Financial fragility of the game

[Perth Red]

If the nrl can bring in greater control over club spending then Gus’s prediction won’t be necessary.

Phil Gould has predicted that two more Sydney NRL clubs will be forced to merge within the next decade.
Gould, the general manager of Penrith Panthers until last year, believes that having nine Sydney clubs won't be possible into the future.
"My news isn't so great. I think we'll see two Sydney clubs, two more mergers in Sydney," Gould said.
Most Sydney clubs have been hit hard by the closure of leagues clubs during the COVID-19 lockdown, putting even strong organisations like Parramatta, Penrith and Canterbury under strain. Manly owner Scott Penn, long rumoured to be seeking a buyer for the Sea Eagles, has been outspoken about the risk of NRL clubs going under.
South Sydney is in a sound position, with Russell Crowe and James Packer sharing a 75 per cent private ownership stake. So too are Sydney Roosters, backed by Easts Group but with Nick Politis as their wealthy and powerful chairman.
One of the clubs regularly touted as an extinction risk, Cronulla, is actually in a strong position because it had already factored in the closure of its leagues club this season amid a redevelopment. The Sharks have also enjoyed a sharp upturn in their finances in recent years.
Sydney clubs Western Suburbs Magpies and Balmain Tigers merged for the 2000 season, forming Wests Tigers. The St George Dragons and Illawarra Steelers merged for the 1999 season, making the grand final in their maiden year as St George Illawarra.
The North Sydney Bears merged with Manly for the 2000 season, forming the Northern Eagles, but the partnership lasted just three years. Manly resurrected the Sea Eagles for 2003, while the Bears - a 1908 foundation club - ceased to be an NRL team.

"I think we'll see a reduction of teams in Sydney over the next 10 years. It's unsustainable and clubs won't survive. They'll either die or have to merge, they'll be in that situation."




https://wwos.nine.com.au/nrl/brad-f...9a5f-439d-afed-8dbeec735c67?ocid=Social-NRLFS

 

[Diesel]

"I think we'll see a reduction of teams in Sydney over the next 10 years. It's unsustainable and clubs won't survive. They'll either die or have to merge, they'll be in that situation."


If I had a dollar for every tine I have heard this

 

[mongoose]

Gould is so agenda driven. I read it as "clubs that aren't penrith are in trouble cause they didn't have me"

 

[Perth Red]

Its hard to see it happening but if NRL is serious about putting aside $30-50mill a year for future fund then club grants would have to reduce. The new rumoured TV deal is set t wipe out the NRL's surpluses of the last two years so unless expenditure is significantly reduced there wont be any money at the bottom line to invest.

 

[GongPanther]

Gould is so agenda driven. I read it as "clubs that aren't penrith are in trouble cause they didn't have me"

Gould is, and always has, Easts in the forefront of his "agenda".

 

[Perth Red]

It’s Rothfield so take with a large pinch of salt!
Some of it is factually wrong or just batsht crazy suggestions lol.


The NRL’s financial position is no longer catastrophic.

A soon-to-be-signed seven-year, $2.3bn TV broadcast deal is the richest in Australia’s sporting history and gives the NRL a wonderful foundation to safeguard its future.

The game now needs a seven-year strategic plan, driven and delivered by Peter V’landys, and long-term investment must be the No 1 priority.
on-broadcast revenue and the game has a solid base.

The clubs get $206m (16 x $13m grants), which takes care of player payments and leaves each franchise $3m in change before sponsorship, membership, ticket sales, merchandise and leagues club grants. That leaves $324m for the NRL each year. And this is what needs to happen.
Cost-cutting will start at the top and the next CEO will be on lower than $1m.

Recently departed chief executive Todd Greenberg was on $1.2m plus big bonuses. It was recently revealed the NRL spends $500,000 a day to run the competition with a staff of 400.

V’landys has vowed to slash $50m a year from these costs. Executive wages have been out of control for too long. The game’s senior management team is on a combined $6m. The likes of second-in-charge Nick Weeks will no longer be on $900,000.
Poker machine revenue is slowly dying and Sydney teams can no longer rely on their licensed clubs.

Still, the NRL must not give the clubs more money. It’s like drip-feeding cash to a drunk punter.

These clubs have lost and squandered more than $400m over the past 10 years.

Money has been wasted on dozens of coach sackings, overstaffing of football departments, player contract payouts and salary cap scandals.

Football Departments
Salaries for coaches and their high-performance staff will be substantially reduced.

The days of Craig Bellamy and Wayne Bennett getting $1.5m are numbered. It is simply unaffordable. Some clubs are now spending up to $8m to prepare their teams. The NRL will impose a cap of around $4.5m on football departments. There will be two assistant coaches instead of three, one less physio and one less in sports science. The extravagance of having full-time dietitians, psychologists and two doctors will go.

Player Payments
Goodbye to Ben Hunt, Ash Taylor, Josh Dugan, Kieran Foran and Anthony Milford-type contracts.

The salary cap is now $9.6m and the RLPA will fight hard for increases each year. However, there is talk that players will have to take a hit like everyone else.

One official told me the cap could come down to as low as $8.5m next year while the game, like all businesses, slowly recovers from COVID-19. It would require an across-the-board pay cut of 11 per cent.

Grassroots
To save money, the responsibility for junior development needs to be taken from the clubs. In some cases, like at Penrith, it will save them several million dollars annually.

In the past the NRL, NSWRL and clubs have all employed development officers in schools and junior league. Representatives from all three bodies have been covering the same areas.

Clubs will be reluctant to lose control of their own juniors but it is the most cost-effective outcome.

Referees and bunker
The NRL employs 25 full-time referees and touch judges.

The Project Apollo committee has already determined the game will resume on May 28 with only one referee per game. The full-time squad could drop to as low as a dozen. There are many cost-saving opportunities for the bunker, including combining operations with other codes to share the same technology from the same facility. It could save $2m a year.

Integrity unit
The integrity unit employs 17 investigators, legal experts and betting analysts.

This is another area where cost savings could be significant. Like with the operation of the bunker, there is talk of setting up a statewide sporting integrity unit to be in charge of all sports in NSW.

The commission

Now is the time for a shake-up. To ensure transparency, the 16 clubs should have two representatives on the commission. There would be no more secrets over finances. Only COVID-19 uncovered the mess we’ve been in. Also the QRL and NSWRL should each have a representative at the table now they have taken full responsibility for grassroots.

Stadium policy
The NRL has to finalise a policy on venues and take it to the state government. Maybe even buy or invest in a stadium like Bankwest.

Greenberg always favoured the big stadium rebuilds at Allianz and ANZ, which is fine for Origin, grand finals and blockbusters. But V’landys is in favour of suburban-ground tribalism, as are the broadcasters, who loathe the backdrop of tens of thousands of empty seats. The nine Sydney clubs can only survive long term if several of the venues, such as Brookvale Oval, Shark Park, Leichhardt Oval, Campbelltown, Kogarah and Penrith, are upgraded into boutique or mini Bankwest Stadiums.

Investment
The NRL right now owns nothing.

V’landys wants to build a war chest. The aim is to bank or invest $70m a year. That would leave more than half a billion dollars in the bank by the time this next broadcast deal expires in 2027. And it would set the game up for the next 50 years.

https://www.theaustralian.com.au/sp...l/news-story/79766488a1c1359ffcda452eff0e354d

 

[seanoff]

CEO. - Pay peanuts. Get monkeys. Its a high profile, high pressure job. You’d be stupid to do it for Greenberg money and they want to offer less. Also a bit rich given the salary paid to news execs.

Commission. - how big will it be. That’s 32 commissioners just from the clubs. Some from the QRL and NSWRL then you do need some independents. It’ll be 50 people. They’ll have to hold the meetings in a theatre. +. The clubs will hold all the power. They’ll make decisions in their own interest not necessarily the best interest of the game.

stadiums. The govt aren’t going to build boutique stadiums to be used 3x a year. so the NRL are going to do it? They don’t own them. Are the govt going to sell them bankwest. Good luck buying that for less than $400m.

The afl paid $200m for marvel. They got that on a deal they signed to sell their stadium at Waverley. They also had a huge number of events there. 46 afl games, 8 20/20s, concerts, ufc, basketball last year etc. you need revenue to run a stadium. Revenue comes from events. They’d have to do significant ground rationalisation and therefore make the upgrades to the shitty little places redundant.

JUNIORS. So the clubs aren’t going to do it. Someone has to pay. Assuming that’s the NRL There goes the 50m in savings from running the comp.

Running the comp. yes there are salaries involved. But there is also a whole bunch of other costs that cannot be avoided. How much of that 500k a day is digital. How much is marketing and events. How much is insurance. How much for ground hire. Travel. Etc etc etc. there are false economies. A chunk of that money is used to generate revenue. If you spend less you get less revenue.

 

[mongoose]

I think we should build a massive 50ft statue of V'landys outside of NRL HQ with his ill fitting pants. News ltd would never speak a bad word about Rugba League again!

 

[shear_joy9]

I think we should build a massive 50ft statue of V'landys outside of NRL HQ with his ill fitting pants. News ltd would never speak a bad word about Rugba League again!

and it should have a sensor in front of it like in the city walk, that says rugba league every time someone walks past

 

[siv]

Grassroots
To save money, the responsibility for junior development needs to be taken from the clubs. In some cases, like at Penrith, it will save them several million dollars annually.

In the past the NRL, NSWRL and clubs have all employed development officers in schools and junior league. Representatives from all three bodies have been covering the same areas.

Clubs will be reluctant to lose control of their own juniors but it is the most cost-effective outcome.

Has he been reading Richos blueprint

I prefer that NRL development officers report into local district groups across NSW rather than NSWRL.

LC put $2 mil a year into local juniors as their community funding program.

Take away junior responsibility from the NSW district clubs and the question will be - who pays?

It won't be the NSWRL that's for sure

Take away district responsibility and you take away LC desire to build the junior strength, facilities etc etc etc

Parents in the city will be hit with the costs like they are in none LC regions/clubs which look like a 3rd world operation at times

Plain dumb to remove a RL grassroots revenue stream

And you start talking junior draft on the back of this

Only benefits Easts who have no juniors

 

[Heisenberg]

This has become ridiculous. The NRL should not take advice from dinosaur media outlets that seem to exist just to haemorrhage cash.

Saving money on referees and the bunker is absolutely insane.
Gutting the integrity unit will come back to haunt them and the same media will crucify when the inevitable scandal happens.

 

[T-Boon]

Has he been reading Richos blueprint

I prefer that NRL development officers report into local district groups across NSW rather than NSWRL.

LC put $2 mil a year into local juniors as their community funding program.

Take away junior responsibility from the NSW district clubs and the question will be - who pays?

It won't be the NSWRL that's for sure

Take away district responsibility and you take away LC desire to build the junior strength, facilities etc etc etc

Parents in the city will be hit with the costs like they are in none LC regions/clubs which look like a 3rd world operation at times

Plain dumb to remove a RL grassroots revenue stream

And you start talking junior draft on the back of this

Only benefits Easts who have no juniors

The NRL should charge the Leagues clubs $2m a year licence fee for the NRL team. And that gets directed evenly to juniors.

 

[T-Boon]

The NRL should buy North Sydney Oval.

 

[Silent Knight]

Gutting the integrity unit will come back to haunt them and the same media will crucify when the inevitable scandal happens.

That's what the gutter media want. Player misbehavior to keep the clicks coming.

 

[Perth Red]

The NRL should charge the Leagues clubs $2m a year licence fee for the NRL team. And that gets directed evenly to juniors.

in WA the two afl clubs pay an annual fee to the wafl for the license use. It gives the wafl around $10mill a year to spend on grass roots.
Would be nice to think NRL clubs could one day be profitable enough to do similar. Imagine how much stronger RL would be in Vic if storm were paying $5mill a year to nrlvic or nswrl was getting $50mill a year from its clubs!

 

[lockyno1]

This has become ridiculous. The NRL should not take advice from dinosaur media outlets that seem to exist just to haemorrhage cash.

Saving money on referees and the bunker is absolutely insane.
Gutting the integrity unit will come back to haunt them and the same media will crucify when the inevitable scandal happens.

The bunker has been a giant waste of money! It’s not getting anymore right than they used to!

 

[Quicksilver]

Imagine how strong the game would be if NRL players paid $1mil a season for the right to play the game!!

 

[siv]

The NRL should charge the Leagues clubs $2m a year licence fee for the NRL team. And that gets directed evenly to juniors.

Places like The Entrance LC might not pay as $2 mil beyond their current spend

Plus they would not be interested in paying for juniors over in Wyong

 

[T-Boon]

Places like The Entrance LC might not pay as $2 mil beyond their current spend

Plus they would not be interested in paying for juniors over in Wyong

I mean the leagues clubs that own an NRL licence.

 

[siv]

I mean the leagues clubs that own an NRL licence.

But there are lots and lots if other leagues clubs

Take Parramatta & Penrith areas both have LCs at NRL level LCs but also LCs as big or bigger at junior level than NRL level eg Mounties or Blacktown Workers

They all support Junior RL today