Who to blame for the quagmire that rugby league finds itself in right now? John Grant? David Smith? Todd Greenberg?
PAul Kent is not the only one to be making criticisms. Gus Gould was making the comments on his podcast two months ago suggesting that people who had the power have wasted millions in flawed strategys and now want to cling on to power.
It never happened and John Grant was shown the door. Maybe David Gallop wasn't so bad huh?
I use the word quagmire, but not a go at the game, fans, or the players. More the fact league is not reaching for the stars in terms popularity, well spent resources, and expansion via its administration.
Five years and a billion dollars later rugby league is broke, writes Paul Kent
FIVE years and a billion dollars later rugby league is broke.
Take a look at that figure again: $1,000,000,000. That is a thousand cheques for $1 million each, gone in the wind.
Almost without notice October 31 looms, marking the end of the famous broadcast deal five years ago where ARL Commissioner John Grant claimed, “For our game it is the greatest deal ever done.”
The first billion dollar deal was the stake in the ground for the new commission and rugby league’s new era.
“The cash is useful in providing funding to grow our game from the grassroots to the elite level,” Grant said.
By then David Gallop had gone because he was seen as “reactive rather than proactive” — a laughable claim in light of current administration — and the banker, Dave Smith, would soon be brought in to stimulate the game’s growth and wealth.
CEO Todd Greenberg with John Grant, Chairman of the ARL Commission. pic Mark Evans
Eyebrows turned up within the clubs early on when the Commission, with their big business brains, told them they were going to show them how to make money.
Then the League went on a reckless spend and squandered millions on high-priced consultants and bad ideas.
And if you check the receipts there is little to show.
Crowds have gone down, television ratings on Channel Nine are down, memberships have risen (but come from a low base and are well down on the 400,000 the NRL strived for as part of its 2012 strategic plan) and, most of all, most significantly of all, less people play rugby league than played five years ago.
Somehow, the game is in decline. Despite an agenda to build the game’s wealth the NRL has no assets to speak of except the long-term lease of League Central, a building on SCG Trust land.
This week 25 NRL staff got sacked, 10 weeks before Christmas, as chief executive Todd Greenberg tries to rein in costs.
The banks recently knocked back the NRL’s application for a $30 million bridging loan. The league dismissed the need for a loan as nothing more than the normal running of business, scoffing at us knuckleheads in rugby league who got worried they needed cash.
In their scoffing, though, they failed to acknowledge or disclose that the first step towards bankruptcy for any business is a cash flow problem.
Worse, why didn’t the banks consider the NRL a safe investment? The AFL got a similar loan, but then the AFL has assets.
So the cash shortage — $1 billion all spent — continues.
They have discussed various contingency plans to pay their way.
The NSW and Queensland Rugby Leagues have been told they will get no funding for their state competition, which takes in under-20s for the first time next season, until the third quarter next year.
Put simply, for the first half of next year the state bodies will fund the NRL’s commitment to them.
The more you look at it the clearer it is the NRL was given a golden window, five years and a billion dollars, and blew it.
The Australian Financial Review reported this week that Channel Ten’s equity value was worth between negative $529.2 million and negative $543.7 million.
In August, Channel 7 reported a $745 million loss with Seven chief executive Tim Worner warning sports rights had reached a “tipping point”.
“Given changes in the market, price rises are not sustainable,” he said.
So future broadcast deals might not be as rosy as the one just ending or the one about to begin.
As the Rugby League Players Association negotiates the next Collective Bargaining Agreement with an under pressure NRL — for all the reasons stated here — there is a genuine possibility this era of rugby league player will earn more than the next.
Especially if the salary cap is tied into total revenue.
It’s good deal for the senior players driving this deal. Not so much for the young players coming through.
At the same time the CBA is being negotiated the game has still not finalised its pathways program, its club funding agreement or, most importantly, implemented the promised constitutional change.
Australian Rugby League Commission Chairman John Grant and NRL CEO Todd Greenberg. Picture: Brett Costello
Come November 1 the NRL moves into the next funding stage of its broadcast deal, this time $1.9 billion over five years.
Count it, that’s $1,900,000,000. An extra $900 million. Where is there any confidence the game will spend it wisely?
Earlier this year the NRL took me through its figures.
There is no doubt Greenberg is driving a lot of cost-saving as the game goes forward and tries to salvage years of poor spending.
The NRL has 40 different pie charts that can tell you where the money has been spent and where the money is going.
Yet nowhere does it say if the money has been well spent.
Most concerning was that come the 2022 season, the last of the current TV deal, the NRL is already budgeting to lose about $20 million that season.
It was seen as a normal loss.
I asked why the NRL, given it knows about 80 per cent of its projected budget, which few business can reliably know, can still run at a loss in five years.
“Inflation,” I got told.
Okay, but why couldn’t they budget for that, I asked.
“You don’t understand,” they said, “the deal is locked in but costs go up every year.”
Now, I am a simple man who runs nothing more serious than a household budget, and not always well at that.
But I asked again why they could not factor inflation in so the game could run at a profit, instead of the loss already anticipated now.
There was a brief pause.
“Well that’s one way to do it,” they said.
All the game owns is the hope and goodwill of its public.
Hopefully it is enough.
http://www.dailytelegraph.com.au/sp...t/news-story/f0658ac2a0c17987c293455d09cae3af
