NRL TV Rights..............Rupert to run?

[FFC Mariner]

http://www.brisbanetimes.com.au/business/its-on-tv-rights-to-sports-in-chaos-as-news-signals-an-nrl-offload-20091007-gn56.html

(This is from Roy Masters so his league blinkers are on)



It's on: TV rights to sports in chaos as News signals an NRL offload
ROY MASTERS
October 7, 2009

THE first shots have been fired in what will become a bitter battle for the TV rights to the National Rugby League and the Australian Football League, with Channel Seven revealing it intends to challenge Nine for the nation's most valuable sporting property: State of Origin matches.

The rumbling in the media-football landscape grew louder yesterday after News Ltd gave the strongest indication yet it would walk away from rugby league and rescind its NRL half-ownership.

The Daily Telegraph said the former prime minister John Howard had been approached to head an independent commission to govern league, a sure sign the media giant is looking for a quick exit from a game it has controlled for more than 10 years.

A bidding war for league TV rights will send shockwaves through the sporting landscape and will especially worry the AFL, whose grand final was outrated by league's decider, even though league earns $50 million a year less in rights fees.

Rugby league will face a short-term funding gap and the Seven chief executive, David Leckie, anticipates the code will seek new revenue by unbundling its TV rights and offering four separate packages: Origin, Test matches, NRL regular-season matches and the finals series.

''We're very keen to submit a bid for State of Origin and Test matches,'' Mr Leckie said. ''We think rugby league should split its properties into three, or four, with even the finals going to a separate network.''

The chief executive of the NRL, David Gallop, has confirmed he would split the properties if it maximised revenue for a code that has had to fight for its share of the TV-rights pie with one arm tied behind its back because News Ltd owns half the competition as well as holding a 50 per cent share in its major TV broadcaster, Fox Sports.

The AFL's TV deal runs out at the end of the 2011 season and the NRL's runs out the following year, although negotiations could be brought forward.

''Obviously we would need to ensure the sum of all properties sold is greater than the total we would get from, say, Nine and Fox Sports who currently share our properties,'' Mr Gallop said.

Mr Leckie and Mr Gallop would win by seizing revenue from rivals - Seven taking advertising from Nine and the NRL undermining the AFL's push into western Sydney and the Gold Coast.

The AFL is demanding $1 billion over five years from its next broadcasting contract, using it to finance its expansion to rugby league territory.

Mr Leckie said Seven's programming of Origin and Test matches would have minimal impact on its weekend coverage of AFL games. But the AFL's expectation that it will receive $200 million a year for its planned nine games a week from 2012 will be challenged if Seven pays a premium for Origin and Test matches. Nor can the AFL, which has no representative games of any credibility, unbundle its properties, except to sell finals.

Channel Ten, Seven's free-to-air partner in the AFL rights, has indicated interest in buying NRL regular-season matches.

If the AFL's free-to-air TV partnership breaks up, Foxtel, which buys four AFL games a week from Seven-Ten, would presumably increase its programming.

All major sports are required to submit their wish list on the Federal Government's anti-siphoning legislation next week. With pay TV's pot of gold increasing at a time that free-to-air networks are using profit to pay off debt, the big codes want the rules relaxed.

''We want the list abandoned but if it is retained, we want guarantees the free-to-air channels can't hoard games by showing them on their digital channels,'' Mr Gallop said.

The potential recasting of TV rights could involve cricket. It, too, has distinct properties for unbundling: Tests, one-dayers and Twenty20 matches.

''I think cricket should also split their games,'' Mr Leckie said.

However, at least two senior network executives have found the influence of Kerry Packer still dominates Cricket Australia.

Rival networks seeking to meet the chairman and board of Cricket Australia have not had their calls returned or requests for appointments answered.

They argue that cricket is in serious trouble, devoid of personalities and is in need of a makeover, yet is still ruled by the ghost of Packer

 

[dibo]

Wishful thinking FFC - they're simply moving towards the AFL Commission's model (which is similar to the HAL model now in operation). It's not their death knell, and with multichannelling they're probably in pretty good shape to have a competitive battle for the rights, just like us and the AFL.

They had record ratings this year and the article notes that the NRL grand final outrated the AFL's (harder to fake than crowd figures) in spite of crisis after crisis after crisis, so I don't think they're in any trouble.

 

[FFC Mariner]

More interested in News Ltd cutting and running 8 years early (20 year deal from 1997).

 

[MrCelery]

More interested in News Ltd cutting and running 8 years early (20 year deal from 1997).

Care factor - zero

 

[dibo]

[quote author=SMH]Little room to move for TV's football coverage

ELIZABETH KNIGHT
October 9, 2009

The move by Rupert Murdoch's News Corporation to cut several aspects of its relationship with rugby league has been described by one insider as a cupboard-cleaning exercise that will involve getting rid of the company's 50 per cent of the NRL and its ownership of this year's premier team, Melbourne Storm, and its majority ownership of the Brisbane Broncos.

News Corp's part ownership of the NRL is a legacy of the truce made between it and Kerry Packer after the monumental Super League battle waged 10 years ago that threatened to split the code.

Murdoch apparently now feels there is nothing to be gained by continuing to own any part of the NRL, the structure of which is messy and riddled with conflicts.

The idea is to appoint a group of businessmen as commissioners (a board) to oversee the operations of the new NRL. A similar view was apparently arrived at by a group of club bosses who for several months have been hatching plans to clean up the corporate structure.

The NRL is owned half by News and half by the Australian Rugby League. The revenue it receives primarily from selling multimedia rights and then from gate takings goes to the various clubs.

Part of the News Corp exit deal will be retention of its rights of first and last refusal over the all-important television broadcasts, which Murdoch clearly feels are strategically important.

The value of News Corp's 50 per cent of the NRL is negligible and is unlikely to be sold. Rather, News would withdraw. It was suggested that the $8 million in revenue the NRL ownership earns for News is pumped back into the teams it owns - the Storm and Brisbane Broncos.

It is also understood that News has no desire to sell either its 50 per cent of Fox Sports or its 25 per cent of Foxtel.

Meanwhile, there is the battle between the NRL and the AFL over which should receive higher bids for the television rights to the games.

The AFL contract is worth about $780 million over five years and the NRL about $600 million.

Thanks to recent ratings popularity the NRL is suggesting it should not play second fiddle to the AFL. Clearly the AFL, which is now looking to renegotiate the multimedia rights for $1 billion, disagrees.

It is now a race to see who can tap the networks first. While the NRL rights come up for negotiation next year and is thus the first cab off the rank, there are suggestions the AFL will bring its negotiations forward.

There is a definite first mover advantage to these negotiations as the kitty available to all the networks is limited.

The late Kerry Packer's famous swansong deal was to launch a huge bid for the AFL and wrest the coverage from Seven.

Seven is now upsetting the status quo by suggesting it wants a piece of the ARL pie.

Yesterday the Herald reported that rugby league would face a short-term funding gap and that the chief executive of the Seven Network, David Leckie, expected the code would seek new revenue by unbundling its TV rights and offering four separate packages - Origin, Test matches, NRL regular-season matches and the finals series.

''We're very keen to submit a bid for State of Origin and Test matches,'' Leckie said. ''We think rugby league should split its properties into three, or four, with even the finals going to a separate network.''

Perhaps Leckie's is the only one of the three commercial networks in the enviable position of having its programming executives in charge of its kitty.

Seven's private equity partner KKR is no doubt looking over its shoulders assessing whether entering a bidding war for any part of the disaggregated football package would attract a return from advertising dollars.

At Ten the management will be closely watched by its banking syndicate, which would be asking many questions about any big-ticket program acquisitions. At Nine the position is even more dire.

Having said that, these big-ticket sporting events are the highlight of the television calendar and will attract premium advertising dollars.

There will be a push to outlay an increased amount for pay television and digital and mobile phone rights. But if either the NRL or the ARL disregards the fact that the bidders are financially strapped, they are likely to be disappointed[/quote]

 

[midfielder]

Many people  underestimated the real worth of RL . in the right hands it could get a media deal others could only dream of.

To explain the population of regional NSW & QLD is almost a million more than the combined population of SA / WA / NT / & TASSIE . Further I have read a number of times the number of NSW & QLD folk in NT mean it could be a RL territory .. however lets no argue as its only small anyway.

But RL is very popular in PNG , most in NZ have a NRL team, and the NRL is quite popular in Fiji. If you add the combined population of PNG / NZ / Island Nations its about 11.5 million people of which 6.25 million live in PNG 4.2 in NZ & 800K in Fiji

If RL take the game to Perth where they have a track record and friend in Perth Glory who are only happy to share ground and common costs then a Perth team again given the number of NSW & QLDers there again could rate plus the great Ch 9 marketing of the Storm (read the Richard Hindes bit in the smh very funny but true in that the CH 9 media by being so Sydney Bias in the GF and lead up to the GF they actually had Melbourne cheering for the storm)

The arguement is people in regional NSW & QLD watch RL... whereas the current method of allocating the way these people watch TV is via a the capital cities approach meaning it gives a false impression of the rating between AFL & NRL ( who cares I hear you ask). Football should as NSW & QLD regional also have a huge football TV audience which is not counted either...

So lets see .

State Pop..Regional NSW & QLD
QLD ..4,279,411 ...2,421,817
NSW..6,967,200.2,630,826
ACT 344, 200...344,200
VIC.5,927,600
TAS.. 498,200
SA .1,601,800
WA ...2,163,200
NT 219,900
Total.... 22,001,511.. 5,396,843

TAS 498,200
SA ..1,601,800
WA ..2,163,200
NT 219,900
Total 4, 483, 100

Meaning regional NSW & QLD has more people than TAS / SA / WA / & NT

The combined population of NSW / ACT / QLD is 11, 590, 811, and RL rating territory add PNG 6.25, plus NZ 4.2 plus 1 million over Fiji, Tonga, Soma,

In broad terms almost 23 million with only NZ & other island nations not having RL as their first spot .. but number 2 in both countries Plus notional TV audiences in the Southern states and you would assume growth This does not count the pay TV market in the UK where RL has a market when added to the 23 million above HMMMmmmm interesting indeed

Throw in the State of Origin & an annual Six nations tournament . In the right hands this could bring a pretty penny indeed.

I understand that the buying power of the good folk of PNG other island nations and NZ may not be the same as in Australia but they all buy soap and milk and Clive Palmer has offered to fund a team playing out of PNG However the buying power of England would be more than Australia .

If RL is thinking this way the next round of media deals will be very interesting . very interesting indeed

Football media deal will be huge as well...

 

[curious]

The arguement is people in regional NSW & QLD watch RL... whereas the current method of allocating the way these people watch TV is via a the capital cities approach meaning it gives a false impression of the rating between AFL & NRL ( who cares I hear you ask). Football should as NSW & QLD regional also have a huge football TV audience which is not counted either...

OzTam/RegTam FTA ratings do include regional areas in ratings.  5 city metro average + regional average = combined average.
Astra pay tv ratings (including aleague) are also 'all people' and in fact, do include regional areas also.