In Australia, we now have football content straddling three streaming services in Kayo, Optus Sport and now Paramount+.
Would it be viable financially for an ambitious broadcaster to bring most of this content under one roof to create a true home for football in Australia?
In commenting on Channel Ten’s belief that it can make football the most popular sport in Australia, Beverley McGarvey, the chief content officer and executive vice president of ViacomCBS Australia and New Zealand, said: “It’s good to have a big ambition like that. We’re not in this for a quick win. This is something we will build together with our partners… Being the number one sport in Australia, that’s not going to be true by next year. But I think it’s a good ambition we can work towards and this is kind of where it starts for us.”
This will of course be music to the ears of football fans all over Australia, but how might ViacomCBS look to achieve this goal in practice? It is prescriptive that McGarvey talks about making “the sport” number one in Australia, rather than the A-League becoming the number one competition.
Recent crowd and TV numbers (for what has been an excellent A-League season) have shown all stakeholders it will need to be more than just the A-League and W-League that gets football in Australia to the promised land.
The Socceroos and Matildas are, as James Johnson says, strong brands, but the intermittent nature of their scheduling, as well as unfavourable time zones away from prime time for half their matches, means they will only be able to achieve so much in dragging football into the mainstream in Australia.
So what else can ViacomCBS do in the long term to develop Australian football beyond the content that have already acquired in the last month?
It is usually true in business that you need to spend money to make money, so let us look at the financial state of play as it stands. ViacomCBS are in for $200 million over five years for the A-League, and $100 million over three years for Football Australia-owned content. This means in total, ViacomCBS have committed around $73 million per year to football on the back of these two deals.
Let us then compare this to what competing broadcasters Foxtel and Channel Seven are paying for what is the blue-chip sporting product in Australia, the AFL. In 2015, the AFL announced a six-year deal for $2.5 billion, or roughly $357 million a year. This has since been negotiated down due to COVID-19.
We of course do not know how deep ViacomCBS pockets are when it comes to football, but it would appear that were they to reach their aspirations of being the number one sport in Australia, they just might need to spend an additional $250 million or more a year in broadcast rights.
Let us for arguments sake assume that $357 million a year is a bridge too far for ViacomCBS, however they willing to chip in another $150 million a year on top of their existing $73 million a year spend, so $223 million a year in total. The question then is what might they spend this money on, and where can value be created in existing acquired rights?
The Premier League and Champions League
ViacomCBS will know that the rights to these two competitions is worth $15 per month to customers, which is near double what they intend to charge for their base Paramount+ subscription. Given this, and the tantalising prospect of creating a true one-stop-shop streaming platform for football in Australia, ViacomCBS must surely be interested in these rights when they become available.
The question is can they fit within our hypothetical budget of $150 million a year? The Sydney Morning Herald reported in February that Sportsflick’s ill-fated Champions League bid was worth $60 million over three years, or $20 million a year. To be conservative, let’s assume that ViacomCBS end up paying $30 million a year for these rights, due to fierce competition among other broadcasters.
What then of the Premier League? Roy Morgan reports that Optus’ original deal was $63 million a year. Again, let’s imagine competition was fierce for these rights with Optus refusing to go down without a fight, and a deal was struck between ViacomCBS and the Premier League for $90 million a year.
By this point, ViacomCBS could be up for around $193 million a year, still significantly less than the reported $323 million a year the NRL received prior to being negotiated down due to COVID-19, and well short of the $357 million a year the AFL currently receives. For this amount, a true home of football has been created by ViacomCBS, bringing Australian and European football together again once more.
By this point, ViacomCBS might decide that an approximate $200 million-a-year investment in football is no longer sustainable under the $9 per month base subscription fee. To generate additional return on their investment, a Paramount+ sport add-on package is created for $10 per month.
To access this package, a customer must hold a base Paramount+ subscription for $9 per month, which means that it will cost football fans in Australia $19 per month to unlock football nirvana. A mere $4 per month more than Optus Sport, but still $6 per month less than Kayo.
But what is that you say? We still have $30 million of our budget to spend on football content. Beyond the Champions League and Premier League, where else can this money be invested?
A national second division together with promotion-relegation playoffs
It is at this point in the article that I double-back over well-trodden territory of a national second division and promotion and relegation. The conversation usually ends up with several posters vehemently doubting the financial sustainability of such progress, but if you have read to this point, indulge me further while I have my own crack at it.
According to the Australian Association of Football Clubs (AAFC), expected streaming revenue for a national second division is initially expected to bring in somewhere between $300,000 and $500,000, which to some might seem ambitious even still.
This amount was quoted prior to any broadcasting announcements being made between ViacomCBS and the APL or FA. With recent developments, football in Australia has a broadcast partner that fundamentally believes in football (their words, not mine) and so it is suddenly not impossible that ViacomCBS might part with a $2-3 million a season for a national second division competition (pocket change in relative broadcasting terms to be sure).
Such an investment would be of more symbolic rather than commercial value. Any of us that have tuned in to YouTube to watch NPL or early-round FFA Cup matches (such as I did the other night) will know the viewers are numbered in the hundreds not thousands, let alone tens of thousands. It is an uber niche product.
However, as ViacomCBS have already committed to broadcasting the FFA Cup from the round of 32 onwards (including televising the final on one of their free-to-air channels, a result none of us expected), it is reasonable to suggest that granting further exposure to those teams regularly competing in the FFA Cup by obtaining rights to a second division could have an excellent synergy to it for these clubs, at a reasonable cost (much like there is a synergy between the A-League, Asian Champions League and FFA Cup, as A-League teams compete in all three competitions).
Being that the APL are now in the business of producing matches, I’m sure they would be interested in producing these matches for FA (to then sell to ViacomCBS), at a cost. These matches could be kept behind a paywall, and it could just be that only four of the eight weekly matches are produced and broadcast, rather than wall-to-wall coverage.
Regardless, this would put NPL clubs back on the national stage and give them the platform on which to grow, especially when related magazine-type shows are developed. It would be extremely powerful for one platform to show the Australian second division and first division competitions (as well as the knockout cup competition that links the two) all in one subscription cost.
But what if this competition could be funded without a cost to ViacomCBS or FA? Since 2017, Fox Sports received $40 million in funding from the federal government to increase coverage of women’s, niche and community sport over a five year-year period. Looking at the guidelines of this agreement, this included both the FFA Cup and Matildas.
This government program has been much publicised and criticised, with Foxtel chief executive Patrick Delany commenting at the time: “only Foxtel has the production capability, channel capacity and OOT and digital platforms to provide thousands of hours of coverage of women’s and under-represent sports.” With the advent of Paramount+ (and Stan Sport before it), we now know this is no longer the case.
Should similar funding be made available to broadcasters in the future, could they not be used by football administrators to bankroll a national second division competition? Unlike Foxtel, who received these funds and then put the content (mostly) behind a paywall, charging taxpayers twice to view the content, might Paramount+ and Football Australia do the honourable thing and give these matches away for free if they are not liable for the production costs?
So, it just could be that a national second division, via ViacomCBS’ vision for Australian football, and coupled with potential grants from the federal government, might be financially viable. Football Australia would certainly hope so. This then leads us to much discussed topic of promotion and relegation between the A-League and a second division.
In considering the viability of promotion and relegation, I don’t think it can be overstated the power of the A-League, second division and FFA Cup all being broadcast on the one platform (a platform with a stated passion for football moreover).
Traditional NPL powerhouses would be able to build their brands via not one but two competitions, the second division and FFA Cup. This means that any team that achieves promotion to the A-League won’t be coming in totally cold to everyday viewers, they might just be a known brand with an established identity (to love or hate depending on where your allegiances lie).
Likewise, any team relegated would not be banished from Paramount+ to an entirely different platform (like YouTube), they would remain watchable in the second division via the exact same subscription fee. As the second division is on sound financial footing due to a generous (but modest) TV deal coupled with federal government grants, a relegated club can focus simply on winning the second division and getting back in to the A-League.
Promotion and relegation would also add value to the A-League product ViacomCBS have already paid for, as further intrigue would be added to those match-ups featuring relegation threatened teams, which are currently mostly forgettable when no team is at risk of being relegated (unless of course you love seeing Melbourne Victory ‘winning’ the wooden spoon).
Moreover, by implementing a playoff series between the bottom four A-League teams and the top two second division teams, an additional five games of tense content can be developed out of thin air for ViacomCBS to broadcast.
In this promotion and relegation playoff series, matches between 13th and 16th and 14th and 15th in the A-League could be scheduled (assuming a 16-team league), with the winners of these match-ups safe from relegation. The two losing teams would then playoff, with the winner of this match-up again safe from relegation.
The top two teams in the second division would play off for the right to play the twice-losing A-League team to decide the 16th A-League position for the following season. Implementing such a playoff series, aside from developing cutthroat content for ViacomCBS, builds in an additional safety valve for A-League teams at risk of dropping down.
According to this model, each of the bottom four A-League teams would simply need to win one of three matches (including potentially one against a second division team) to stay up for another year. If they cannot achieve that, they do not deserve to remain in the top division.
This playoff format also ensures that the best 16 teams in Australia compete in the A-League each season, rather than gifting spots as a matter of course as in England. For example, is freshly promoted Brentford a better team than freshly relegated Fulham? It is hard to say, as these two teams did not playoff to decide it categorically.
Another bone of contention with promotion and relegation is the idea that existing A-League clubs allowing promotion and relegation is like turkeys signing up for Christmas. It has been stated previously that the clubs’ licences have a provision for promotion and relegation, but in any case, the authority to implement promotion and relegation remains with Football Australia since the clubs gained their independence.
Being that Football Australia stands to gain a bit by implementing promotion and relegation (promotion-relegation playoff games to sell to ViacomCBS, increased competitive tension as teams in the second division jostle for promotion spots all season long, as well as the prospect of A-League teams featuring in the second division), you would hope it is on the agenda in the long term (ten-15 years from now is totally fine).
How then to calm the fears of the existing 12 clubs of the daunting prospect of relegation in the meantime? Once a second division is up and running for five years, allow promotion to the A-League (with no relegation) for four second division teams, to bring the competition to a 16-team model.
This then creates a buffer for the A-League teams between performing poorly in a given season and actually being relegated. That is, you only need to finish 12th out of 16 to be safe for another year. Put another way, you only need to finish above the four previously semi-professional teams to stay up. Again, if you can’t achieve that, you deserve to go down.
So to summarise, it might just be that for an outlay of $1-2 million from ViacomCBS, they could get broadcast access to eight second division matches per week, five promotion and relegation playoffs per season and increased interest in (previously forgettable) A-League matches featuring teams at risk of being relegated.
Add in the prospect of the APL producing these matches and collecting a fee from FA, and potential government grant funding to underwrite the competition, and a national second division competition might just be appealing for all parties concerned. From there, a promotion and relegation playoffs series between the second division and the eight member federation NPL leagues could also be broadcast.
The Asian Champions League
While it is important to respect others’ opinions on such matters, I find it genuinely perplexing that some Australian football fans (and posters on this forum) do not hold the Asian Champions League as anything but the pinnacle of football in this part of the world (except of course the Club World Cup).
I understand that these are midweek matches featuring teams or players most fans are not familiar with, and Australian teams have really struggled to compete in recent seasons.
To me, this simply represents a growth opportunity. It should absolutely be a goal of the APL to collectively get above Thailand in the allocation rankings, so as to obtain four spots in the competition each season.
Why? The more Australian teams in the competition, the more content for ViacomCBS to broadcast (at no extra cost). The more Australian teams in the competition, the more chance of success, which in turn could lead more opportunities for promotion across Channel Ten.
Aussie Davids up against Asian Goliaths is the exact kind of narrative a program like The Project would love to tell. Consistent performance in this competition would give an air of legitimacy to not just A-League clubs, but Australian football in general.
By this point we have seen ViacomCBS invest around $193 million to broadcast the A-League, W-League, Socceroos, Matildas, FFA Cup, Asian tournaments including under-age tournaments, the English Premier League, the UEFA Champions League, Asian Champions League as well as a national second division with promotion and relegation playoffs.
Budget per year: $223,000,000
A-League or FA: $73,000,000
Premier League: $90,000,000
Second division: $2,000,000
Total remaining: $28,000,000
A near complete library of football to compel Australian football fans of all persuasions, be they fans of traditional NPL clubs, A-League clubs or European clubs. This might just be worth $15 per month as an add-on package to football fans (with the need to fork out $9 per month for a base Paramount+ subscription of course).
Beyond this, ViacomCBS could use the outstanding $28 million a year in our hypothetical budget to obtain rights to the European Championships, other European leagues, World Cups and the Club World Cup, which is expanding to 24 teams in future years with eight spots granted to European teams.
Australia should bid to host this competition in a future year and grant a spot to the winner of the A-League in the previous season. I can’t imagine SBS will be too keen on a bidding war for the World Cup when push comes to shove.
Of course, you may just have spent the last half an hour of your life reading total hot air and fantasy, but I would again refer back to ViacomCBS’ stated ambition of making football the biggest sport in Australia – their words, not mine. To do this, money will need to be spent beyond what has already been committed.
In spending money strategically, uniting the various supporter groups that exist in Australia (NPL fans, A-League fans, European fans) under one ‘home of football’ platform should be the guiding philosophy. The actual figures might in reality be higher than those quoted in my article, but should surely come in cheaper than rights for the current industry leader in the AFL regardless. There might just be a viable model out there somewhere to bring football together in its near totality.
And were the above strategy prove to be more fact than fiction, there is no guarantee of football’s safe passage to number one in Australia. AFL and rugby league are true institutions in our country, although NRL is resembling something of a wounded beast at the moment with their concussion issues and blowout score lines.
To reach its potential, football must stand out from the crowd and show consumers what wonderful products it has, the ones that AFL and NRL can only dream of. Two divisions of 16 teams with promotion and relegation, a national knockout competition involving amateur and professional teams, continental club football with prize money in the millions, world cups that teams need to qualify for.
These are football’s points of difference, and the keys to unlocking its potential.