V'landys dismisses reports AFL got a better deal out of TV partners
When NRL-loving New Yorkers woke in the early hours of yesterday to watch the Sea Eagles versus Broncos clash on Fox Sports 1, they found an AFL match screening instead on the Murdoch-owned US network.
Matt Astill, a former lower-grade Manly player and past owner of a popular Manhattan bar, said, “I got up this morning to watch my 'tails and it was bloody Collingwood v Richmond! I turned it back to the Korean baseball on ESPN!”
It was not the only victory the AFL appears to have won overnight.
Moments before the kick-off of the resumed AFL season at the MCG Thursday night,
chief executive Gill McLachlan announced a revised TV deal which Melbourne media has declared superior to the arrangement ARLC chairman Peter V’landys negotiated with the NRL’s broadcast partners.
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V’landys dismisses the reports, saying, “Nobody is correctly reporting what our deal is and I’m pleased they’re getting it wrong because it shows both us and our broadcasters have maintained commercial confidence.”
For two weeks now, the AFL has been briefing contacts that the NRL was short-changed in its revised deal with Nine Entertainment Co. (the owner of this masthead) and Foxtel.
Such boasts could not realistically be made unless the AFL was confident of achieving a better outcome at a time broadcasting rights worldwide are coming down and sport has been impacted by COVID-19.
The AFL conceded a discount roughly half that agreed to by the NRL after negotiations with its broadcasters, according to reports.
The reduction the AFL granted their long-term FTA rights holder, Seven West Media, on its $150m annual payment was reported as 19 per cent, or a $87m benefit to Seven for the period 2020-22.
Nine reported to the Stock Exchange it had saved $27.5m in each of 2021 and 2022, the final two years of its five-year contract with the NRL.
This represents a 23 per cent reduction on Nine’s $120m average annual payment, although the discount for the shortened 2020 season is reported to be greater. However, while Seven has also won a two-year extension, now owning AFL FTA rights until the end of the 2024 season, Nine declined to renew their NRL rights past 2022.
Seven’s extended deal is reported as averaging a cost of $147m a year, only a fraction less than what the 2017-22 contract specified.
However, V’landys insists, “We’re very confident what we’ve done, more so now after seeing what Seven reported to ASX.”
Insofar as Seven’s net debt sits at $541m, while Nine has a superior balance sheet, it would appear the AFL’s long-term broadcaster has been more desperate to retain their rights than Nine, despite the NRL grand final and State of Origin matches filling four of the top five TV programs nationwide, annually.
The AFL was not able to secure an extended deal with Foxtel, presumably because it would not agree to the discount its pay TV partner sought.
Foxtel is reportedly paying $30m a year less for 2020-22, the remaining years of its $1.3 billion, six-year contract.
However, V’landys awarded Foxtel a five-year extension for an undisclosed fee, handing the Murdoch-owned network NRL pay TV rights until 2027.
V’landys refuses to reveal the amount Foxtel paid, or the discount it received for 2020-22, but industry sources say the extended deal is consistent with the $1.1b over five years Foxtel paid the NRL before COVID-19 hit.
Analysts say that unless the Foxtel annual payments have CPI adjustments, the real value of the 2027 fee will be significantly less than the payment made in 2018.
The AFL also announced a continuation with mobile rights holder, Telstra, paying $50m a year. Telstra, who pay the NRL $20m a year under the existing deal, recently announced they had not been party to the revised deal with Nine and Foxtel.
Past broadcasting rights deals have been trumpeted in the media down to the last decimal point of the billion-dollar figure but, with the NRL yet to secure an extended FTA deal and the AFL yet to join with Foxtel in a long-term pay TV deal, comparisons are guesstimates.
Nevertheless, V’landys insists his TV dealings have secured the long-term future of the code.
“The proof is in the pudding,” he says. “We’re giving NRL clubs more money, the players have only taken a 20 per cent cut and we’ve got no borrowings. We’re very comfortable where we are at.”
https://www.smh.com.au/sport/nrl/v-...-deal-out-of-tv-partners-20200612-p5521d.html
