NRL expansion is all in the numbers

By Paul J / Roar Pro

Matt Orford passes the ball during the NRL round two.

There are only three things, they say, that are important in real estate: location, location and location. There is an easy translation as to what is important to modern day rugby league: broadcast rights, broadcast rights and broadcast rights

The inaugural businessmen and women of the ARL Commission will be very busy, increasing crowd figures and memberships and fixing out dated scheduling. However, these are not issues as immediately pertinent to the game as a $1 billion payday.

I think it is as safe as a 2011 St George Illawarra minor premiership to suggest that NRL expansion will only occur if it will increase revenue for the next broadcast deal of 2013-2017.

There are only four viable options left in this round of expansion as I see it: Central Coast Bears, Perth, Central Queensland and Brisbane II.

Forget about memberships, Facebook numbers and righting the wrongs of the past on this issue. Here is the ad revenue that the free-to-air networks generated from January to June 2010:

Brisbane: $235,370,035.
Perth: $145,669,616.
Regional NSW: $187,020,165.
Regional Queensland: $102,813,645.

The Central Coast population of 300,000 makes up approx 10 per cent of the regional NSW population of three million, and the Central Queensland population of 200,000 makes up approx eight per cent of the regional Queensland population of 2.5 million.

I don’t know exactly how much the Central Coast and Central Queensland markets contributed to the regional NSW and regional Queensland figures above, but a basic calculation using the relevant populations gives you the following:

Brisbane: $235,370,035.
Perth: $145,669,616.
Central Coast: $18,702,016.
Central Queensland: $8,225,091.

While there are other factors to be considered such as the Central Coast Bears potential to re-engage with lost North Sydney Bears fans from Sydney, the numbers stack up so heavily in favour of Brisbane II and Perth, it would be easy to wonder why there is a debate over NRL expansion at all.

Nine allocates more Friday night games to the Broncos than any other NRL team, except perhaps the Dragons, clearly stating the importance of the Brisbane market to broadcasters. Brisbane II will give the ARL Commission the ability to schedule a Brisbane team to be on free-to-air every round of the premiership, a huge bonus in broadcast negotiations with the networks.

Perth is of course AFL heartland, but sources within the media industry have stated that the networks are willing to pay more if a sport can sell them the illusion of a national competition, which is exactly why the AFL are going ahead with GWS despite next to no AFL support in Western Sydney.

Perth, with its advantageous time zones, also helps the NRL grow the game and increase market share, with this western expansion being bankrolled by the new broadcast deal.

I predict a bumper NRL broadcast deal to begin in 2013 with a staged entry of Brisbane II and Perth shortly thereafter.

Our hearts may go out to the supporters of the other expansion bids, but to find the blueprint for the NRL’s next expansion phase, I’m afraid, it’s all in the numbers.

The Crowd Says:

2012-09-24T23:29:17+00:00

Paul

Guest


Hills is mostly Parra fans. Back in the 90s there were some Bears fans around but it was overwhelmingly Eels

2011-06-16T22:55:49+00:00

Crosscoder

Roar Guru


Silent one.Really interested to find out how you assessed Cronulla, have no juniors,and no sponsors and no crowds(based on this years averages).IMO you got one correct debt.

2011-06-15T14:36:53+00:00

silent.one

Guest


half move the sharks to adelaide and merge the roosters and sea eagles... I know alot of people will be pissed off but atleast none of there teams is being culled just partially relocated and merged to form a join club... this is before they die from debt, no juniors, no crowds, no sponsers etc and for the greater good of the game IMO. also this probably should of happened once peace was made between the arl and news limited (instead of killing the bears, crushers, sea gulls and reds etc).

2011-06-15T14:24:19+00:00

silent.one

Guest


what are the odds of 1 or more part of that happening??? so i over exaggerated and we definitely wont be seeing 2 more nz and a pi side enter within the next ten years but it should happen 1 day... and the sharks will be better off for moving half there operations to adelaide and the eagles and roosters will be better off for merging but i cant them willing to do this unless it is to survive or the IC forces them into it.

2011-06-15T06:18:32+00:00

JP

Guest


Bah, just add 'em to the St George take. Don't see why Cronulla would hate losing all its players to its greatest rival (Bears loved it when Manly took them over, right?) And yes, I speak in jest.

2011-06-15T05:59:50+00:00

Beowulf

Guest


And all those lovely 'statistics' in this article fail to take into account the fact the Bears are a Foundation Club, with multi-generational supporters living right across Australia - a large fan base comes from QLD and a lot of RL fans remember the Bears warmly - they were most peoples 2nd team. hence if they return, THEY WILL BE WATCHED by all these people plus of course the catchment area of 1.1 million. The Bears were the 2nd most wached team in the 90's I've been told. The networks would know the figures and our bid team will let the NRL know it. So throw the pro Brisbane/Perth analysis out the window because you can't measure passion or tradition. The Bears have it as shown by 11 years of fighting for reinstatement. Will Brisbane2 fight on if rejected? Of course not, it will fold due to lack of interest.

2011-06-15T04:34:34+00:00

Mals

Guest


QGIRL "so why would anyone in Brisbane want to support the Broncos" - just may be because they are called BRISBANE Broncos & represent the city in a national rugby league competition. If Manly is kicked out of the NRL why would I go support Canterbury Bankstown?

2011-06-15T04:30:08+00:00

Crosscoder

Roar Guru


QGIRL Sorry champ,have to disagree.Know more than my fair share of people from my marketing days,who dropped of rugby league with the demise of the Bears,Souths,the mergers of the 4 clubs and either did their own thing or followed union and the Swans. The former editor of rugby League week a tragic leagueman left the game,and follows the Swans,as a direct result of the SL war(meaning rationalisation). You can't dismiss tradition and the fan base overnight,and continue to give other codes a leg up.You end up painting yourself into a sporting corner..

2011-06-15T04:22:29+00:00

Crosscoder

Roar Guru


Jaceman. As Tv rights ATM account for $100m of the NRL's total take of $170m ,of course Tv money is vital. That is why it is vital for the NRL to get a team in the west before the market place becomes too crowded. I can only go on the financial info from the Reds bid team,which states if they get the go ahead,they will be among the biggest income earners in the league.Suggesting sponsorship plays a big part. All clubs at the moment get approx $3.8m in grants (don't quote me exactly). The club had 18,000 members and averaged 17,000 approx ,prior to the SL debacle.So 15 years later working on a min of 13,000 average is not over the top. If the code can't get a decent Tv deal,based on the ratings historically achieved,the offerings they have available,the feeling within the media and even News Ltd execs on Fox and other media pundits such as the Mitchells,Manning etc,and even the likes of Gallop,then they should give the game away. The code would do better IMO,if they played a Sunday twilight game,instead of that damn saturday 5-30pm slot.They would get better ratings,better crowds.

2011-06-15T04:09:22+00:00

Crosscoder

Roar Guru


football tragic. Failing financially or losing money.I suggest the latter.The head body does not provide prop up money to clubs that lose money each year.It is up to the individual clubs to sort themselves out.How many football clubs of any code make money each year,not many.They still expand. The Storm are already being supported by News and part of the new deal when the I.C takes over,the club will be backed for the next five years as part of the deal with News decision in getting out. The Titans are in a far better position(they have record sponsporship),and Searle has stated often enough they are a profitable club despite the drop in crowds.They also have a $30m Centre of Excellence which is rented out ,and bringing in additonal income. It is obvious out of the $170m dollars the NRL generates(excluding clubs own income) ,$100m comes from Tv rights So Tv income is a major factor .Every man and his dog expects the code to generate a far bigger Tv deal.Expansion would assist in that.The club grants would also benefit greatly. Having teams in either Perth,Brisbane 2 or the CC ,will not have the NRL having to spend money to prop them up.They have to be self financing.The NRL did not spend $1 in getting the Titans on board. There are other football codes in this country that receive financial assistance from the head body,to start up,or keep their head above water.The NRL does not have to do that. Judging by the number of companies folding in the country Colorado,Angus & Robertson,broadcast income will be even more vital.

2011-06-15T03:58:56+00:00

Col the bear

Guest


Gees no wonder I stay away from this site now. I'm actually out doing something tangible to get the cc and the ns their team and not talking about it. 7000 financial members is what it's about.membership is the deal people.oh and last I saw the new rugby league headquarters are at moorepk Sydney.I'm originally from Qld and even I can see where the headquarters of rugby league are in this country.bring on the CCBears for 2013.both manly and Newcastle will benefit having the bears in the fold and I'm sure Nathan knows it. And I love how the maroon guy continues to call the cc bears bid Gosford just trying to down play the size of the catchment area of the CCBears Which is in fact from kirribilli to lake munmorah with 23 junior clubs .that's when you give yourself away ,that's when you are sincerely worried the bears are going to get in.and that's it mate.. we are doing everything in our power to make that CCBears happen.no backward steps this time .the bears have been put on notice twice now in the past 2 seasons by the NRL to go if cronulla or storm fall over. Why .because they know we are ready. And we bloody well are and they know it.enjoy because the ccbs will .maybe we should call the Brisbane 2bid Albion he he he.

2011-06-15T00:45:35+00:00

voodoo people

Guest


The Reds brand (Ie name, colours and logo) have high recognition both in Perth and amoung Rugby League fans. Why go and pick some other name that doesn't have that connection with the target market? There is a couple of good articles on this topic on the Reds website, one in particular detailing an independent market study the club paid for which found that the Name and colours were instantly recognisable as being the Perth Rugby League club amoung Perthites. Interestingly though, it found that the Kangaroo logo was less readily identified. The CEO of the club went on to talk about the importance of the brand. It is a strong brand, even if you want to knock it for whatever agenda driven reasons you have.

2011-06-14T22:56:22+00:00

Dean - Surry Hills

Guest


Agreed Jason - hence the He he at the start of my list. I usually save the best until last - and Brisbane Brothers definitely has a ring to it. A name like The Brothers might bring out passion similar to The Maroons - with each bloke playing for his team mates and club, rather than for himself like JT does !

2011-06-14T13:35:59+00:00

Queensland's game is rugby league

Guest


"It would impact hugely because the entire fan base of every club you kicked out would stop watching League." A few nutjobs would throw a tantrum and not watch the sport again because they want everything their way, but for the most part people will continue to watch the sport. Most of the people who threaten to never watch the sport again are the ones who never bother to attend a live NRL match. The game isn't any worse off without these sort of "fans". So tell me, why do all of the fans of the old BRL competition still watch rugby league? Shouldn't they be lost to every other sport? The Brisbane Broncos' admission into the NSWRL was the last straw that killed off the BRL, so why would anyone in Brisbane want to support the Broncos? They seem to have a lot of support. Maybe it's because your theory doesn't hold up? The game needs to go forward. It cannot do that while it's carrying excess baggage from Sydney. If a few fans don't like it then tough, they need to get out of the dark ages and realise the world isn't flat.

2011-06-14T12:41:02+00:00

Epiquin

Guest


"Removing 3 or 4 of the clubs would not impact the TV deal because there would still be more than enough Sydney-based teams to feature on FTA each weekend." It would impact hugely because the entire fan base of every club you kicked out would stop watching League. We've learned from the past that when you kick out a team, their fans don't simply say "oh well, I suppose its for the best, I'll just simply invest all my money and passion into one of the teams I used to cheer against and it'll be just as good." I think you are the one living in a dream world, QGIRL.

2011-06-14T12:33:32+00:00

Epiquin

Guest


Where do you think that money comes from mate? Do you think TV networks pay big bucks for something that no one is going to watch? Do you think that sponsors are going to pay to be on a jersey that no one is going to see? According to your 'definition' that Rugby League is a business then fans are essentially customers. Any business that ignores what its customers want and instead tries to tell them what they need is destined for failure. You don't have to be a genius to figure that out. And as for your suggestion that alienated fans should watch other sports, I am yet to hear of any successful business that tells its customers to shop with its competitors. If the Rugby League powers that be shared your thoughts, the whole competition would be dead before the seasons end.

2011-06-14T12:24:10+00:00

Epiquin

Guest


Its not the stance of the bears to "take our bat and ball and go home" if we lose out, it is simply not feasible to keep bidding. The window of opportunity closes and the league community diminishes. I fail to see any evidence or reasoning that the bears will prevent clubs from attracting sponsors. I also don't see how it means they have less opportunity to be on TV since all games are televised and the TV contract is up for negotiation. The bears bid is the one that offers too much to be ignored. Its the only one ready to go as soon as they are given the nod.

2011-06-14T11:33:07+00:00

Queensland's game is rugby league

Guest


You live in a fantasy world Col. It's pointless citing the population of greater Sydney when all other evidence proves the area cannot support 8 or more clubs. You only have to look at how poorly the Sydney clubs are faring off the field to see I'm right. Most of them have been struggling for decades and have been relying on handouts from the NRL for years. Only the Bulldogs are able to regularly draw 20,000+ crowds to their home matches. If the Sydney clubs cannot average 30,000 to the intra-Sydney NRL club matches then something is seriously wrong. If the NRL decided to only keep the 10 strongest clubs in the entire league then six Sydney clubs would be thrown out. Sydney is very important to the game, but not so important that it needs 8 ore more clubs. Removing 3 or 4 of the clubs would not impact the TV deal because there would still be more than enough Sydney-based teams to feature on FTA each weekend.

2011-06-14T11:16:11+00:00

Queensland's game is rugby league

Guest


The number one sport on the Gold Coast is rugby league and daylight is second by a mile, yet the Titans' attendances have experienced a drop in attendances over the last 3 years. The Titans were pretty successful last year yet their attendances were down on the previous year. If the Titans are struggling to maintain their attendances then don't expect the city to get behind a sport that it doesn't care about.

2011-06-14T10:33:11+00:00

turbodewd

Roar Guru


mate, by definition RL is a professional sport and money is what makes it tick. Those who dont like that aspect should watch other sports.

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