The protracted dispute between Ligue 1 and sports streaming service DAZN has finally reached its conclusion. The resolution involves DAZN paying a hefty termination fee of €100m to Ligue 1. This development leaves the French league with two options - finding a new broadcast partner or venturing into direct-to-consumer (D2C) services.
DAZN's contract with Ligue 1 was terminated after just one season. Previously, the French league had sold most of its domestic TV rights to DAZN for an impressive €325 million per season, spanning from 2024 to 2029. However, this partnership proved unsustainable for both parties.
DAZN's subscription numbers fell short of expectations, making it difficult for them to justify their investment in the deal. Despite having half a million subscribers on their Ligue 1 service, they needed three times that number to break even. Moreover, DAZN claimed that the league wasn't doing enough to combat piracy issues which further impacted their revenue stream.
Impact on Ligue 1 and future expectations
This abrupt end comes at an unfortunate time for teams in Ligue 1 who have reportedly accumulated losses around €1.2 billion due in part to overspending on players in pursuit of sporting success.
Furthermore, it is expected that any future rights deal will be less lucrative than the previous contract with DAZN due to these financial constraints and recent broadcasting failures.
This isn't the first time that a broadcaster has prematurely ended its contract with Ligue 1 either; during the course of the last five years alone this has happened twice before. In fact, during the season of 2020/21 another deal worth €1.15 billion per season with Mediapro fell through. Amazon Prime and Canal+ subsequently picked up the rights, but for 50% less than the original Mediapro deal.
D2C option
The French football governing body, LFP, now has to consider its options moving forward. One of these includes setting up its own D2C service. Interestingly, DAZN has proposed that its termination fee be invested in this venture.
Should Ligue 1 decide to go down this route, it could potentially add another feather to DAZN's cap as they could include the Ligue 1 D2C service in their list of OTT platforms distributed.
While the termination of the contract between Ligue 1 and DAZN marks a significant setback for both parties involved, it also opens up new possibilities for how sports broadcasting might evolve in future years.
