Gallop needs a new game plan in financial meltdown
Roar Pro
By Gabriel Knowles, 6 Mar 2009 Gabriel Knowles is a Roar Pro
- Tagged:
- Benji Marshall, Cronulla, Cronulla Sharks, David Gallop, NRL, Rugby League, salary cap
As the global financial crisis swings full steam ahead into Australia just in time for the NRL season, there are conflicting messages coming from its administrators.
Cronulla CEO Tony Zappia admits that his team are in financial trouble. He’s even gone so far as to say it’s “make or break” year for the Sharks.
If a CEO freely admits their organisation is in bad shape, then you know something is seriously wrong. And he reckons Cronulla aren’t the only ones.
David Gallop, on the other hand, seems a little non-plussed by the outcome that the GFC might have on the game he runs. Gallop seems to constantly have his head in the goal kickers bucket of sand.
Unfortunately, even the bucket of sand has long been replaced with a kicking tee.
His assertion that a financial crisis is nothing new for rugby league because the NSW clubs have been dealing with the loss of poker-machine revenue for a few years is naïve at best.
Perhaps clubs did set themselves up to deal with the poker-machine tax the NSW government introduced, but just how many of them can claim to have had that and a global financial meltdown covered?
You can be sure that many of the clubs will have lost significant sponsorship income over the off-season.
The NRL’s other standard answer to how they’ll combat the financial strain is to sing the praises of the salary cap.
“That’s why we have a salary-cap system, to distribute the playing talent and make sure all our clubs are competitive and that gives them the best chance of going forward financially,” was the well-versed line from Gallop at the season launch.
To be fair, it will get the NRL through a time when sporting bodies around the world will all be feeling the pinch. The problem is, what cost it takes on the game.
We already know that the NRL are in no mood to share their stars. The Benji Marshall saga proved that.
Apart from club loyalty, the incentive for the stars of the NRL to stay put are paling in comparison to the revenue rich league and union clubs of the northern hemisphere.
This is where Gallop needs to stand up and be counted. He talked the talk when he put the brakes on Benji Marshall setting a precedent by spending his off-season playing for a cashed up Japanese club.
While you have to admire his pugnacity in the face of a challenge, it’s time for tangible answers.
Gallop needs a new game plan, otherwise the game needs a leader who has one.
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Col the Bear said | March 6th 2009 @ 6:16am | Report comment
Gosford mentioned as one of the possible areas for expansion by JON today..personally can’t see it happening. but nice to know the RU are looking at it for it’s potential.(The NRL better hurry, bring on the CCBears).Melbourne looks likely Aust franchise..but why not bring in Argentina or Chile or Japan first.. good to see North sydney Stalwart Paul (Conno) Conlon get promoted to judge of the NRL judiciary..
Bryan Ferrie said | March 6th 2009 @ 6:43am | Report comment
Nice try Gabriel but no substance here.
No solutions from yourself proposed here? What do you propose the NRL do? Lock players up?
All sporting clubs and codes will be affected by the economic downtown. I look forward to reading your assessments on all the other codes in the coming weeks.
The man said | March 6th 2009 @ 12:45pm | Report comment
The NRL cannot be the only one struggling with the GFC (the NBL comes to mind), but interesting however the amount of interest paid in the media about the state of the games finances in comparison to the other codes. I know talk of club crisis sells papers but surely taking the microscope to other codes and in other countries would uncover the same thing.
How are the numbers now looking on the AFL’s proposed “frnachises” in Gold Coast and Western Sydney looking?? Or why is the bucket loads of cash coming from France and Japan drying up??
The world has changed.
Perhaps like any other business the NRL in the face of falling revenue (including potentially on reneogiation of TV rights) should actually be looking at reducing headcount and further tightening the salary cap to help the clubs survive – heaven forbid!
Good on Gallop for standing up to the attack and defending with a straight bat.
westy said | March 6th 2009 @ 5:46pm | Report comment
I look for substance and find none. That all codes will be affected by the global recession is so obvious I am lost for a response. The same problem pesists for the NRL as always to many teams on the south side of Sydney.
I think Benji will be resigning for $1.2 million with the Tigers over 2 years. QLD Cowboys have signed 4 new Sponsors all local They now have 8..QLD is the NRL’s strength.
The NRL increased its salary cap this year by $100000. The Guinness Cup premiership reduced their clubs salary cap by 200000 poundsand some are operating 700000 to 1.2 million pounds below. They are also losing players to Europe. Does this mean rugby is losing no just that the belt tightening is across the board . I am sure the Crusaders enjoyed their first bus trip to and from Canberra.
Crosscoder said | March 14th 2009 @ 7:42am | Report comment
For too long rl clubs have relied on handouts from their Leagues’ club (basically poker machine money).The new tax increases,coupled with the GFC have impacted heavily on this.
That being said Gallop did say many of the clubs,experiencing the taxes for a few years are now adopting new strategies.
tigers and sharks with new commercial developments down the line,with interest rates low and a slack in the building industry .Clubs are also pushing the memberships ,which they should have done decades ago.
The NRL(head body) have retained all their major sponsors,the Tv contract locked in till end 2012.Clubs such as Cronulla have retained all their major ones,and have looked at Adelaide for one game as addtional sources of revenue.
The under 20 comp which was a cost impost on the NRL ,has been relieved and is now self funded by the new Fox Tv contract(due to its ratings success).
Worst case scenario IMO,is relocation of teams to Perth and Adelaide a second Brisbane side and the CC Bears.At least the rugby league has that “safety” net.Merging is really the end of the line.
From an outsiders point of view the GFC has and is affecting all codes.I look at some of the ordinary s14 crowds in NZ(the national sport),asking myself is it the GFC or are people turned off.Ditto the recnt 19,000 that turned up for the Tahs(unbeatebn) at the SFS.The game is not on FTA in Oz.John o’Neill seems to think so BTW.
The AFL’s current contract,which some within that medium considered overpriced ,considering the poor TV ratings in Qld and NSW needs also to be considered.The AFL is expecting $200m PA with their next contract.How can they justify that ,even allowing for 2 extra teams,but taking into account the ordinary Tv raings in the nthn states, is beyond me.
When you hear the likes of Warren Buffett who knows a little about commerce,he is predicting 5 years before the USA gets back to even keel.The US sneezes,we catch a cold.