NPFL: Club owners set for crucial meeting with LMC

The NPFL: Between us and our game (Part 1)

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By Fred Edoreh

Recently, the League Management Company engaged club owners for solutions to stably steer the Nigeria Professional Football League (NPFL), post Covid-19 lockdown, but it was greeted with the familiar misinformation attacks by pathological disrupters of Nigerian football who suggest that the only way to advance the NPFL is a return to the old order whose rapacious and ill-conceived deals left the league in squalor until the League Management Company (LMC) came to rescue it.

Inimically praying for the failure of the current broadcast and commercialization partnership with NEXT Digital TV and even calling on club owners “to rise up” against the LMC, they conveniently hid the fact that the old Nigeria Football League Limited (NFLL) ran a transaction in which the league broadcaster paid $5.4m per season to a middleman who only pinched N150m (barely $1m at the time) to the league and its 20 clubs and kept $4.4m as profit.
At a point, the league could no longer fulfill its obligations, including indemnities for match officials, as it revolved in indebtedness to the agent which lent it money just to keep it afloat to enable collection of new season payment from which the old season debts were further deducted from its bare bones.

Even before the first tenure of the TV deal was due, the NFLL jumped to knot the niggardly arrangement till 2022 and moved to further expand the rapacity by considering to award the title sponsorship of the league to same middleman for far lower than what was actually asked of a telecommunications company on pitch. Such was the lowliness with which the NFLL steered the league.

Ironically, because of the possible private benefits its leaders enjoyed from the skews, the tussle for succession became so feisty that the protracted multiple disputes in several courts boomeranged with a judicial declaration that the NFLL was not incorporated correctly, thus unknown to law and therefore an illegal body.

That declaration led the NFF, the clubs and the sports ministry to seek a different legitimate vehicle to save the league. Thus was the League Management Company Limited (LMC) birthed as a non-profit organisation acting in the interest of the participating clubs in the NPFL and also the NFF as is the case with the FA Premier League Limited in the UK, DFL GmbH in Germany, the LFP in Spain and other such bodies in France, Portugal and various European countries.

The NFF and the clubs deliberated extensively on a new governance structure and, with the endorsement of the congress, the supreme governing organ, they settled for a hybrid of several structures from the more developed leagues in which, like in the EPL, the participating clubs nominate their representatives, rotated every football season, while a joint “selection committee” with the NFF appoints an independent chairman and two other independent directors on a four years tenure, to constitute the board. This has ensured stability on the LMC board which thenceforth has operated seamlessly without any rancour including during the seasonal change of club designate directors and or the reappointment of the independent Chairman and Directors for another term.

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The LMC submits its project plans, budgets, calendars, sponsorship deals, funds distribution formula, prize system and media plans for approval by the NPFL assembly (the members) which also approves the nomination of a reputable external auditor to entrench best practices, including the publication of its annual reports and filing of its audited account with regulatory authorities as required by law.

The LMC came into being in 2013 and quickly salvaged the league from the obnoxious transactions of the NFLL by eliminating the middle man and negotiating directly with the league broadcaster to free up the full value of the rights which it raised to USD $8m per season (paid directly to the league), with effect from 2015, but with advance payments to keep the league afloat while it smartly left the broadcaster to fulfill its old contract to avoid encumbering the league with disruptive legal entanglements.

Still, some hirelings with false claims as players representatives wrote to threaten the broadcaster with legal actions if it discarded the old deal for the new one. The broadcaster did not bulge and thus followed a staccato of sponsored frivolous litigations and petitions by chronic litigants whose disingenuous ploys have kept potential broadcast partners and brand sponsors at bay to the detriment of the commercial fortunes of the league.
Over seven different cases with one even at the Supreme Court are still pending while about twenty others have failed or been dismissed by the courts. The renewed attack on the LMC/NEXT TV deal is therefore not a surprise.

Despite the onslaughts, the LMC has resiliently steered the league away from the ugly past in which clubs were tasked to pay participation and players’ registration fees, insurance, provide match balls, pay match indemnities and other charges. Now, the clubs register at no cost and recieve various pay outs and bonuses depending on inflow of revenue while the LMC provides insurance, match day branding, official match balls, media presence, indemnities and various other organisational costs.

This is in addition to ensuring the league is operated on the foundation of a world class Rule Book and framework on club licensing regulations and seamless enforcement and adjudication processes, besides the introduction of Domestic Transfer matching System – DTMS in partnership with FIFA (the first league in Africa to do so) which optimized the transfer system, among several other innovative strategies to move the league forward.

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As it strengthened the broadcast, corporate trust, transparent distribution of funds to clubs and heightened match day experiences to create a boom in match attendance and social media following, Nigerians witnessed and still testify to that revival which reverberated in improved and impressive spectatorships in various centres, from Enugu to Kano, Lagos, Aba, Bauchi, Owerri, Ibadan, Akure and others.

That there has been a lull in the 2018 and 2019 NPFL seasons in terms of payouts to clubs was because the broadcast partner withdrew, not because the LMC dropped the ball but because of exogenous factors like high cost of production logistics and low advertising patronage, not excluding the drop in the value of Naira-To-Dollar and the flux of competitive new technology platforms not distinctly captured in the contract.

In a review of its business strategy, the broadcaster opted for the purchase of only the right to air contents from the league, just like it does with the foreign leagues, closed its league production unit in both football and basketball and cut down on staff, not only in Nigeria but in Ghana, Zimbabwe and Kenya as well.

Seeing how some of the advanced and most glamorous leagues are caving in to financial pressure with just few weeks of disruption in cash flow under the COVID-19 pandemic, it is remarkable that the LMC through forward-looking prudence has been able to sustain the league for two seasons and still maintainrd its high technical standard despite the loss of broadcast revenue.

Challenged to seek alternative strategies to produce the league contents for TV, the LMC found no indigenous Nigerian company with the technical and financial capacity to step in. Even the attempt to partner the national network to fill in the gap failed due to the sorry fact that, for years, there was no investment to boost its capacity.
Part of the problem is that, despite the glorification of the “yester-years,” even when the Naira was at par with the Dollar and Pound, the league system did not bequeath any legacy in critical broadcasting infrastructure, fans and ownership structures nor business, commercial and media framework upon which the present day league should have stood.

Then, fans were only exposed to the local football scene but, today, the competition brought by the foreign leagues is snuffing out the domestic game with higher visibility projected through powerfully funded media and new technologies. Leagues deficient in broadcast, telecommunication infrastructure and funding to propel exposure are condemned to lose their fans and market.

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So, through the years, our league has been groping with handicap in the intense, pitiless competition. Even when the league had TV partners, only one or two matches were transmitted live per match day whereas, for the league to optimise revenue, all ten matches should be on TV.

It has been estimated that Nigeria loses over $200m annually to the foreign leagues through fans consumption of their products and endorsements by local brands. The government should have understood that investment in critical infrastructure to deliver competitive visibility of the league to wide national and global audience brings huge socio-economic benefits through inherent potentials for youth engagement, national mobilisation, enterprise generation, business opportunities, tourism inflow and both foreign direct and domestic investments.

The EPL which has now captured our fans and feasts on our market was jump started in 1992 with a grant of £200m for the provision of critical media infrastructure and stadium upgrade by their government which now enjoys billions of pounds in taxes annually with other valued added to the economy from it.

While, for example, the CAF Champions League rakes in only about $30m annually, Africa should be concerned that the UEFA Champions League taps over €300m from the region alone. With Nigeria as their premium market, the top foreign clubs harvest even more.

Understanding the trend, the Minister of Information, Lai Mohammed, instructively initiated a review of the National Broadcast Code to push advertising and sponsorship support for domestic sports. Even at that, the products have to be available in the right quality, reason why he is also seeking funds to re-equip the Nigeria Television Authority to be able to produce quality, internationally marketable contents and buy rights on sports and entertainment properties to retain large audience, attract advertisements and sponsorships and deliver profit for steady innovations and expansion.

The football family in Nigeria, in a move championed by the LMC leadership has severally taken this message to the Federal Government Economic Management Team (EMT), Nigeria Economic Summit Group, the Central Bank, the Sovereign National Wealth Fund, the organised private sector and even foreign investors through a deliberate program code named “Football Means More”.

“Football Means More” is a comprehensive blue print of the LMC outlining strategies for legislation, investment, infrastructure, promotion, protection and general support required to jumpstart and situate domestic football as a key contributor to the Gross Domestic Product (GDP) of the Nigerian Economy as obtained in other jurisdictions, articulating the roles of various stakeholders in the process and identifying the potentials and outcomes for partners and investors.

…. to be continued

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