Heated KLPGA Tour Broadcast Rights Battle... Will Prices Soar?

2023~2027 KLPGA Tour
Broadcast Rights Operator to Be Selected Next Month

[Asia Economy Reporter Lim Hye-seon] With the surge in golf participation among the 2030 generation, competition for broadcasting rights to the Korea Ladies Professional Golf Association (KLPGA) Tour is expected to intensify. It is anticipated that companies including CJ and Coupang will enter the fray, causing the KLPGA broadcasting rights fees, which were previously contested between SBS Golf and JTBC Golf, to soar to at least 10 billion KRW annually.

Broadcasting Rights Battle: Will OTT Platforms Join?

According to KLPGT, the organization managing the KLPGA Tour, the operator for the tour’s broadcasting rights for five years from January 2023 to December 2027 will be selected on the 12th of next month. The bidding method will be a restricted competitive tender. The selected operator will be able to conduct broadcasting content business and resale business for the regular tour, Dream Tour, Jump Tour, Champions Tour, and others. KLPGT stated, "We will select a business operator that can enhance brand value and increase KLPGA awareness through the broadcasting rights business."

Interested bidders include SBS Golf, JTBC Golf, Coupang (Play), CJENM (tvN·Tving), and Aclla (SPOTV). Not only the existing operators SBS Golf and JTBC Golf (2007?2014) but also cable and OTT platforms are entering the ‘broadcasting rights battle.’ CJENM expanded its domain by launching the sports specialty channel ‘tvN Sports’ in May. The sports content provided by tvN Sports includes domestic representative matches, Bundesliga soccer, Australian Open, French Open tennis, swimming, and more. Especially, as the host of the PGA Tour CJ Cup and a sponsor of players, CJENM has recently shown interest in golf broadcasting. Moreover, the highly popular exclusive KLPGA broadcasting rights, in cooperation with OTT platform Tving, present an attractive opportunity to transcend platform boundaries and evolve into a ‘sports entertainer.’ Coupang Play, which has raised its profile through sports broadcasting, cannot afford to miss these rights. Aclla, which purchased the broadcasting rights for the English Premier League in Korea and Japan for 75 billion KRW (56.7 million USD) annually, is also looking to create a golf channel and acquire broadcasting rights.

SBS Golf operated the KLPGA Tour broadcasting rights from 2017 to 2021. The contract, extended by one year due to the COVID-19 pandemic, ends this year. Interest in KLPGA broadcasting rights has intensified over the past decade due to players’ performances and the growth of the golf industry. For SBS Golf, which holds broadcasting rights for golf tournaments beyond just the KLPGA, this is a matter of survival. JTBC Golf is also expected to exert full efforts to regain the lost KLPGA broadcasting rights. Their biggest threats are financially strong CJENM and Coupang. Regarding this, CJENM stated, "Unfortunately, we understand that we will not participate in the bidding."

At Least 10 Billion KRW Annually?

With increased KLPGA recognition and fierce competition, broadcasting rights fees are expected to skyrocket. Until 2013, the annual broadcasting rights fee was around 1 billion KRW but jumped to 4.5 billion KRW in 2014. From 2017 to 2021, the annual fee rose to 6.5 billion KRW. Especially after the COVID-19 pandemic, the golf population has grown, expanding the golf market. According to the Korea Leisure Industry Research Institute and others, the number of people enjoying golf domestically reached 5.15 million, a 33% increase compared to 2017. With more participants in the bidding, the industry expects the broadcasting rights fee to exceed 10 billion KRW this time.

As competition for sports broadcasting rights intensifies, prices automatically soar. In professional baseball, the Korea Baseball Organization (KBO) signed a 5-year contract worth 110 billion KRW (average 22 billion KRW annually) with a telecommunications and portal consortium through public bidding in 2019 for wired and wireless (new media) broadcasting rights. This was more than double the contract amount from 2014 to 2018.

Overseas, OTT companies are turning to killer content sports, causing major league broadcasting rights prices to surge. The U.S. PGA Tour signed a 10-year long-term contract with CBS and NBC in 2020 worth approximately 8.53 trillion KRW, a more than 70% increase from the previous contract. FOX purchased the U.S. broadcasting rights for golf tournaments including the US Open from the United States Golf Association (USGA) for 12 years at 123 billion KRW (93 million USD) annually. The Saudi Arabia-backed Golf Super League is reportedly negotiating with Netflix for 661.5 billion KRW (500 million USD) annually.