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Last week, I was looking through the sports sections of the two major Sydney newspapers, The Sydney Morning Herald (Fairfax) and the Daily Telegraph (News Ltd). What I found were two different headlines and stories related to the NRL TV deal.
Over at News Ltd, under the headline “NRL much hyped $1billion broadcast deal unlikely to be realised“, the story written by Paul Kent, began with “Blame it on the AFL. Channel 9 and Fox Sports lodged independent bids for the game’s new television rights to begin next year but it was considerably less than $1 billion it sought”
I found the headline and article very disappointing on a number of fronts. Firstly, the article was trying to start a code war and blame the AFL for the NRL receiving a lower figure.
It stated that there are fears that Seven and Fox have paid “overs” for the AFL, which would therefore mean a lesser deal for the NRL.
From all other reports, the simulcasting part of the agreement for the AFL is working successfully. With only six months into a five year deal, it’s early days, however, in a couple of years time we may see the deal’s true value. But at this stage for the AFL, so far so good.
Secondly, Paul Kent has forgotten to realise that both codes have very different content. The AFL has an 18 team competition for five years, while the NRL may have an 18 team comp in the last two or three years of its deal. The NRL also has State of Origin, Tests and All Stars. The AFL doesn’t have rep football (unless you count International Rules).
Thirdly, the weirdest part of the article: “If the NRL rejects the bid, as is likely, Nine and Fox Sports will next come together to see if they can provide a joint agreement before the NRL goes to an open market.”
Nine and Fox have already lodged independent bids, as was mentioned very early in the article. Nine and Fox’s three month negotiation exclusivity is over and the NRL is already on the open market with Channels Seven and Ten entering the fray.
Paul Kent’s article is all over the place. A real pity because in the past, I’ve actually enjoyed some of his work and does talk common sense when he wants to, or is allowed to, depending on the mood from his employers.
Over at the Herald, the headline was “Ball in the air as Nine and Fox bid $1b for league” in which the story, written by Brad Walter and Julian Lee commenced with “Channel Nine and the pay TV programmer Fox Sports will have to wait three months to see whether their $1 billion-plus bid for rugby league broadcast rights has been successful.”
Already, there’s a point of difference with both articles from the start. News Ltd says $1 billion broadcast deal unlikely to be realised, while at Fairfax, it suggests that Nine and Fox bid $1b for the league.
Confused! Well you’re not the only one.
The Fairfax article points out a couple of things. Firstly, “Nine has first and last rights on the bid, but only if another bidder does not exceed Nine’s initial bid by 20 per cent.Seven and Ten have until August to come up with a better offer for the five-year contract.”
This is Seven’s best opportunity to either deny Channel Nine any NRL, or make Channel 9 pay overs, and Seven and Ten have until August to finalise their respective offers.
What was then interesting about the Fairfax article was the difference between AFL and NRL advertising revenue. In 2011, the AFL managed between $115 to $125 million, while the NRL was closer to $100 million.
I found that to be the most revealing part of both articles. Here is my take on things.
The AFL achieved those figures ($115-$125 million) with four free to air games per week with consistent nationwide coverage. The NRL figures (near $100 million) were achieved with three free to air games per week, rep football and coverage in just two states.
What’s positive for the NRL is there are a few ways that the NRL could improve its ad revenue. The NRL may allow broadcasters to install more ads in existing stoppages of play, and increase the half time break from 12 to 14 minutes. The NRL could go from three free-to-air games to four, and provide nationwide coverage on FTA digital channels in the southern states.
With that in mind, it is very possible, that the NRL can increase its ad revenue share, and therefore be in line for a $1 billion deal.
Now getting back to the headline of my article: who do you believe out of News Ltd or Fairfax?
I certainly found the Fairfax article informative, while with News Ltd, the article was written in an agenda driven spin piece, while trying to inflame a code war in the hope it would sell newspapers and online clicks. There may be an element of truth that the NRL may not get a billion dollars, but the way the article was written was very shallow, and it lacked facts.
From my point of view, I have to go with Fairfax. I would certainly follow journalists like Brad Walter. Key point of difference is, Fairfax is independent, and wasn’t involved in part owning the NRL, while News Ltd was, and may have an axe to grind.
At the end of the day, its all guesswork on the part of the journalists as far as the dollar figure of the tv deal is concerned. When David Gallop announces a press conference and reveals the deal, that’s when its official.
If the NRL got a figure of over $900 million, ($1 billion plus would be nice) that would be great, especially for a 16 team competition to start with. It would double what the NRL got last time. In that context, I’m sure many people out their would love their blue chip shares to double over a six year period.
The NRL is blue chip code in Australia, and critics shouldn’t think otherwise. However, News Ltd, Nine and Fox in my opinion have been treating the NRL as a victim for a very long time. I hope Seven and Ten treat the NRL as a leader.
That’s what many NRL fans would want.
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