Stepan Shcherbachov: "UAF and UPL openly produce new conflicts and turn broadcasters, clubs and fans against themselves"

Who has the right to dispose of television rights, which are claims to the Ukrainian Premier League, how the Ukrainian audience has changed due to the war in Ukraine, and how high the audience's interest in sports events is today, read further in the material. Stepan Shcherbachov, the head of sports projects management of the 1+1 media group, spoke about the company's position in connection with the conflict that arose over the television rights to show matches of five Ukrainian football clubs.

— Stepan, we want to explain to an ordinary fan the reasons for the misunderstandings that are happening now because of the television rights to broadcast football matches of the Ukrainian championship. What is the position of the 1+1 media group?

— The position of the "1+1 media" group remains unchanged - we absolutely legally own the rights to broadcast home matches of the clubs "Dynamo", "Dnipro-1", "Zorya", "Metalist", "Rukh", because we act on the basis of concluded contracts . Some of them were signed back in 2017-2018 and are valid for 10 years. These contracts have not been terminated by any of the parties, they are still valid. Medigroup does not sign contracts without understanding the future strategy, constantly analyzes the situation and adjusts its actions.

Therefore, as a responsible company, understanding the complexity of the current situation in the country, we believe that charging for this kind of content is, to put it mildly, inappropriate. According to preliminary statistics, up to 40% of Ukrainians lost their income, some lost their homes, people were forced to flee the war, so not everyone can afford even minimal expenses.

The specified football clubs transferred the TV rights to the "1+1 media" group absolutely free of charge. This step on their part is quite understandable, because it is now extremely important for clubs to be closer to their audience, to keep it and to expand it even more. Today, it is necessary not to close such content, but, on the contrary, to allow more viewers to watch and to be distracted from constant news.

Here, for example, in Great Britain, the Premier League is broadcast by three broadcasters to satisfy the interest of all fans. The rights were sold for £4.8bn to broadcasters Sky, BT and Amazon. Of the 380 Premier League matches per season, 200 are broadcast live.

— It was noted that, in addition to free distribution, our group invests its own funds and resources in the creation of additional content. What is it about?

— "1+1 media" really invests its own funds in the production of additional content. This is our civil position, despite the fact that making a TV picture is a rather expensive pleasure.

In addition to the production of sports events, which, by the way, "1+1 media" has been doing for a long time and with high quality, we have our own sports resources "FootballHub" and "ProFootbol Digital", which have gained a considerable audience. They are worked on by a team of sports journalists, commentators, cameramen who help viewers become closer to the football world. For example, FootballHub has an audience of over 500,000 subscribers and is completely free on Youtube. In contrast, Setanta only has 85,000, so the difference is still noticeable.

— But now YouTube channels "1+1 media" do not broadcast matches?

— Yes, this is a temporary forced step. The Ukrainian Premier League decided to start resolving the conflict with destructive actions. UPL started going on strike, complaining and blocking our content. Now our partners from FC "Rukh" have received a similar ban. These are all reckless actions, because "1+1 media" can legally prove itself and is already doing so. We have legal rights, legal partners who, in turn, have the right to dispose of their rights, as they have done. Therefore, broadcasts will appear again on our resources soon.

Football in wartime should be free, spectators should see it. Today we are not fighting for 50 cents or 90,000 dollars, we are fighting for football fans to be able to watch the matches of their favorite teams. We are in favor of collaboration with our partners and will distribute as much content as possible, all of which will be available on "FootballHub", "ProFutbol Digital" absolutely free of charge.

— The other day, there was news that the Pechersk Court forbade UPL and UAF to block broadcasts on YouTube channels and to apply any monetary and sports sanctions against football clubs that are going to broadcast their home matches on their own. Will this decision help to avoid further problems and how will it affect the contract that UPL concluded with Setanta?

— Of course, this will have an impact, because first of all they will be prohibited from going on strike, and the YouTube channels of the clubs and projects of the "1+1 media" group, "FootballHub" and "ProFutbol Digital" will continue to work quietly and will get rid of blackmail, giving fans the opportunity not to lose the connection with the world of football. All documents have been sent to YouTube for review, we are waiting for a response within the established time frame.

Other than that, this court decision is a pretty clear step that makes it clear that someone is a bit wrong in this case and still prompts you to start thinking differently and motivates a change in approach. "1+1 media" is completely confident in its position, because we have agreements, we understand who is the right holder, what are our obligations and who are our partners.

How this will affect the contract between UPL and Setanta, I cannot say for sure. They may continue their confrontational stance, but the court ruling confirmed the fact that we have the rights to these broadcasts. The fan is our priority right now, so we will continue to give our viewers the opportunity to see what they want.

— If we return to the decision of the UPL, they state that, according to their decision, the Setanta television company has become the only company that has permission to broadcast matches of Ukrainian football clubs. However, UPL did not take into account the reluctance of five football clubs to participate in a single TV pool. Why was this decision of football clubs ignored by the UPL and not taken into account?

— About why the wishes of football clubs were ignored, you should ask the management of the UPL and its executive director Yevhen Dyky. In my personal opinion, UPL has serious systemic problems in management, strategy development and, in general, in understanding its mission, because globally they are stuck in decade-old narratives. Unfortunately, this is a systemic flaw that pops up in the Premier League every time they try to do something.

They do not try to resolve conflicts, but only deepen them. For example, the main issue is the issue of rights. The broadcasting rights are owned by the clubs themselves, as according to the Law of Ukraine on Sports, Clause 8 of Article 45 states: "The owners of the rights are the organizers of the competitions." According to the regulations of the Premier League itself, the organizer of the competition is the host club, and the clubs themselves finance the team and bear all the costs, and this is how it is established all over the world. Even if you remember "Barcelona" and "Real", which did not transfer the rights to the Spanish LA-Liga for 10 years, and did it only three years ago, but did not give them away, but sold them for hundreds of millions of euros.

Also, if you recall the history of La Liga that year, which at that time purchased the rights from all clubs and decided to sell 10% of its own business to the investment fund CVC for 2.7 billion euros. When "Barcelona" and "Real" learned about this agreement, in the negotiations of which they did not participate, they clearly said: "We do not agree. These are our TV rights, and the agreement was concluded for 50 years." So, in conclusion, La Liga cannot transfer its own 10% without the consent of its rights holders. This is how it should work.

— Internal problems of the organization of the work of the UPL were mentioned quite often, due to which similar situations periodically arise. What exactly is it about, how can you really avoid such problems in the future, and what steps should be taken for this?

— I have been working with UPL since 2010, so I had time to talk with various of its teams, but one key problem always remained: UPL cannot fulfill its main task - to fill the budget of football clubs with money, and that is precisely what the Ukrainian Premier League was created for. What are the results of UPL's work as of today? The Ukrainian championship has become cheaper 10 times, that is, if it used to cost 15 million dollars, now this amount is 1.5 million dollars.

The reason is that advertisers' interest in the Ukrainian championship has decreased, only bookmakers remain. Simply put, UPL is doing everything to build ultra-niche football in Ukraine, in which there will be a small audience core of 300-400 thousand paid subscribers, and everyone else will not see matches and will simply forget about football. This is the popularization of sports.

Yes, indeed, there are users who are used to paying for sports content, but they are not the whole country. If you recall Oleksandr Usyk's fight, which we broadcast thanks to the fact that Usyk gave the rights to the 2+2 channel for free, his fight was watched by about 16 million Ukrainians, which is not compared to 150 thousand users who buy a subscription to watch sports events.

— If in wartime sports content becomes available only by subscription, can we forget about the development of Ukrainian sports?

— Judging by the current UPL strategy, yes. If even a paid platform can get 200-300 subscribers, then the Premier League itself will never have the money it needs to grow the sport. The lion's share of money in the budgets of football clubs comes from advertisers, and they will not be interested in cooperation, because they need real viewers, they want to understand who this viewer is, how old he is, where he lives and so on.

Currently, Ukrainian clubs that agree to the terms of the UPL deprive themselves of the opportunity to sell normal advertising and lose sponsors, because the matches of these clubs are seen by a critically small number of people. This is a vicious circle that needs to be broken. And now is the best time for the UPR to make the necessary reforms. Today it is impossible to make money from Ukrainian football, on the contrary, you need to work with the domestic football audience, expand it, remind that football is cool and interesting. Television ratings are growing today, people are interested in watching matches of Ukrainian teams, so it is necessary to open and not close the door to everyone who does not want or cannot pay.

— How high is the interest in sports among the Ukrainian audience today, for example, the share of watching the match "Zorya" - "Dynamo" was a record 21.2%. Are fans of the sports world waiting for the return of domestic sports events to the television screens? What can you say based on the TV ratings and Digital projects of the 1+1 group?

- We recently compared TV viewing figures for a number of Champions League, Europa League and Conference League qualifying matches. So, the share of the match "Dynamo" - "Fenerbahce" was higher than 22%, while at Setanta it was 0.2%. And this is in view of the fact that we were leaving 15 minutes later according to the terms of the signed agreement. Also, the share of watching the Dynamo-Sturm match was about 20%, and 5% on the paid platform.

Interest is definitely there, people watch football, and this is what the organizers of Ukrainian football should use, because they have a historic chance to raise interest in this sport thanks to the events that, unfortunately, are happening today in our country.

— If we emphasize the important points once more, then who has the right to dispose of their rights and what is the role of the UPL and UAF in this?

— First of all, only football clubs can dispose of the rights of football clubs. In order to obtain these rights, today the UPL exerts some pressure: "We will not certify you if you do not agree that the rights belong to us." And, accordingly, some clubs sign some papers at the beginning of the season where they agree to a pressure review.

The first team of the UPL did the right thing, because in 2008, the Premier League signed agreements with each club, in which, for example, "Dynamo" transferred the rights under certain conditions. Civilized rights can only be obtained through an agreement, not through a threatening letter that says: "If you don't want to transfer the rights to us, we will fine you or not certify you."

What we see now is that the UPL is not only not going to compromise, but on the contrary is trying to add extra problems. For example, on September 3, they set two matches: "Zorya" - "Dynamo" and "Dnipro-1" - "Veres" - at the same time, at 1:00 p.m. Our partners Sports Club "Dnipro-1" appealed to the Premier League with an official letter, however, they refused to postpone these matches. What is the point of this act, other than a minor foul, as they say in sports? Will 1+1 media suffer from this? No, because we will show one match on "2+2" and the other on the UNIAN channel. The viewer will suffer and will have to choose or run from channel to channel, although this could have been avoided because we had a free slot to show the matches at different times.

Therefore, such a passive position of both the Premier League and the Ukrainian Football Association is surprising - Dykiy and Pavelko are not only unwilling to understand the situation and stand aside, but are openly producing new conflicts and turning broadcasters, clubs and fans against them.

— Finally, why is it important that football matches during the war in Ukraine should be free and accessible to any Ukrainian fan?

— According to a study conducted by an independent agency, 78% of respondents said they were not ready to pay. We clearly understand that in Ukraine today about 40% of people have lost their jobs or incomes. In addition, we see a steady and long-term outflow of subscribers from cable networks and OTT platforms, because people do not have extra money. Why are users unsubscribing from platforms and cable networks? From a good life? No, because they don't have those 100 hryvnias. And it's not even about grandparents, these are adults who could work.

Football is a national sport that has to fight for an audience. There is no business or successful project if there are no millions who will be willing to pay for this content. There will come a time when everyone will pay, but this must happen in peacetime and under normal economic conditions in the country.