Changes in Distribution of La Liga TV Money Hurt Real Madrid and Barcelona

The new legislation that is expected to pass in the Spanish parliament and come into effect in 2016 brings an end to the broadcasting rights monopoly held in the La Liga by Real Madrid and Barcelona.

For some time Real Madrid and Barcelona had the freedom to make their own broadcasting arrangements and negotiate contracts with TV networks separate from the rest of La Liga. This created an imbalance as Real and Barca were making a lot more from TV rights compared to other teams in the league and as a result were able to financially dominate in the transfer market.

The new law promises to balance things out and spread the TV money more proportionately. From 2016 onwards 50% of the broadcasting revenues will be distributed evenly among the teams, while the distribution of the other 50% will depend on the league performance in the past five years and social relevance of each team.

At the end of the day Real Madrid and Barcelona FC, as the two by far most popular and best performing clubs in Spain, will still take the largest share of the profits, but the new arrangement will be more fair for other clubs.

The new La Liga revenue distribution model is in line with how the English Premier League (EPL) and the Italian Serie A operate.