Premiere loses Bundesliga rights

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German pay TV group Premiere was desperately searching for a future strategy after it lost the rights to show live German soccer matches from next season.

Premiere had bet everything on showing live matches from Germany's top-flight Bundesliga but suffered a major setback on Wednesday after the German Football League (DFL) decided this week not to award it the rights to continue showing matches from 2006.

"Premiere now has an increased room for financial maneuver to further develop its choice of programs in all areas," Premiere announced on Wednesday after the decision.

But the channel headed by Austrian Georg Kofler has no other genuine programming other than the Bundesliga.

Even Kofler admitted there was "no plan B," although the group was quick to point out that it retained rights to show matches from the 2006 World Cup finals that take place in Germany and the Champions League, Europe's top club competition, from 2006 until 2009.

But Helmut Thoma, the former head of the RTL media group, said Premiere faced a struggle.

Premiere bet the farm on retaining the rights -- and lost it all

"The prospects of Premiere have always gone hand-in-hand with the rights to soccer," he told AFP. "It is going to be very hard to survive without soccer."

Premiere only launched on the Frankfurt stock market this year and its shares plunged more than 40 percent on Wednesday in the wake of the decision.

Cable gets rights over Premiere in surprise move

In a surprise decision, the DFL decided that live soccer in Germany, one of Europe's top leagues, will be shown by Arena, a consortium of two small cable TV operators that is in talks with the far bigger Kabel Deutschland.

Public broadcasters ARD, ZDF and DSF will show highlights.

Most German householders are connected to cable TV, which effectively means that soccer on television will become more widely accessible in Germany.

Premiere, once part of the giant Kirch media empire, built its success on soccer, modeling itself on France's Canal Plus and the Rupert Murdoch-owned Sky in Britain.

Under the current system, nearly 3.4 million people pay Premiere a minimum 20 euros ($23.7) a month for the right to see Bundesliga domestic matches and Champions League games that the other channels are not allowed to broadcast.

An estimated 10 percent of subscribers may dump Premiere

Fewer Premiere packages will be sold in the coming years, say analysts
Having lost the right to show live matches, many analysts are speculating that viewers will desert the channel. Some put the figure at around one third, while Kofler believes it will be more like 10 percent.

Premiere had in fact made the most lucrative offer to the DFL in a bid to retain its rights -- around 300 million euros a season, according to reports.

But it made the crucial error of attempting to insist that the "Sportschau" show, shown on state channel ARD early on a Saturday evening and the essential round-up for all football fans, be moved to a late night slot to give more time between the live games and the highlights.

Some observers believe that Premiere was punished for its negotiating stance.

"It was a bad negotiating technique," said Hypovereinsbank analyst Peter-Thilo Hasler.