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There have been a number of articles and comments written recently about whether the next NRL TV deal will reach the magical $1 billion. The arguments for and against have been largely written by two groups of stakeholders with differing biases.
There are those from the code war corner who fear what the NRL could do with a more money behind it. They argue without cause or provocation that the NRL cannot reach $1 billion dollars.
Their arguments usually do not sit well with league enthusiasts who see their analysis as shallow and skewed analysis.
On the other side is the league tragic. They are often fixated too much on what their competitors are doing, and use this as a barometer to gauge what their TV deal should be worth.
They ignore all the inherent governance and internal issues that are holding the NRL back and instead focus on the NRL’s position as the number one TV rating sport in Australia as the reason why the game should be the top earner.
For the record, I often sit in the latter corner, and admit that I am frustrated at times with the limited finance the NRL has at its disposal.
What it comes down to when we sift through all the rhetoric from both sides is that the NRL is only worth what one is willing to pay.
And in this we are left with the big tangled mess that is the current NRL ownership structure. Is it any wonder the NRL is being underpaid when its primary negotiator is its parent company?
While it is true that the ownership structure has been a major roadblock at the negotiating table, the other big influence has been exclusivity.
Exclusivity has been the reason that Channel 9 has hoarded Friday night games, restricting viewership into new territories. This has not only restricted the NRL’s ability to grow its brand, but has hurt sponsorship and other commercial opportunities.
Exclusivity has been the reason that rugby league lovers have not been able to watch decent coverage of Super League for the last three seasons. It has also been the reason that Test matches are not watched in all Australian markets.
Exclusivity gives a safety blanket to a network, allowing them to pick and choose their programming knowing full well that another network cannot capitalise. To date we have seen the self interest shown in markets like Victoria, where our supposed network partner is more interested in protecting rival sports than growing brands which it has the rights to show.
This is both counterproductive to growth and devaluing to our sport. There is no premium that a network can give that can justify exclusivity. All exclusivity does is restrict market reach.
It is this mistake made in our last TV deal that will make it difficult for the NRL to achieve significant growth in any new deal, if they persevere with the same structure (that is, one free-to-air network with exclusive rights, plus Fox Sports).
This is because under our current structure, the NRL has been unable to determine its true worth, and poor viewer numbers in non-strongholds are a major roadblock for the NRL.
The NRL has a real opportunity here to re-engineer the way sports are viewed in Australia. The internet is where the NRL can significantly grow its product and brand. It is also where it can maximise its revenue by reaching a global audience.
The NRL should retain all intellectual property and production rights and build on the league internet channel both here in Australia and abroad. This platform would show all games live and be subscription based.
They should then offer free-to-air rights to three NRL games per week, State of Origin, and internationals. These games would also be available live on the internet platform.
Fox Sports should be offered the same package as it has now, without the exclusivity rights, given content would be shared with the internet platform.
The value of both free-to-air and Fox Sports rights would shrink in the initial stages as the relevant parties objected to the loss of exclusivity. This however would be more than offset by the value with which would be generated from the internet platform.
If produced and marketed properly this has the potential to dwarf any of the current dollar numbers being splashed around, as the NRL will retain all advertising and subscription revenue associated with their platform.
When you do the sums and look at the NRL’s potential market reach both here and abroad, the potential is staggering.
The other benefit that it will have is that it will give free-to-air TV a better understanding of the NRL’s real worth and market pull in Australia.
This is because the NRL will have the capacity and platform to invest heavily in extending its market reach, and the subscription and viewer base will be there for all to see, not skewed or restricted because programs are not shown in certain markets.
Over time this will rebuild the value of free-to-air deals and allow the NRL to maximise coverage and value via all media platforms.
Now is the time to act if we want to grow our game. One thing is for certain, if we maintain the status quo everybody in league circles will be very disappointed come the conclusion of this next TV rights negotiation.
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