Audit inspectors say the continued losses of Cyprus’ biggest digital television service provider, Cytavision, is attributed to the amount of money spent on obtaining TV rights for Cypriot football games.
Despite operational planning aimed at pulling Cytavision on a profitable course for 2011-2016, the Cyprus Audit Services believe that this is highly unlikely and forecast further losses for the coming years.
As the island’s largest subscriber TV service, Cytavision has – since its creation in 2004 – racked up €40 million in content-based losses with €17.6m attributed to 2011-2016 alone.
Teams in the first division are set to rake in over €18m in TV rights from the islands television subscription providers.
- €12m earned in TV rights for Cypriot clubs
- Cyta spending big on football TV rights and sponsorship
- Court orders Cyta to pay €369,750 fine
- This in itself puts Cytavision in a dilemma.
On the one hand, increase expenditure to keep the teams and increase the debt or lose the teams and face a probable loss of subscribers – a phenomenon already in play.
Although Cytavision bosses have decided to reduce operating expenditure by 10% they are considering in pumping an additional €5m into television rights.
Football teams have been buoyed by the competition between Cytavision and other providers such as PrimeTel and Cablenet pushing their demands to new heights.
This in itself is not without logic.
With many smaller teams unable to make satisfactory ticket sales, many of the teams rely heavily on television rights for revenue, and in many cases, it is their main source of revenue.
Cytavision finds itself in a tight spot however for the 2019-2021 seasons which is currently under negotiations.
They have been outmaneuvered by PrimeTel and lost Omonia for €1.9m along with AEK Larnaca. Along with APOEL, Omonia has the largest followers in Cyprus along with bitter rivals APOEL.
Negotiations with APOEL who, with their heightened performance, now demand €3.25 million per year have faltered as have those with Anorthosis Famagusta with Cablenet offering the Famagusta team €1.6 million per year.
Cytavision’s agreements with APOEL and Anorthosis for the 2016-2018 season was €1.9m and €1.6m respectively.
Cytavision, however, does seem to be a close to signing a €9m package deal with the Cyprus Football Association (CFA) for eight first division teams – approximately €1.125m per team.