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Thread: Why rugby's broadcast rights imbroglio will go into extra time

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    Why rugby's broadcast rights imbroglio will go into extra time

    Why rugby's broadcast rights imbroglio will go into extra time

    By Georgina Robinson
    February 6, 2020 — 7.40pm

    Rugby Australia officials remained confident on Thursday their unprecedented decision to test market interest in the code's broadcast rights would not blow up in their faces.

    The game was rocked by a report on Wednesday night that Fox Sports had decided to walk away from the sport after a 25-year relationship as its host broadcaster.

    In fact, there was no new development on old tensions, which were first laid bare by the Herald in November. Then, as now, Foxtel bosses were incensed by RA boss Raelene Castle's decision to put the rights out to tender instead of accepting Fox Sports' first offer.

    But as of close of business on Thursday, the broadcaster had not conveyed any such message to RA.

    Last week, Castle's chief strategists, Shane Mattiske and Michael Tange, were in Fox Sports's Surry Hills offices for a meeting to discuss the upcoming process, which was being held up by a bidding war (also between Fox Sports and RA) over the Shute Shield.

    On Thursday, Fox Sports chief executive Peter Campbell issued a statement reaffirming the broadcaster's commitment to the sport for the final year of the current deal, but stated that the rights beyond the end of the year were "a matter for Rugby Australia".

    So is Fox "done" with rugby, as News Corp publications suggested on Thursday?


    The short answer is that will only be known when the clock ticks over on the deadline RA puts on its bid process, which has not started yet. Fox Sports will almost certainly not bid early, may not bid at all, or may wait until the 11th hour and make a late play.

    It is worth noting that Foxtel and Fox Sports can play hard ball on rights negotiations when the moment requires it.

    On April 6, 2018, a News Corp publication reported that Cricket Australia's rights hopes were "hit for six as Foxtel, Fox Sports bail". One week later, Seven and Fox were announced as the game's new partners in a record $1.2 billion deal. A Financial Review story on the deal revealed Fox had been quick to anger when it realised its competitors were still in play but some reassuring back-channelling encouraged them to come back to the table.

    Three years earlier News Corp executive chairman Rupert Murdoch had delivered one of the most famous lines in Australian sports broadcasting history. "We’ve always preferred Aussie rules and we’ve always *believed this is the premium code in *Australia," Murdoch said at the unveiling of his organisation's $2.5bn partnership with Seven for six years of AFL rights.

    It was a get-square for what then-NRL boss Dave Smith had orchestrated months earlier, an exclusive $1.2bn deal with Nine, which was struck without consulting the NRL's other partners, Fox Sports and Telstra. The deal ultimately cost Smith his job and Fox and Nine later teamed up on mutually beneficial terms.

    The long answer, however, is that it is not just about the realpolitik of sports broadcasting and who's upset who this time around. While rugby and Fox Sports have enjoyed a fruitful 25-year partnership, neither party is bristling with good health in 2020.

    On Friday, Foxtel is expected to release its half-yearly financial results, which many pundits believe will confirm the subscription television provider has been unable to arrest the downward spiral that prompted its warning, in May last year, that "non-marquee" content was in its crosshairs.

    If the slide in subscription revenue continues, it may not matter how Foxtel chief Patrick Delany feels about rugby and Raelene Castle, or how many Foxtel subscribers have their set top box only because of rugby. It might matter only how much cost Delany can slash from his business. His predictions in the AFR late last year certainly foreshadowed this: "... it’ll be a year for making sure we drive cost out of the business and don’t spend too much capital. A big part of our cost is content. We’ve never had data like we have now, so this theme through the whole of next year is going to be about content pickiness, to make sure we are not over layering content and we’ve got the minimum amount of content to make sure we keep and get subscribers."

    On the other side of the equation is Castle, whose misfortune it is to be the canary down the mineshaft just as sports broadcasting enters its era of reckoning. Not only is rugby the first of the major professional sports to negotiate a new deal in this cycle, it is one of the weakest. The primary competition it is taking to market, Super Rugby, is at a critically low ebb among fans, the Wallabies bombed at last year's World Cup and the Bledisloe Cup is a distant memory.

    Castle, Mattiske and Tange believe they have a genuine suitor in Optus Sport, which would look to team up with current free-to-air rights holders Ten and aim to grow the game among the 19-35 demographic, among whom rugby is still strong. Crucially, the telco appears to be less interested in warehousing content and more interested in using free-to-air exposure to grow its subscriber base, which was expected to edge close to one million mark early this year (Optus reported in August last year it had 700,000 subscribers, a month earlier Kayo reported 382,000). Castle indicated last month how important a better balance of free-to-air and behind-the-paywall is.

    "Whilst we've a great relationship with Fox and they've done amazing things with Super Rugby, there's no doubt the combination that's proven to be successful in the NRL and AFL ... is where you've got some free-to-air access and some behind-the-paywall access. It's something that we think will help us grow the numbers and grow the brand," she said.

    But the central question is whether this is the right time for rugby to be pitting one against the other. Fox's initial offer, made last year, confirms it is still interested in rugby, but the company's results on Friday will indicate how much or how little capacity it will have to go after it.

    Is Optus genuine? Another question that will not be answered until RA kicks off the tender process in coming days.

    The only certainty is that Castle's job rests on what plays out over the next month.

    https://www.smh.com.au/sport/rugby-u...06-p53yey.html

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    Immortal GIGS20's Avatar
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    OK, so now we've heard the spin from both sides of the argument. I wonder if anybody has picked up a phone and said this to the other party.

    For mine it doesn't matter who buys the rights or how much they pay. Super rugby is a millstone

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    Rupert Murdoch wouldn't use his vast media empire in Australia to try and get a leg up in the tender process for the TV right for Super Rugby?

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    Quote Originally Posted by jargan83 View Post
    Rupert Murdoch wouldn't use his vast media empire in Australia to try and get a leg up in the tender process for the TV right for Super Rugby?
    Don't think he'd be too worried either way. The Murdoch's have always preferred AFL.

    That's why they started Superleague and threw about a hundred mill down the Melbourne Money Pit.

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    Doesn't look like it by this report. But who's spin can you believe? They all have vested interests. If only the ARU had a CEO with the smarts and the balls to see FTA's capacity to generate "new business" while SR was still flying high (Everyone around this joint saw it). We'd probably still have a team () . Also the TV ratings would have already demonstrated the folly of throwing more dollars away in Melbourne. Both code's financially disastrous franchises were brought about via the Murdoch Pay TV juggernaut. And how has that worked out??

    Explosive report claims Rugby Australia boss Raelene Castle snubbed $200m TV deal

    Fox Sports bosses reportedly believe Rugby Australia always intended to pull the pin on their pay TV deal in a bid to move the struggling code onto free-to-air television.

    The broadcaster's deal with RA is due to run out at the end of 2020, but talks about a new agreement broke down on Wednesday.

    The current pay television deal, signed in 2015 was worth $285 million, giving RA $57 million a year.

    The Daily Telegraph, owned by Fox Sports Australia's majority owner News Corp Australia, reports that the broadcaster's executives now believe RA's chief executive Raelene Castle never intended to strike a new deal.

    The newspaper said she rejected their opening offer of $200 million, but remained silent for months without indicating her preferred price.


    https://wwos.nine.com.au/rugby/fox-s...-606d8d1d27e2#

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    Quote Originally Posted by shasta View Post
    Doesn't look like it by this report. But who's spin can you believe? They all have vested interests. If only the ARU had a CEO with the smarts and the balls to see FTA's capacity to generate "new business" while SR was still flying high (Everyone around this joint saw it). We'd probably still have a team () . Also the TV ratings would have already demonstrated the folly of throwing more dollars away in Melbourne. Both code's financially disastrous franchises were brought about via the Murdoch Pay TV juggernaut. And how has that worked out??

    Explosive report claims Rugby Australia boss Raelene Castle snubbed $200m TV deal

    Fox Sports bosses reportedly believe Rugby Australia always intended to pull the pin on their pay TV deal in a bid to move the struggling code onto free-to-air television.

    The broadcaster's deal with RA is due to run out at the end of 2020, but talks about a new agreement broke down on Wednesday.

    The current pay television deal, signed in 2015 was worth $285 million, giving RA $57 million a year.

    The Daily Telegraph, owned by Fox Sports Australia's majority owner News Corp Australia, reports that the broadcaster's executives now believe RA's chief executive Raelene Castle never intended to strike a new deal.

    The newspaper said she rejected their opening offer of $200 million, but remained silent for months without indicating her preferred price.


    https://wwos.nine.com.au/rugby/fox-s...-606d8d1d27e2#
    So it would stand to reason that according to FoxSports - The Western Force is worth 85 Million Dollars.

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    Immortal Contributor shasta's Avatar
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    Quote Originally Posted by .X. View Post
    So it would stand to reason that according to FoxSports - The Western Force is worth 85 Million Dollars.
    I suppose you could look at it that way. Maybe.

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