Vodafone’s decision not to renew its soccer rights in Spain next season has preceded a radical bid to quell a decline in service revenue and falling subscriber-base in the country, the telecommunications company has said.
The company, which made the decision to exit Spanish soccer entirely last May, says the move will form part of a major overhaul to its operation in Spain, which saw Vodafone reach an agreement with unions to cut its workforce by 1,000 jobs at the end of 2018.
Vodafone and Orange acquired rights to La Liga, Spanish soccer’s top flight, and the Copa del Rey, the country’s premier cup competition, for the 2016 to 2019 cycle, as part of a joint venture agreed in 2015.
The two telcos also purchased Telefónica’s carriage rights sub-licensed by Mediapro, the Barcelona-based marketing agency, though Vodafone confirmed in July last year that it was cutting its soccer offering ahead of the 2018/19 season, committing to a tailored package including only eight La Liga matches.
While Telefónica remains the major rights holder to domestic soccer in Spain until 2022, Vodafone has moved to reassess its business performance in the market after seeing a slide in user numbers across its TV, broadband and digital platforms.
Vodafone said: ‘Service revenue declined 6.4 per cent, reflecting the commercial actions we took in May in order to improve the competitiveness of our offers, as well as our decision not to renew unprofitable football rights.
‘Following this decision, which led to higher content costs for other operators, promotional discounting increased in the second and third financial quarters, as these rivals sought to win additional football customers.’
In total, Vodafone recorded a drop in 115,000 mobile customers, 123,000 fixed broadband customers and 49,000 TV customers over the past 12 months in Spain, though returned to customer growth in both broadband and TV during the fourth quarter, adding 1,000 and 36,000 customers, respectively.
In April, the company announced a new simplified tariff structure which includes speed-differentiated unlimited data bundles in both mobile-only and convergent offers for the first time, and also launched a new TV offer designed to boost its film and entertainment offerings.
Vodafone added: ‘Content costs declined only modestly during the year as we completed our commitment to offer the eight-match La Liga football package, but will fall substantially next year as we exit football entirely.’