New Zealand the country or New Zealand the state?

 
The Crowd Roar Guru

By Emric, 19 Oct 2012 The Crowd is a Roar Guru

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    New Zealand: it’s a small but great country that punches above its weight in a lot of sports.

    At the last Olympic Games, the nation came close to beating Australia in the gold medal count and it regularly holds its own across a number of sports.

    Why is this?

    New Zealand is a small country, with a population of only 4.3 million; if it was a state of Australia it would be the fourth biggest state after NSW, Victoria and Queensland.

    It currently contributes teams to NBL, NRL and A-League competitions and has equal partnership in netball and rugby. So, except for rugby and netball, which are by far the two most popular sports in the country, New Zealand has managed to cling onto the coat tails of Australian sporting competitions.

    The reasons for this complex relationship between the two nations and why Australia would want to involve little old New Zealand in its vastly superior and better funded sporting environments are question worth exploring.

    What does Australia get from the relationship? What does New Zealand contribute? How could this sporting relationship evolve in the future?

    A Little History

    The history of Australasian sporting competitions goes back to the late 19th century when, in 1889, New Zealand first entered a team into the Australian Rules Football inter-league competition between the competing Australasian colonies.

    This association lasted until New Zealand stopped sending teams in 1908 as the Australian Rules Football in New Zealand had dived into a steep decline. It is an interesting side note that the jersey used by the New Zealand Australian Rules football (NZARF) side was black with a golden fern insignia.

    In 1908 Australia and New Zealand combined its sporting talent into a team called Australasia, which competed in the 1908 and 1912 Olympic Games. This alliance was short lived, as the team was disbanded after the 1912 games when both New Zealand and Australia decided to go it alone.

    For the next 60 years New Zealand and Australia developed different sporting paths. New Zealand focused on rugby and cricket, while Australia moved to develop highly competitive sporting competitions in league, Australian Rules and cricket, with a whole host of other minor sports always coasting along in the background.

    It wasn’t until the late 1960′s that New Zealand once again joined an Australian sporting contest, when it sent the New Zealand cricket team to a series of inter-state competitions which started with the vehicle and general Australasian knockout competition and ended with the Gillette Cup.

    This was the first time New Zealand won an interstate Australian competition in any sport. The experiment with New Zealand competing in Australian interstate knockout leagues in cricket lasted only a few years before it was discontinued and New Zealand cricket decided to focus on its internal competition.

    Rugby was the next sport to embrace the spirit of trans-Tasman competition, with the start of the South Pacific Rugby Championship, encompassing NSW, Queensland, Auckland, Wellington, Christchurch and Fiji.

    This competition has undergone many transformations throughout the years, most notably Fiji dropping out, the New Zealand teams being converted into the regional sides, the addition of South African teams and the addition of three more Australian teams.

    All of these changes have now resulted in what we all know as the current Super Rugby competition.

    League was the next competition to embrace trans-Tasman rivalry when in 1995, the Australian Rugby League invited the Auckland (now New Zealand) Warriors to join the competition. This had a significant effect on league in New Zealand, which has since continued to rely heavily upon the ARL/NRL for its survival.

    The Warriors have continued playing in the NRL and have made the final on a few occasions.

    The Auckland Breakers were the next team to make an appearance in an Australian sporting competition, when they were invited to join the NBL in 2003. They have had some success and have finally been credited with being the first New Zealand team with winning a non-state based Australian competition.

    In 2005 the New Zealand Knights joined the A-League. This however was short lived when the team went completely bust after only one season of competition.

    The license granted to the New Zealand Knights was retained and awarded to the Wellington Phoenix in 2007, which incidentally was the same year that the trans-Tasman ANZ Championship was form for five New Zealand and five Australian netball teams.

    This has led us to the situation we are in today, where several New Zealand sporting teams are heavily involved with or in Australian sporting competitions.

    So why is New Zealand involved in these trans-Tasman sporting competitions? And more importantly, why does Australia allow New Zealand to use its sporting competitions to further develop its own sporting credibility?

    What advantages do these trans-Tasman competitions provide?

    I think it’s fairly obvious what New Zealand gets from adding its teams to the Australian sporting competitions.

    With New Zealand’s relatively small population and economy and many of these sports being fully professional, it would be almost impossible for New Zealand to fully fund professional sports.

    So from a New Zealand perspective, it makes sense to send our teams across the ditch. This then leaves the question of what do our Australian cousins get from the relationship?

    I don’t think there is a single answer to this question and it is my personal opinion that there are many factors driving Australia to look to New Zealand to supply a team – or in some cases many teams – to their sporting atmospheres.

    I believe the first reason is that New Zealand teams provide a different way of thinking about their respective sports.

    In many sports, New Zealand has had to think outside the box for tactics that have often resulted in rare victories. This different way of thinking has brought a unique style of game that not only challenges the current Australian teams but also exposes them to different ways of playing sports.

    The second reason that Australia looks to New Zealand is that this new sporting relationship has developed alongside the development of Closer Economic Relations (CER), the economic agreement between New Zealand and Australia that moves the Australian and New Zealand economies closer together. This has set the pace for uniting the sporting cultures.

    With the streamlining of the economics behind the scenes, this has allowed for greater ease of travel and player movements between teams. With the respective governments prepared to continue developing the relationship on economics, military, defence and disaster relief, New Zealand is now being treated by the Australian government more and more like a rogue state.

    Last but not least is money. Before the latest TV deal for the NRL, it was estimated that the SkyTV agreement with Australian League was worth 16% of the total NRL deal. Of course the new deal is going to change that percentage, as the NRL will not secure the same percentage from Sky as they once had, but any raise in Sky funding will contribute significantly to the NRL’s coffers.

    A little about the TV market in New Zealand

    As I’ve just pointed out, the NRL deal is significant but this does not only apply to the NRL. SkyNZ stumps up the cash for an ever increasing number of sports.

    With no laws in New Zealand protecting the individual’s right to view their favourite sports on free to air TV and an larger number of households purchasing SkyNZ than ever before, it has become increasingly strategic for SkyNZ to buy up the rights to any sport which might hold a smidgen of popularity in the New Zealand market.

    But just how popular is Sky?

    New Zealand is estimated to hold around 2,800,000 TV sets with SkyNZ being present in some form in around 880,000 of those households. TelstraClear TV, which leases SkyTV’s channels, adds to that figure with a further 150,000 subscribers. This means that around one million New Zealand households have access to some form of pay TV.

    For a population so small, this is a remarkable figure and is starting to negatively impact the free to air market. Sky dominates the New Zealand TV landscape in a way no free to air TV station in New Zealand can do.

    This can be seen by the profit figures of Channels One and Two, New Zealand’s largest free to air channels. Channels One and Two together made a profit of around two million dollars in 2011, this cannot compete with the 100 million dollar profit made by SkyNZ for the same period.

    It is obvious therefore that SkyTV holds a great deal more purchasing power than its free to air counterparts, pushing out all other current possible competition in the market. With its hold over the TV market, SkyTV is not about to give up its rights to sporting coverage.

    With Australia being able to buy into this, they gain the advantage of being able to show their sporting competitions on New Zealand television, an obvious advantage to them.

    By allowing New Zealand’s teams to enter their competitions, this increases the likelihood of interest in their sport when shown on SkyNZ. This all amounts to an increased revenue for Australian sports.

    How might this situation change?

    As New Zealand further integrates itself into the Australian economy, it is not outside the realms of possibility that the TV airwaves will be opened up to further competition from the other side of the Tasman.

    It’s entirely possible that with such an opening, Foxtel and Sky might be competing against each other in the future or Fox could even buy out SkyNZ entirely. We might see Channels Seven, Nine and Ten from Australia transmitting in New Zealand or conversely New Zealand’s Channels One, Two or Prime transmitting to Australia.

    The opening of competition between the two markets and the deregulation of the TV market in both countries in general could end up to be a game changer as big sponsors who work on both sides of the Tasman will increasingly look to sport for their promotional activities.

    If such a situation was to occur, it would raise intriguing possibilities for the future of sport for both nations. How the sport rights could play out is anybody’s guess but it’s entirely possible that the New Zealand Rugby Union could end up negotiating with Channel Nine in the future for access to the ITM Cup, Super Rugby and All Black games rather than relying on Sky for its source of TV generated money.

    The future of trans-Tasman sporting competitions

    What lies ahead for trans-Tasman sport is anyone’s guess, so I will try to focus on some of the finer points of my argument.

    So far we have successful trans-Tasman competitions in rugby, netball, football, league and basketball.

    The ANZ Championship in netball is probably the most successful of the trans-Tasman competitions. I argue this because it does not rely heavily on any one nation and each nation has an equal share.

    It started out with a minimal payment from SkyNZ and Foxtel, but it now lives on Channel 10 in Australia, SkyNZ and TVNZ Channel 1. The deal is still tiny but it does produce $1.5 million AUD to pay the players with a set cap of $500,000 per team and the top players having the capacity to earn $50,000.

    The success of this competition however, is that it has grown in popularity with ratings in New Zealand higher than ever before. In netball’s international competition, some Silver Ferns games rival rugby for popularity and of course with higher TV ratings this means that the top players have to ability to earn more money. With this in mind, it is not unfeasible to predict the netball competition becoming fully professional in the not too distant future.

    League has had the Warriors involved in its competition since 1995 in what was a risky move to begin with. It proved the concept of a New Zealand team based in New Zealand could work in an Australian competition.

    The Warriors have thrived, generating additional income for the competition and raising the competition’s profile in New Zealand. No one can call the Warriors anything other than a complete success and the fact that Sky is currently paying $14million a year and increasing this to $20 million, shows how the competition has entrenched itself in the New Zealand psyche.

    The Warriors experiment has been so successful in fact, that league supporters on both sides of the Tasman are calling for an additional New Zealand team to be added in an attempt to further expand the reach of the sport.

    After the failure of the New Zealand Knights, the Wellington Phoenix picked up the license. This club has proved to be far more resilient than its predecessor.

    Football is a popular sport in New Zealand and it has a commanding reach but I doubt the A-League will attempt to expand further into New Zealand as it only plays a minor role in New Zealand’s sporting culture.

    Basketball has seen a revival in New Zealand due to the Breakers playing in the Australian NBL and recently winning the 2011 competition. With Sky being happy with the TV ratings of this sport, the question remains; will the competition expand further into New Zealand?

    As with A-League, I doubt the NBL will be interested, despite the increased ratings, as the competition still remains small in popularity compared to other competitions in New Zealand.

    Rugby union is always a complex one, as it is the one sport in New Zealand which generates a lot of its own money without the help of its trans-Tasman friends. However there is a significant benefit for New Zealand to be involved in Super Rugby.

    It exposes Australian Rugby lovers to our top rugby players and has allowed the generation of additional funds through the Rugby Championship/Super Rugby TV deal. Furthermore, Foxtel in Australia has been secured rights to the ITM cup, generating additional funds to the competition and proving that there is some interest in the competition for Australian fans.

    Is this then the time to reverse the situation where Australia provides teams to a New Zealand competition, especially after it has just signed its new sponsorship deal with AIG, opening up the possibility of further expansion?

    Having their own teams to support might increase Australia’s interest in the game and could even offer more funding in future rights deals with Foxtel.

    What about sporting competitions which have no team from New Zealand?

    At this stage, only the AFL has showed an active interest in promoting their game in New Zealand, with one AFL team securing a deal to play a handful of games over the next few years on New Zealand soil.

    But what are the possibilities that have not yet been brought into the trans-Tasman sporting spotlight?

    New Zealand and Australia could once again combine to send one Australasian team to the Olympics especially after New Zealand’s performance in 2012.

    Cricket might see additional revenue by exploring a regional based competition, as has worked successfully for netball and rugby.

    How about field hockey competition? Both countries have good local hockey competitions and this could be further enhanced by pooling resources and sharing talent pools from both countries.

    There are also sports where New Zealand could benefit from direct Australian involvement; swimming being a prime example where New Zealand’s top swimmers could become more actively involved in Australian sporting culture. Rowing could be the reciprocal, with New Zealand demonstrating unique abilities over the last several years.

    Conclusion

    I believe New Zealand and Australia have benefited greatly from the close relationships we have shared in the sporting arena. We are among the top nations in the world in rugby, league and netball, and we have made massive improvements in recent years in football and basketball.

    With the current sporting environment our nations will continue to dominate and improve in the world sporting arena and I can only imagine how much further our nations could go if other sports choose to replicate the successful integrated models employed by rugby, netball, league, football and basketball.

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