregory Porter learnt about his father’s voice at his funeral
Arts and Entertainment
tvHighs and lows of the cast's careers since 2004
Life and Style
Children at the Leytonstone branch of the Homeless Children's Aid and Adoption Society tuck into their harvest festival gifts, in October 1936
food + drinkThe harvest festival is back, but forget cans of tuna and packets of instant mash
New Articles
i100... she's just started school
ebooksAn unforgettable anthology of contemporary reportage
New Articles
Life and Style
Couples have been having sex less in 2014, according to a new survey
Arts and Entertainment
musicBiographer Hunter Davies has collected nearly a hundred original manuscripts
New Articles
i100... despite rising prices
Holly's review of Peterborough's Pizza Express quickly went viral on social media
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam