The structural transformation of the English football pyramid

The 2024/25 football season represented the most significant restructuring of broadcast rights and financial distribution mechanisms in the modern era. 

For decades, the economic narrative of the English game has been defined by the colossal gravitational pull of the Premier League, whose global broadcast revenues have dwarfed those of the lower tiers.

 However, the five-year cycle beginning in 2024 signifies a strategic pivot for the English Football League (EFL) and the National League, driven by a recognition that football content beyond the Premier League holds untapped commercial value in an increasingly fragmented media landscape.

This report provides an examination of the broadcast deals and financial distribution models that now underpin the English football pyramid.

 It analyses the record-breaking £935 million domestic agreement between the EFL and Sky Sports, the international rights strategy involving Pitch International and Relevent Sports, and the pioneering direct-to-consumer (DTC) partnership between the National League and DAZN. 

Furthermore, it dissects the controversial mechanisms of wealth redistribution, specifically Solidarity and Parachute Payments, flowing from the Premier League to the lower divisions, which continue to serve as both a lifeline for sustainability and a catalyst for competitive distortion.

The analysis draws upon a wide array of financial data, regulatory documents, and commercial agreements to construct a detailed picture of the revenue streams available to clubs across the Championship, League One, League Two, and the National League system. 

By examining the granular details of basic awards, facility fees, and merit payments, this report throws light on the complex financial ecosystem that dictates the solvency and ambition of over 100 professional and semi-professional clubs.

The context of the 2024 reset

The genesis of the current financial landscape lies in the EFL’s strategic review conducted prior to the 2024 tender process. 

Historically, the EFL’s domestic rights were undervalued relative to the volume of content produced, with the previous cycle generating approximately £119 million annually for the distribution to 72 clubs.

This figure was increasingly insufficient to cover the inflationary costs of operating professional football clubs, particularly in the Championship where wage-to-turnover ratios frequently exceeded 100% as clubs gambled on promotion to the Premier League.

The 2024 renewal process was driven by two imperatives: firstly, to secure a substantial uplift in guaranteed revenue to stabilise club finances; and secondly, to modernise the consumption model for a digital-native audience without cannibalising matchday revenue stream that remains the lifeblood of lower-league football. 

The resulting agreement with Sky Sports, valued at £935 million over five years, represents a 50% increase in value. However, this uplift came at the cost of exclusivity; the EFL essentially traded volume for value, agreeing to broadcast over 1,000 matches per season, a fourfold increase on the previous deal.

Simultaneously, the National League found itself at a crossroads. Following the expiry of its deal with TNT Sports (formerly BT Sport), the fifth tier opted for a radical departure from traditional linear broadcasting, embracing a global streaming partnership with DAZN. 

This move reflects a broader trend in sports media where niche or lower-tier properties are moving behind digital paywalls to access global audiences directly, bypassing the scheduling constraints of linear television.

The cliff edge and the Independent Regulator

Running parallel to these commercial developments is the intensifying debate regarding the financial gulf between the Premier League and the rest of the pyramid. The cliff edge between finishing 20th in the Premier League and competing in the Championship has widened to over £100 million in guaranteed revenue. While the new EFL deal narrows this gap marginally in percentage terms, the absolute disparity remains vast. The continued existence of Parachute Payments which allocate hundreds of millions to a small cadre of relegated clubs remains the primary point of contention in discussions regarding the Independent Football Regulator (IFR). The EFL’s acceptance of the Sky deal was predicated on the assumption that it would eventually be supplemented by a more equitable distribution of Premier League wealth, a negotiation that remains ongoing and fraught with political complexity.

The EFL domestic broadcast rights agreement (2024-2029)

The cornerstone of the EFL’s financial stability for the next half-decade is the domestic rights agreement with Sky Sports. This deal is not merely a renewal but a restructuring of the broadcast product, shifting from a model of scarcity (showing a few “big games”) to a model of ubiquity (showing almost everything).

Valuation and commercial structure

The headline valuation of the deal is £935 million over the five-year term, running from the 2024/25 season through to the end of 2028/29. This figure is composed of two distinct elements:

1. Guaranteed Rights Fees: £895 million.
2. Marketing and Commercial Investment: £40 million.

This structure equates to an average annual value of approximately £187 million, composed of £179 million in rights fees and £8 million in marketing support. This represents a significant uplift from the previous cycle’s annual value of circa £119 million. The inclusion of a specific marketing budget is a strategic acknowledgement that with 1,059 matches to broadcast, significant investment is required to drive viewership for lower-profile fixtures in League One and League Two that previously would not have been televised.

The agreement was ratified unanimously by all 72 member clubs in May 2023, signaling a rare consensus across the divisions that the offer from Sky Sports represented the best possible balance of revenue and exposure available in the market. It is important to note that this deal effectively bundles all domestic audio-visual rights, extinguishing the ability of clubs to sell domestic streaming passes via iFollow, a critical shift discussed later.

Inventory volume and Sky Sports+

The most transformative aspect of the agreement is the sheer volume of content. Under the previous deal, Sky Sports broadcast fewer than 250 matches per season. The new agreement mandated the live broadcast of 1,059 matches per season, comprising nearly 60% of all fixtures played under the EFL’s jurisdiction.

Domestic broadcast inventory breakdown (2024-2029)

To accommodate this volume without launching dozens of new linear channels, Sky introduced Sky Sports+, a hybrid linear and digital platform integrated into Sky Q, Sky Glass, Sky Stream, and NOW. 

This technology allows for up to 100 concurrent live streams, enabling the broadcaster to show every single match of the Carabao Cup and all midweek league fixtures simultaneously.

This volume strategy serves a dual purpose. For the EFL, it maximises the rights fee by offering Sky a churn-reduction tool; subscribers are less likely to cancel if every game of their specific team is available (outside blocked hours). For Sky, it creates a comprehensive content library that competes directly with pirate streams, which had increasingly plagued the 3:00 PM blackout window.

The protection of matchday revenue: Article 48

A critical component of the negotiation was the retention of the blocked hours protection under Article 48 of the UEFA Statutes, which prohibits the live broadcast of football matches in the UK between 2:45 PM and 5:15 PM on Saturdays. The EFL conducted extensive modeling during the tender process and estimated that removing the blackout would result in a net loss of £37 million in matchday attendance revenue.

The logic posits that lower-league clubs rely heavily on walk-up crowds and season ticket holders who might choose to stay home if the match were televised. Consequently, the 1,059 broadcast matches are scheduled exclusively outside this window. The “main” slot for EFL coverage has shifted to:

• Friday Evenings (Championship focus)
• Saturday Lunchtime (12:30 PM) (All divisions)
• Sunday Afternoons
• Midweek Evenings (Tuesday/Wednesday) – All midweek league matches are broadcast.
• Bank Holidays & Opening/Closing Weekends – All matches broadcast.

This scheduling necessitates a significant disruption to traditional habits, with clubs and fans receiving longer notice periods (up to 6 months) for television selections to mitigate the inconvenience of moved fixtures.

The abolition of domestic iFollow

One of the most controversial elements of the deal for clubs with large, geographically dispersed fanbases is the termination of domestic streaming services. Previously, clubs utilised the iFollow platform (or proprietary equivalents like CharltonTV or Argyle TV) to sell £10 match passes for non-televised midweek games directly to UK fans. Clubs retained the vast majority of this revenue, creating a direct link between the size of their digital fanbase and their income.

Under the 2024 agreement, domestic video streaming is exclusively the domain of Sky Sports.

• Impact on Revenue: Clubs no longer receive direct transactional revenue from domestic video passes. Instead, this value is theoretically captured in the increased “Basic Award” from the central pot.
• Winners and Losers: Smaller clubs with fewer digital subscribers likely benefit from the guaranteed uplift of the central deal. Larger clubs (e.g., Leeds United, Sheffield United) that could sell tens of thousands of streaming passes may find the centralisation of this revenue stream less advantageous compared to a direct model, although the overall magnitude of the Sky deal attempts to offset this.
• Audio Rights: Crucially, clubs have retained audio commentary rights. They can still sell audio-only subscriptions domestically, preserving a smaller, but high-margin, revenue stream.

Financial distribution: The EFL waterfall model

The primary mechanism for funneling the broadcast revenue to the clubs is the basic award, a guaranteed central distribution paid to every member club. The EFL operates a weighted distribution model, acknowledging that the Championship drives the majority of the broadcast value, while League One and League Two require subsidies to maintain the integrity of the pyramid.

The 2024/25 distribution formula

The new deal’s revenue uplift has been applied differentially across the divisions. The distribution formula agreed upon by the clubs results in the following uplifts compared to the previous cycle:

• Championship: ~46% increase in guaranteed broadcast income.
• League One & League Two: ~25% increase in guaranteed broadcast income.

This differential aims to narrow the gap between the Championship and the Premier League (to assist promoted clubs) while ensuring lower-league clubs remain solvent.

Championship payments

Championship clubs are the primary beneficiaries. The Basic Award for a Championship club in the 2024/25 season is estimated to be between £4.6 million and £5.0 million. This figure represents the club’s share of the domestic rights fees, international rights revenue, and commercial sponsorships pooled by the league.

However, the basic award is only one component. Championship clubs also receive Solidarity Payments from the Premier League, which are significantly higher than those for lower divisions.

• Estimated total central distribution (Championship): £10.0m – £10.5m per club (combining EFL Basic Award + PL Solidarity).

League One payments

League One clubs see a smaller, yet vital, increase. The cliff edge between the Championship and League One is stark.

• Basic Award: Estimated at £1.0m – £1.2m per club.
• Estimated Total Central Distribution (League One): £1.8m – £2.0m per club.
  This steep drop-off explains the financial distress often faced by clubs relegated from the Championship, as their central revenue drops by approximately 80% overnight.

League Two payments

League Two clubs operate on the tightest margins.

• Basic Award: Estimated at £0.8m – £1.0m per club.
• Estimated Total Central Distribution (League Two): £1.2m – £1.4m per club.
  For many League Two clubs, this central distribution covers a significant portion (often 30-50%) of their total playing budget, making the 25% uplift crucial for survival against inflationary pressures.

Performance and variable elements

Beyond the fixed Basic Award, the distribution model includes variable elements designed to reward on-pitch success and compensate for the operational costs of hosting televised matches.

Facility fees (TV appearance money)

Under previous deals, Facility Fees were substantial payments (often £100,000+ per game for home sides) paid when a match was selected for broadcast. This system incentivised clubs to be on TV but created disparity, as popular clubs (e.g., Leeds, Sunderland) appeared far more often than smaller ones.

With the new volume of 1,059 games, the facility fee model has been recalibrated.

• Volume dilution: The unit cost per match must mathematically decrease given the fixed pot size and the 4x increase in inventory.
• Equalisation: To prevent the top clubs from monopolising this revenue, the new deal mandates a more equitable spread of TV selections.

• Championship: Each club is guaranteed to be live approx. 23-24 times per season.
• League One/Two: Each club is guaranteed to be live approx. 20 times per season.
• Implication: This structure effectively converts what was once a highly variable bonus into a more predictable, quasi-fixed revenue stream. The variance in facility fee income between the most and least popular clubs in a division will be significantly compressed compared to previous eras.

Merit payments

Merit payments function as prize money based on the final league table position.

• Mechanism: The pot is distributed on a sliding scale, with the champions receiving the maximum and the bottom club receiving the minimum.
• Championship Value: The difference between finishing positions can represent approx. £50k-£75k per place, meaning the difference between 1st and 24th can be over £1.5m in merit payments alone.
• Lower Leagues: The increments are smaller, but for a League Two club, the difference between a mid-table finish and the play-offs can fund a key player’s wages for a season.

International

While domestic rights provide the baseline, the 2024-2028 cycle sees the EFL aggressively targeting international growth, particularly in the Americas. Recognising the disparity in market maturity, the EFL split its international rights into two distinct packages for the first time.

The Split Strategy: Pitch vs. Relevent

The EFL secured a record £147.7 million in international rights revenue over four years (approx. £37 million per season), a significant increase driven by global interest.

1. Rest of World (Europe, MENA, Asia): Rights were awarded to Pitch International.

• Inventory: Pitch distributes a curated package: 155 exclusive Championship matches, 38 League One/Two matches, all Play-Offs, all Carabao Cup matches, and 3 Trophy matches.
• Logic: In traditional markets, demand is concentrated on the top tier (Championship) and cup competitions involving Premier League giants. A select package maximises value without flooding the market with low-demand inventory.

1. The Americas (USA, Canada, Latin America): Rights were awarded to Relevent Sports.

• Inventory: Relevent distributes ALL EFL matches across all competitions.
• Logic: This is a direct response to the Wrexham Effect. The surge in interest in lower-league English football in the US, driven by the docuseries Welcome to Wrexham, demonstrated that there is a viable audience for League One and League Two content in North America. By offering the entire inventory, the EFL empowers US broadcasters (CBS Sports) to serve these niche but passionate fan bases comprehensively.

International streaming retention

Crucially, while domestic streaming was abolished, the EFL retained the international streaming option for clubs.

• Mechanism: Clubs can still sell “iFollow” (or equivalent) subscriptions to fans outside the UK unless a match is selected for exclusive international broadcast in that specific territory.
• Dark Market Revenue: In dark markets (territories where no broadcast deal exists) or for matches not selected by Pitch/Relevent, clubs keep the streaming revenue.
• Strategic Importance: This allows clubs with large expat or international fanbases to generate uncapped revenue. For a club like Wrexham or Birmingham City (with US ownership), this is a multi-million pound revenue stream that sits outside the central distribution, directly incentivising global brand building.

Inter-League wealth redistribution: Premier League solidarity and parachute payments

The financial sustainability of the EFL is inextricably linked to the Premier League through a system of wealth redistribution. These payments are designed to trickle wealth down the pyramid, but their implementation creates significant competitive imbalances.

Solidarity payments (non-parachute clubs)

Solidarity payments are paid to EFL clubs that are not in receipt of parachute payments. They are funded by the Premier League’s broadcast revenue and are intended to bridge the gap between the divisions. The value of these payments is calculated as a percentage of a Year 3 Parachute Payment (approx. £17.8m in 2024/25).

Premier League solidarity payments breakdown (2024/25)

Analysis: The disparity in solidarity payments reinforces the hierarchy. A Championship club receives 6.7x the solidarity of a League One club. Combined with the drop in Basic Award (approx. £4.6m to £1.0m), a relegated Championship club faces a total central revenue contraction of roughly £8 million (from ~£10m to ~£1.8m) in a single season. This structural reality forces clubs to insert aggressive relegation wage-drop clauses in player contracts to avoid administration.

Parachute payments: the market distortion

Parachute Payments are the most contentious element of English football finance. Paid to relegated Premier League clubs, they are designed to cover contract liabilities (high wages) that cannot be immediately shed upon relegation. They are calculated as a percentage of the Premier League equal share (approx. £88-90m).

Premier League parachute payment schedule (2024/25)

The “Yo-Yo” effect:

The competitive distortion is immense. In the 2024/25 season, a club with a Year 1 Parachute Payment receives £48.9 million from the Premier League alone. Conversely, a rival Championship club receiving Solidarity payments gets £5.38 million. This gives the relegated club a £43.5 million head start before a ball is kicked or a ticket is sold.

Research cited in parliamentary hearings suggests that clubs with parachute payments are ten times more likely to be promoted back to the Premier League than those without. This has created a closed shop at the top of the Championship, often referred to as a “Yo-Yo” zone, where clubs like Norwich City, Watford, and Burnley historically cycle between divisions, subsidised by the Premier League.

For the 2024/25 season, the Premier League has committed over £633 million to parachute payments, nearly double the amount provided in solidarity to the entire rest of the pyramid (£350m).

The National League ecosystem: streaming and solidarity

Below the EFL lies the National League, which functions as a hybrid professional/semi-professional division. The 2024/25 season introduces a revolutionary broadcast model for this tier.

The DAZN partnership: A revenue-share experiment

Abandoning the traditional rights fee model with TNT Sports, the National League signed a seven-year deal with DAZN covering 2024-2031. This deal is global, offering over 600 matches to over 200 territories.

The Commercial Mechanism:

Unlike the EFL’s guaranteed millions, the National League deal relies on a revenue-sharing model driven by subscriptions.

• Revenue Split:

• 60% of net subscription revenue is allocated to the specific club the subscriber supports.
• 15% is retained by the League for administrative/production costs.
• 25% is pooled and distributed among the 72 member clubs (weighted 70% to the National League, 15% each to North/South divisions).

• Implications: This model effectively gamifies broadcast revenue. A club with a large fanbase (e.g., Southend United, York City, or historically Wrexham/Notts County) can generate significant direct income by driving fans to subscribe to DAZN. Conversely, smaller clubs with few subscribers will see minimal benefit beyond the small pooled pot.
• Guaranteed Payment: While specific figures fluctuate, estimates for the central pooled payment (the 25% pot) suggest a figure in the region of £100,000 – £125,000 per club for National League sides. This is a fraction of the League Two Basic Award (£800k+), emphasising the massive financial leap required for promotion to the EFL.

Premier League support for the National League

Recognising the National League’s role in the ecosystem, the Premier League provides targeted financial support.

• Solidarity Funding: For the 2024/25 season, the Premier League provides £4.8 million in solidarity payments to the National League, alongside £1 million for the National League Trust to fund community projects.
• National League Cup: A new initiative for 2024/25 sees 16 National League clubs competing against Premier League U21 teams. The competition is fully funded by the Premier League with a £1 million prize fund. Clubs earn appearance fees (e.g., £20,000+ for group stage participation) and keep 100% of gate receipts, providing a vital new revenue stream for the participating clubs.

Parachute payments in the National League

Clubs relegated from the EFL to the National League receive parachute payments funded by the EFL (not the PL) to prevent immediate insolvency.

• Year 1: 100% of the League Two Basic Award (~£472,000).
• Year 2: 50% of the League Two Basic Award (~£236,000).
  This creates a soft landing but also gives relegated EFL clubs a significant budget advantage over organic National League sides (who receive ~£58k in central distribution + DAZN share).

Future outlook

The 2024-2029 cycle defined a new economic reality for English football. 

The EFL has successfully leveraged the volume of its content to secure a record domestic deal with Sky Sports, stabilising the finances of its member clubs with a 46% revenue uplift in the Championship. 

The introduction of Sky Sports+ and the partnership with DAZN in the National League signify the definitive end of the linear-only era, pushing the pyramid toward a digital-first future where availability is total, and every match is a monetisable event.

However, the structural fault lines remain dangerously active. The cliff edge between the Premier League and the Championship has not been resolved; if anything, the absolute monetary gap has widened. Parachute payments continue to distort the competitive integrity of the Championship, creating a division of haves (the relegated PL elite) and have-nots (the rest).

The disparity in Solidarity payments further entrenches the hierarchy between the Championship and League One. While the National League’s DAZN deal offers high upside for bigger clubs, it risks leaving smaller community clubs behind if subscription targets are not met.

As the industry awaits the  intervention of an Independent Football Regulator, the 2024/25 season served as a live experiment: can the English football pyramid sustain itself through increased broadcast volume and international expansion, or will the gravitational pull of the Premier League’s wealth continue to fracture the competitive balance of the game? 

The broadcast deals detailed in this report provide the capital to keep the lights on, but the systemic inequalities of their distribution ensure that the struggle for sustainability is far from over.