OTT sports broadcaster DAZN has acquired the rights for all Serie A matches in Italy–seven exclusive and three co-exclusive per game week, taking Sky Italia’s place as the primary broadcaster of the league for three seasons from 2021 to 2024. DAZN has built up a subscriber base of over 1.5m since its 2018 launch in Italy, supported by a secondary package of the 2018-2021 Serie A rights worth €193m per season, while pay TV provider Sky Italia has been paying €780m. DAZN will now pay a significant increase of €840 million per season, but the bid comes with support from Telecom Italia (TIM) and will see DAZN carried by TIM with some content provided exclusively for its subscribers. 

The financial details of the agreement have not been disclosed but, according to reports, TIM could pay DAZN up to €340m per season. It is likely that the overall value of domestic Serie A rights will decline slightly, with only three co-exclusive games remaining at tender and the total currently €133m shy of the last cycle’s value, but the league may increase its intake with additional payments based on DAZN’s performance.

Most of DAZN’s income will be from subscription revenue, and after acquiring such a significant property DAZN will want to raise its price in a way that reflects the quality of its portfolio but avoids significant churn. For subscription revenue to offset the yearly €500m DAZN will pay for Serie A rights (after TIM’s estimated financial contributions), the current €10 monthly price point would mean DAZN needs to reach 5.3m subscribers before the deal becomes profitable, while raising the price to €20 per month would bring this figure down to around 2.7m subscribers. Reaching these levels over the course of one rights cycle will be a difficult task for DAZN: Previous Serie A rights holders Mediaset had a peak of 2m subscribers to its pay TV service while Sky Italia ended 2020 with 5.2m total pay TV subscribers. DAZN will hope to cover most of the costs through subscriptions, but developing its advertising revenue streams and introducing one-off transactions based around Serie A matches could allow the OTT sports broadcaster to capture revenue from a wider consumer base and reduce the pressure to reach these subscriber targets.