Clubs in fight for bigger slice of NRL's TV pie

[El Diablo]

http://www.theaustralian.com.au/new...e-of-nrls-tv-pie/story-e6frg7mf-1226158470527

Clubs in fight for bigger slice of NRL's TV pie

by: Brent Read
From: The Australian
October 05, 2011 12:00AM

NRL clubs will take their case for a greater share of the game's revenue to the independent commission today when they hold talks with the game's inaugural eight commissioners over funding from 2013

The Australian understands the clubs are chasing a guarantee of receiving at least 53 per cent of the NRL's revenue when the new broadcast deal is negotiated, up from the current 37 per cent.

The increase would allow clubs to cover the cost of total player payments -- taking into account the NRL, NSW Cup and Toyota Cup squads with their club grant.

A delegation of eight club representatives will meet the full commission, which chairman-elect John Grant confirmed was on target to take over the running of the game on November 1.

The clubs, most of which run at a loss, want funding guarantees included in their membership agreements, the current versions of which expire in a matter of weeks. The clubs are expected to roll over their agreements for next season before signing new agreements for 2013 and beyond.

They want those agreements to reflect guaranteed funding, most likely in the form of a percentage of the game's revenue. The commissioners have been meeting the game's key stakeholders in recent weeks as they look to get their heads around the major issues.

The financial state of NRL clubs is among the most serious. As many as 14 clubs run at a loss, surviving on hand-outs from their leagues clubs. The clubs see the answer to their problems lying in the distribution of funding when the new broadcasting deal is struck. The game is expected to reap a $1 billion windfall from television rights and the clubs want a reasonable percentage of that to be passed on, helping stem their financial bleeding.

Grant yesterday confirmed the commission would be up and running by November 1. "The formations committee is still focused and committed to November 1 being the transition date," he said.

 

[Loudstrat]

This is so needed.

Not just to increase the salary cap, but to lessen the reliance clubs have on other sources to operate, and maybe invest in promotion, coaching, junior development etc.

News Ltd reimbursing Rupert out of NRL coffers was one of the most audacious and disgusting things of the partnership, and the players lost made us a laughing stock.

 

[juro]

But if the clubs are not reliant on other sources of income, wouldn't the just mean they would ignore those other sources? ie, no promotion for their individual games?

 

[sensesmaybenumbed]

Mmmm..... Pie.....

 

[firechild]

But if the clubs are not reliant on other sources of income, wouldn't the just mean they would ignore those other sources? ie, no promotion for their individual games?

Highly doubtful. The increase in the grant would allow clubs to cover the salary cap. They would still be responsible for covering the costs of coaching staff/facilities/equipment, junior development and several other areas. Having more money than competitors would put clubs in a more desirable position, just look at the money that the Bulldogs have to offer Des that Manly can't match. This could also make the game more attractive for private ownership by making clubs potentially profitable and therefore owners would have a great interest in promoting matches, merchandise, memberships and other areas that will increase their profits. I don't think this can be a bad thing at all.

 

[East Coast Tiger]

Wow, never saw this coming. This has been the agenda of the clubs all along. Goodbye international football. Goodbye grassroots football. The clubs are lining up to take the bread from the mouths of those in the game who are already neglected. The rich stealing from the poor. And yes this will ensure the clubs don't look at sustainable income streams of their own. They're jumping off the teet of pokies and onto the TV dollars, and they were already pretty hooked on the NRL's money to begin with.

 

[juro]

Highly doubtful. The increase in the grant would allow clubs to cover the salary cap. They would still be responsible for covering the costs of coaching staff/facilities/equipment, junior development and several other areas. Having more money than competitors would put clubs in a more desirable position, just look at the money that the Bulldogs have to offer Des that Manly can't match. This could also make the game more attractive for private ownership by making clubs potentially profitable and therefore owners would have a great interest in promoting matches, merchandise, memberships and other areas that will increase their profits. I don't think this can be a bad thing at all.

Yes, I agree that there are positives from clubs being run better. But what has been stopping the clubs from doing more promotion in the past? Giving them a larger grant surely wouldn't be an incentive for them to market themselves better in the future...

 

[Perth Red]

With $1billion plus getting an increase on sponsorship rights etc, reducing running costs of the NRL and consolidating the income sources for the game there should be no reason that the club grant can't go up to around $6-7million per club. I wouldn't be giving them 53% or any defined % of income but as long as the grant covers all playing costs then they should be happy with that. That would cost the NRL in the region of $108-126mill a year (presuming we go to 18 teams) leaving a healthy equivalent amount to run the game, develop grass roots , market properly, expand and support developing nations.

Having said that it won't long term solve the problem of clubs who still run like amateurs or have very small fan and corporate appeal, but no amount of central funding will imo.

 

[Eels Dude]

But if the clubs are not reliant on other sources of income, wouldn't the just mean they would ignore those other sources? ie, no promotion for their individual games?

Well that costs money in itself.

 

[adamkungl]

As many as 14 clubs run at a loss, surviving on hand-outs from their leagues clubs.

Wish this rubbish line would stop getting brought out. Leagues clubs exist to fund League teams ffs.

 

[Perth Red]

Wish this rubbish line would stop getting brought out. Leagues clubs exist to fund League teams ffs.

True, how many teams could survive on direct footy related income only?

 

[carlosthedwarf]

Just because they want 53% doesn't mean they will get it. Standard negotiating tactics, start high. They'd probably accept 45%+

 

[meltiger]

Wow, never saw this coming. This has been the agenda of the clubs all along. Goodbye international football. Goodbye grassroots football. The clubs are lining up to take the bread from the mouths of those in the game who are already neglected. The rich stealing from the poor. And yes this will ensure the clubs don't look at sustainable income streams of their own. They're jumping off the teet of pokies and onto the TV dollars, and they were already pretty hooked on the NRL's money to begin with.

Without the NRL clubs there ...... The TV contract doesnt exist. Deal with it.

Better management, at all levels, will ensure that cash is spent more beneficially than it is now.

& yes, the lazy clubs will sit back and not try to achieve, the clubs that want to be successful won't solely rely on their annual grants.

Quite frankly, the player payments SHOULD be entirely paid for out of the broadcasting contract, THEY are the ones bringing in the cash. No one else

 

[meltiger]

Wish this rubbish line would stop getting brought out. Leagues clubs exist to fund League teams ffs.

They exist to benefit their members. Not the football clubs that once founded them.

 

[juro]

Well that costs money in itself.

Not much point doing it if it is costing you money. The idea of marketing is to bring in more money than you spend on it! I accept that there may be short term losses, investing in the clubs for future gains, but most clubs don't have too many cash flow issues that I'm aware of...

 

[seanoff]

The AFL players get pretty much 100% of the TV money

Everything else is funded from other revenue

 

[Goddo]

:roll:

Wow, never saw this coming. This has been the agenda of the clubs all along. Goodbye international football. Goodbye grassroots football. The clubs are lining up to take the bread from the mouths of those in the game who are already neglected. The rich stealing from the poor. And yes this will ensure the clubs don't look at sustainable income streams of their own. They're jumping off the teet of pokies and onto the TV dollars, and they were already pretty hooked on the NRL's money to begin with.

ECT providing us with a fair and balanced opinion as usual

 

[Didgi]

Don't forget rational.

 

[Baron Vo Mandor]

Wow, never saw this coming. This has been the agenda of the clubs all along. Goodbye international football. Goodbye grassroots football. The clubs are lining up to take the bread from the mouths of those in the game who are already neglected. The rich stealing from the poor. And yes this will ensure the clubs don't look at sustainable income streams of their own. They're jumping off the teet of pokies and onto the TV dollars, and they were already pretty hooked on the NRL's money to begin with.

If the NRL cant cover this with 500 million + revenue from SOO, Tests, finals, merchandise and whatever revenue streams they have to fund grass roots and they international game they are very lol.

Key thing the IC should be aiming for is to get all existing clubs financially viable, and by covering all player payments for all three grades this should be achievable and ween us off leagues club grants. If clubs cant pay for facilities, coaching staff and admin then I'd be very suprised. Even the Sharks could manage that.

People talking about expansion have NFI, lets get all clubs making a profit each year, competitive and an exciting comp unlike recent years when there's been the top 4 teams that can win it and thats about it.

I seriously get sick of basically every year only the Storm, Manly, Bronco's and Dragons being a shot of winning it. Along with a token team like the Warriors, Cows or Dogs.

Expansion should not be on the agenda until this happens and that wont be until atleast 2015-2016, rushing in teams and diluting the comp even further would be the stupidest action and most brand damaging ever.

 

[Goddo]

Key thing the IC should be aiming for is to get all existing clubs financially viable, and by covering all player payments for all three grades this should be achievable and ween us off leagues club grants. If clubs cant pay for facilities, coaching staff and admin then I'd be very suprised. Even the Sharks could manage that.

Agreed. By covering the playing groups salaries, it frees up Leagues club money for investing in other areas, such as coaching, stadium, promotion, game day entertainment, facilities...

Expansion should not be on the agenda until this happens and that wont be until atleast 2015-2016, rushing in teams and diluting the comp even further would be the stupidest action and most brand damaging ever.

Which is what the NRL is going to do. And they will look to locations that improve the game as a whole and fit in with the current distribution of clubs.