Tuesday’s A$2.508 billion AFL rights deal is being heralded as “colossal”, but while it surpasses that of previous deals, it is still far from that seen abroad.
Last year’s nine-year NBA deal, for example, was valued at US$24 billion, with pay TV provider Time Warner one of the biggest winners.
Sporting rights could be the last big money spinner for pay TV broadcasters, due to the fact that consumers watch sports live. This gives the broadcasters an opportunity to present advertisements to a mass audience simultaneously, something which has become harder for the broadcasters in a fragmented media environment.
The value of live sport could have been why News Corp executive chairman Rupert Murdoch showed up at the announcement. Murdoch made News Corp’s position clear:
“This is a very significant investment for us, we’ve always believed that this is the premium code in Australia, it’s the national game…Were also committing all of our platforms to support the AFL everywhere, in every state. We are are very happy to be doing this, we believe in the strength of the game and we will do everything to make it stronger”.
The A$2.508 billion deal, which runs from 2017 to 2022, includes buy-in from Seven, News Corp and Telstra. Unlike the NRL, which only announced part of its expected deal, the AFL waited until all parties were signed and present.
The annual value of the AFL broadcast rights continues to grow, keeping in mind more recent deals have included pay and digital rights. The rights of 1971-75 were valued at A$200,000, 1988-92 A$6 million per year, 2002-06 A$100 million per year, with the current rights valued at A$250 million. The new rights deal adds almost A$170 million per year.
The new six-year deal includes the same media organisations – Seven, News Corp and Telstra, that are involved in the current five-year A$1.25 billion rights arrangement. The deal has exceeded expectations, with one analyst predicting last year it was likely to fall short of the A$2 billion mark.
As part of the new deal Seven will broadcast games in HD, though it hasn’t gained the same streaming rights that the Nine Network did for the NRL. Instead the digital rights were again secured by Telstra.
News Corp’s Fox Sports will have the rights to broadcast all games across the season with the exception of the grand final. As part of the agreement, Fox Sports can sub-licence the 3.20pm Saturday game to a free-to-air provider. It is highly likely this will be offered to Network Ten, which has recently become closely aligned with Foxtel. If the game was offered to Network Ten, it would see the network again involved with the AFL, as it was during 2002-2011.
Unlike Seven, Foxtel has gained rights to broadcast across all devices which could create both competition and some unclear expectation of how the digital rights are defined.
Digital rights
While Telstra has secured the digital rights, Foxtel has said:
“Under this deal, for the first time, Fox Footy will be able to be broadcast on all devices, which means that if you subscribe to Foxtel Play or use Foxtel Go, you’ll now be able to watch all games on PCs and Macs as well as tablets, phones and games consoles.”
Foxtel has also stated:
“If you love AFL you need to be a Foxtel subscriber, and with our recently reduced pricing there’s really no reason not to sign up.”
But it is unclear if the pricing will change from the current structure. The current pricing of the Foxtel Play service is A$25, the sports package is an additional A$25, making the total A$50 per month. It should also be noted that currently the FootyPlay service is not available via Mac/PC, although based on the statement above this will change for the new rights.
So if Foxtel will be streaming all games how does this play against Telstra’s digital rights?
We’re yet to see how Telstra will deliver on its promise to “transform the experience” for AFL fans, and there are already alternative options in the way in which sport could be presented to an audience. It is a case of seeing whether Telstra will utilise any of these or new technologies that will be released between now and when the rights commence in 2017.
In comparison to the Foxtel option the AFL Live Pass currently costs consumers A$89.99 for an annual pass, although there is currently no Apple AirPlay or Google Chromecast option to stream to a TV. A TV streaming option will be available with the new rights via Telstra TV, a new service it will launch in September.
It is clear that Foxtel and Telstra will be competing for subscriptions for the services.
Where’s the future?
AFL CEO Gillon McLachlan says the new deal will allow for growth in the game to “create new generations of supporters, members, players and volunteers”.
The growth in the game was made clear over the weekend when the women’s game between Melbourne and Western Bulldogs averaged an audience in Melbourne of 175,000, in comparison to the Essendon game which averaged 114,000.
These games are not part of the new AFL broadcast rights deal. Despite this Seven West Media CEO Tim Worner has publicly expressed an interest. Given the ratings acquired by the women’s game, it could a tempting alternative for other broadcasters, both free-to-air and subscription.
The high level of interest shown toward the women’s game shows the AFL is expanding and that the broadcasts should expand with it. In the future there could be a secondary agreement associated with the new rights. Seven and Foxtel could broadcast the games via its joint venture, video on demand (VoD) streaming service Presto, to differentiate it from the VoD leader Netflix.
The alternative is a new class of media rights which includes the women’s games along with other exhibition and international AFL games. These rights could be acquired by Ten or Nine, or could allow new players like YouTube to become involved in the broadcast of AFL.
The decision by Telstra to continue to obtain the digital rights for the AFL also raises questions about the NRL digital rights. Will Telstra bid for these or could we see new players in the market to broadcast NRL games across digital streaming platforms?
Marc C-Scott is Lecturer in Screen Media at Victoria University
This article was originally published on The Conversation. Read the original article.
Brian West
Guest
Please don't demean the topic of Australian Football overseas by suggesting selective anecdotal events are in anyway indicative of the situation. To discuss the situation at any level you have to divide countries into four regions. The Southern Hemisphere is easily the most important with significant investment and significant programs. Yes there are 30,000 participants in Auckland and one day you might have the situation in RSA where the 20,000 participants have resulted in 10,000 community players. Of course, the PNG has been playing AFL basically since WW II. North America and the Isles have been targets of AFL recruiting "combines" and Europe has a lot of international action. Asia, the home of the expat driven club is also open to potential in China but probably India is the go.
Floreat Pica
Guest
The later, scratch matches every so often typically on improvised fields with more sand than grass. Still, seems to be on par with the hosting/touring schedule of national teams for soccer and volleyball (also popular)- domestic comps for those are obviously far stronger, but restricted by limited funding and logistics to be region/city-based competitions only. Regular national competitions in team sports across much of the region remains very much underdeveloped (again funding, logistics and marketting) compared with western countries and the affluent few such as japan and korea.
Bruce
Guest
Great story FC, hope you keep it going. My point is that the AFL are like all our politicians....big on hyperbole and self aggrandisement. You have to cut through the BS to find the truth. Is there an actual weekly competion where you live or just pick up teams around Asia??
bart
Guest
Thanks for your continued interest in football Bruce, 100,000 kids exposed to sport is a good thing, variety is the spice of life, even in NZ. 100,000 kids not growing up like you can only be a good thing. Back to your fish and chips dipped in ink Bruce
Floreat Pica
Guest
Oh, and there is not a red cent from the AFL to support this- yet.
Floreat Pica
Guest
Funny how these things start Bruce- in 2007 four of us expats did pretty much exactly as you describe (although Im pretty sure one wasnt just drunk but high) on the dry-season bed of the Mekong in Vientiane and thus the Laos Elephants were born. Two months later with a squad of twenty four we played our first international in the Asian Championships in Bangkok against Hong Kong who would go on to be runners-up in that annual competition. The squad had few nationals then, but its near to 50:50 now and the captain is Lao. In addition to playing annually in the Asian Champs (got our first victory against the traditional rivals the Vietnam Swans in our third game), there is the annual Indo-China Cup (we took it out in our second year) and typically another tour. You're right that its expat and grog heavy- but you leave out that these teams train weekly, typically have an ongoing and growing core of national talent, and are backed by (at least in the case of the 'Phants) a half-dozen of the biggest companies within the countries they represent in sponsorship terms that would only be rivaled by other national teams. Amongst the landlocked Asian regions you mention, organised sporting competitions dont traditionally go far beyond wrestling, archery and equestrian events, so keep in mind that small, drunken steps can go a long way.
Bruce
Guest
Dear oh dear....where does one start! China and India.............I do recall a certain RL competition owned by a certain Rupie Murdoch spruiking China and India decades ago...........that didn't turn out too good. Good luck with China, India and Rupie....lol........it's happening again.....lol.....so funny,.........
Bruce
Guest
Morals....does the AFL have some.....lol.....someone hit me with a wet fish.....just jumped into bed with Rupie.....good luck with consummating that little arrangement .......lol.....
Bruce
Guest
A few points to make: Only AFL zealots believe any of these figures the AFL put out, sad as it is. Even if there were 100,000 kids over a few years put through kiwi kick was does that mean? Thanks for asking barty. It means AFL development officers have been flooding into schools providing free child care to kids who don't even know what they are doing. They then furiously count numbers, multiply by whatever number equates to Gilligans proclamations and voila - more AFL propaganda. The more valid question? Thanks again for asking barty. How many kids are playing real 18 a side games of AFL in properly constituted competitions on weekends. Won't be hard to count that number, its in the hundreds....if that....lol. Anything else barty?
bart
Guest
Read the 2014 Annual report http://aflnz.co.nz/about/ knock yourself out sunshine, about 100,000 kids put through a 8 week kiwi kick program over the last few years, when you do the maths it is quite easy to believe, but believe what you want, it will not impact one iota on either of our lives.
duecer
Guest
Mister Football is right - After Rugby Union there is daylight, then Netball, Soccer, Cricket, Rugby League, but I would say none of those 4 (or others I may have missed) are a clear second, although I too would be sceptical of 30,000 AF players in Auckland
Mike
Guest
MF, Gil has been making this claim about 'playing' numbers in Auckland for a few years. I have a mate who is a school teacher over there, when he first heard this he laughed, now he just says it an outright lie. I suspect these 'numbers' come from AFL sponsored school visits. They are either massive over exaggerations or as my mate says outright lies.
SM
Guest
No clear second sport? Who on earth are you trying to fool here?
Happy Jack
Guest
The NRL will be happy Rupe made a point about AFL coz that means he is willing to deal. News already promote AFL in the northern states (in the tele) especially but what happens if the NRL do deal with Fox - the first thing to go will be AFL promotion in the north. Surely Fox will trade off their FTA game to Nine in a complicated contra with NRL rights if the ACCC doesn't allow Murdoch into Ten...
Marc C-Scott
Roar Guru
I hope that growth is now outside of the main league. As Gill mentioned the next generation, women's league, minor leagues and them being able to establish media rights deals.
Marc C-Scott
Roar Guru
Yes I think the Rupert quote is an interesting one and maybe gives an insight to what could come for the remainder of NRL rights
Mister Football
Roar Guru
Gil talked about the need to priortise India and China, more in terms of the immigration from those countries to Australia, but also working the other way.
Mister Football
Roar Guru
Julie Bishp asked two questions: 1. When will there be an opportunity for Dockers and Eagles to play a grand final in the new Perth stadium. 2. Protecting the base 3. Outlawing kicking backwards. 1. Contracted to play the grand final at the MCG until 2038, maybe after that. 2. Unprecedented level of FTA coverage, every game live on Fox, never been better for supporters to watch the game live. Priority to make the game affordable to maintain attendances.
Mister Football
Roar Guru
Asked about the possibility of international compeition in the future. Gil talked about last year's International Cup, and the quality of the final between Ireland and PNG being of a very high standard, the athleticism of the PNG in particular.
Mister Football
Roar Guru
NZ is definitely on the AFL's radar: they have cricket ovals, they have a strong sporting culture, there is no clear second sport behind Rugby, but there is no suitable oval in Auckland, they have two full time personnel in NZ, they have 30,000 people playing Australian Football in and around Auckland.