The weak are meat and the strong do eat

The (expected) news finally comes: K+ has successfully held the right to broadcast EPL (English Premier League) in Vietnam territory. To most people who do not pay much attention to the football world, it is such a normal news because they believe that they can always easily watch football every weekend as they have done for the last many years. However, things have changed much since Vietnam is joining the world market.

Seven years ago, we had the right at only $ 4 million. In 2009, we watched football with the cost quadrupled, $ 19 million. Now, the price has skyrocketed to $ 40 million. Though the GDP of Vietnam has positively risen through out that period, such an increase of price is still unacceptable and unbearable to most people’s opinions. The first time people heard of the fact that an American company had bought the right to monopoly broadcast ELP in Vietnam and they only transferred that right at only at least $37.5 million, many stated firmly that we did not have to buy it at any cost, and we did have many other matches to watch instead of EPL. And now when K+ finally got the transfer, most of us start to blame it for being selfish and foolish.

Does K+ deserve that?

Many people blame K+ for raising the cost of broadcasting EPL in Vietnam. They believe that by monopoly negotiating with MP&Silva, the company holding the EPL TV rights in Vietnam for the last 3 years, in order to dominate the market, K+ had given the world good reasons to increase the price. In fact, no matter K+ did negotiate with MP&Silva or not, the price had already increased dramatically. MP&Silva had to pay $13 million to own the right. The world has no longer seen Vietnam as a country walking out of the war, living in poor. Vietnam now in other people’s eyes is a big market of population over 80 million with income rising steadily day by day. Many of us are buying luxury cars and modern smartphones. Furthermore, Vietnam is famous for its passion for football, which can easily be acknowledged by observing the atmosphere every time the national team plays. When the world realized that there was a huge demand for football in Vietnam, nothing can stop the price from increasing. Besides, K+ at that time was a new player, and the only way to compete in a very crowded play ground was to have a better and unique weapon. And that was EPL. The only mistake that K+ made 3 years ago was that it had not cooperated with other channels to have a better price.

That was the story of 3 years ago. The recent story is not very much different. K+ is still the only one that can own the right to broadcast EPL. The price is much higher, doubled from the previous one. Many people cannot accept the fact that a company whose 51% of share is from the government pays more than 1000 billion VND just to dominate the market while it can get a better price if it cooperated with other ones. There are 4 parts that needs regarding: 51% of share from government, 1000 billion VND cost, better price and cooperation.

First, it is true that 51% of share of K+ is from VTV, which is a government enterprise. And it is also true that the other 49% is from a foreign partner. When K+ was negotiating about the broadcasting right, VTV had no idea, which means the whole transaction was done by the foreign 49%. The money was paid by Canal – the foreign partner, not K+. With 51% of share, VTV has all the means of preventing the transaction, but it has done nothing. It raises a question about whether VTV really wants to have the broadcasting right or not.

Second, $40 million. Many people argue that with $40 million, we can build many schools and hospitals which are very scared recently. Such argument reminds me of years ago, HCM city authority planned to cut down the annual new year celebration firework and give that money to the poor. The plan did not work out because the people wanted to see the firework more than giving to the poor. They said that though the right thing was to give gifts to the poor, the firework was more important as it could help raise the spirit for the new year. The firework is only 15 minutes long. The EPL is undoubtedly a much bigger spiritual dish. Some may complain that EPL is very bad dish because it brings some social evils such as gambling. However, everything has 2 faces. EPL is among a very few things that can bring people together on Sunday and Saturday night. I still remember 3 years ago, when K+ got the right and people claim to stop watching football, there were some concerns that it would lead to other problem such as street racing, … Luckily, it has not happened because people are still able to watch football in one way or another. Back to the figure $40 million, it is inarguably a huge number. It equals nearly 1000 billion VND. Our population is more than 85 million. Then, it means each of us will pay nearly 12,000 VND or half a dollar to watch the most exciting football league in the world in 3 years. Is it cheap or expensive? I will let you answer the question. Just consider this fact: in Thailand, the right to broadcast EPL in the next years cost 8 times more than Vietnam.

Third, a better price. People believe that if there had been a co-operation, there must have been a better price. Indeed, no one could guarantee that a co-operation could lead to a better price. IMG had bought the right at the cost of $37.5 million. And I see no reason why they would buy it at a lower price.

Fourth, co-operation. Like 3 years ago, this time K+ was not invited by VTV to discuss about the EPL broadcasting right. I could not understand why that happened. Everyone knows that K+ is the only company together with VTV that is able to buy the TV right. VTV made a bad move, now it is suffering from it. K+ has nothing to be blamed.

In business, no one wants to be a fool. No one wants to buy high and sell low. No one wants to be left behind because of the normal emotions of the public. And neither does K+. It absolutely does not want to buy the right at such a high cost. But it has to. 3 years ago, it promised with new user the right to watch EPL with high quality. Now, if it could not get the right to broadcast EPL for the next 3 years, it would fail to complete its promise. Users will abandon K+ and even sue it. It has nearly no choices but to buy the right at any cost. We could have saved lots of money, but we have turned that opportunity down for some unknown reasons.

Everyone likes talking about free market mechanism. And when there is a move, everyone is discouraging it. Indeed, the society needs K+, the one who dare to dream and dare to do.

And if you wonder how K+ could survive for the last 3 years while everyone dislikes it, you can take a look at the coffee shops and hotels around you. There was no monopoly. Just the weak are meat, and the strong do eat.

In business, business is business.

Kz and Inor.