NRL to ditch digital arm

NRL scales back digital arm following broadcaster pressure​

By Zoe Samios​

October 6, 2021 — 3.53pm

The National Rugby League has bowed to pressure from its media partners and decided to scale down its digital content arm in a move that is expected to result in several redundancies at the organisation.

The shift, led by the NRL’s recently appointed chief customer and digital officer Alexi Baker, is part of an ongoing effort to streamline operations at the NRL to save costs and better serve fans. But it will also be considered a win for the company’s two media partners - Nine Entertainment Co and News Corp Foxtel - which have long expressed frustration about the division and argue the NRL’s own website competes with their digital properties.

Staff at the NRL were informed about the change on Wednesday afternoon and about 10 redundancies are expected to take place over the next few weeks. Staff who appeared at the meeting, who spoke on the condition of anonymity, said they were not given the opportunity to ask questions.

Under the plans the NRL will move away from creating news-focused content and work more closely with Nine (which is the owner of this masthead) and News Corp-controlled Foxtel on joint projects. The NRL website will mainly feature highlights and short-form videos that entertain fans instead of breaking news. The NRL was approached for comment but did not respond by deadline.

The NRL Digital Network officially launched in 2018 after the organisation took control of its digital assets from Telstra, an arrangement formed under the terms of its $1 billion broadcasting rights deal with Nine and Foxtel. The deal was a significant change in strategy for the NRL and involved the clubs investing money in digital rather than outsourcing it to media partners.

The network is currently made up of five parts including NRL.com, and sites and apps for the competition’s 16 teams. As of last year, the digital unit employed about 80 staff, including a product and technology arm with designers, developers and engineers who ensure the digital products work for fans. It has a media services division which handles game archives and images taken at matches, digital marketing and social media, a data and insights team, and employs about eight journalists who cover matches and interview players and coaches.

This is the first major change for NRL digital division since the arrival of Ms Baker (who previously led negotiations at Nine), who has undertaken a review of the organisation’s media arm. In late August, the NRL notified high-profile ex players and coaches such as Jamie Soward, Brett Kimmorley, Anthony Seibold and Robbie Farah that the website would no longer feature panel shows.

The restructure comes as the NRL prepares to propose the Redcliffe Dolphins as the expansion team for 2023 after agreeing to a deal with News Corp to inject at least $75 million into the sport over five years. Sources with knowledge of discussions told the Herald earlier this week that the NRL is providing the News Corp-owned Brisbane Broncos will an increase in exclusive matches, which will ultimately reduce the number of free-to-air games.

The NRL is presenting to the 16 clubs on Thursday and will provide them with details on how they plan to finance a 17th team. Any savings generated by the NRL could help with the justification of a new team.

NRL scales back digital arm following broadcaster pressure (smh.com.au)

 

[baselinepanther]

hang on

we will probably get over 400 million per year in media rights revenue as it is without the digital arm

grant is saying we might be able to get 360 million annually if we produced the games ourselves & had a light weight fta partner ...
but at what cost ?
it costs a lot to broadcast a sport
100 mill a year ?

so we'd be dudding ourselves out of 750 million over 5 years
Vlandys hs done the math
end of

 

[baselinepanther]

From what we know, which isn’t the full picture

1. revenue
2014 $5mill
2015 $4.9mill
2016 $5.8mill
2017 $6.6mill
2018 $23.6mill
2019 $24.5mill

Sadly in 2020 vlandys abandoned revenue transparency and buried digital revenue along with media revenue in a combined line item with other areas.

Expenditure
harder this one as it has never sat as a separate line item and is contained within the event, game and expenditure item.

2018 saw an increase on digital spend of $7.2million (leading to an increase in revenue for the Year Of $17mill)

i guess the valuations quoted are future forecasting where the digital arm could head to next. The revenue increase has been very impressive in ashort period of time and hard to know what the ceiling is for it.

2. yes afl does. Called afl media it employs around 100 full time staff inc 22 journalists. They don’t report their digital revenue separately and couldn’t find any reference to what it earns.

3. unlikely in the near future but in ten plus years time quite possible. Advertising would cover cost of production comfortably then it would need either it’s own subscriber base that could increase overall revenue, or it would be able to splice and dice the content and sell to different streaming companies. the advantage of owning content is the market becomes much bigger in terms of selling to different major global streaming services.

good questions. Is there the subscriber base, is there the market interest for streaming already produced content, how do you maximise digital revenue from a customer base heading towards 2 million people?

you're darn right it isn't the full picture

what did it cost to get that revenue ?
probably more then the revenue , hence the closing down of the arm

 

[baselinepanther]

who cares what the afl are doing with their digital arm

we know they're quite happy to piss money away with a delusional dream of one day making it work

the GWS midgets
& the Thuns come to mind

 

[Chief_Chujo]

you're darn right it isn't the full picture

what did it cost to get that revenue ?
probably more then the revenue , hence the closing down of the arm

It was profitable, by 2018 at the latest. Coincidentally the same time certain media started going after it.

Following a $3.7m net loss in 2017, the game’s governing body has attributed the growth to digital revenue, which increased $17m from $6.6m to $23.6m, along with sponsorship and wagering, up from $73m in 2017 to $78.9m last year.

NRL Declares $46 Million Profit While In-House Digital Proves Successful - Ministry of Sport

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ministryofsport.com.au

 

[baselinepanther]

It was profitable, by 2018 at the latest. Coincidentally the same time certain media started going after it.

proves successful lol , hardly a glowing appraisal. They say the code made a 43 million profit for 2018 but only say the digital arm was .... successful..... because it increased its revenue by 17 million. It doesn't break down the cost at all.

No one willingly gives away a profit making business just because they're told to like some ney sayers in here seem to think. As Grant said at best we could only earn 240 million a year in sales to subscribers if we produced our own content. But , that the cost to produce the content would put that figure a lot less.
The dream of independence & autonomy from media companies is a nice one , but just a dream unfortunately.
'

 

[baselinepanther]

I mean if it were a thing far bigger sports organisations then us would be doing it

they're not.

 

[Perth Red]

I mean if it were a thing far bigger sports organisations then us would be doing it

they're not.

You seem to be confusing two different things. One is producing your own game day content so that you can sell it to whoever you choose in what ever way you choose. At the moment no one is doing that but it is a massive risk to organizations like news ltd that one day sports will. It is what is keeping the market price for sports rights high.

Second is sports owning its own digital platforms, generating news and video content that drives supporters via social media to the site/s. Sport orgs then sell advertising space on these articles and sites for potentially significant sums. All sports are doing this to a greater or lessor degree. This is what the NRL is pulling back from. The media companies understandably want fans going to their sites so they can sell the advertising. In AFL case Telstra is paying AFL for this revenue stream. Have Nine and Fox paid NRL to reduce this revenue stream? We can see over the last few years how significantly the revenue is growing. We dont know what costs are so dont know profit margin but not hard to see it could be quite substantial, Grant knew this.

 

[Chief_Chujo]

proves successful lol , hardly a glowing appraisal. They say the code made a 43 million profit for 2018 but only say the digital arm was .... successful..... because it increased its revenue by 17 million. It doesn't break down the cost at all.

No one willingly gives away a profit making business just because they're told to like some ney sayers in here seem to think. As Grant said at best we could only earn 240 million a year in sales to subscribers if we produced our own content. But , that the cost to produce the content would put that figure a lot less.
The dream of independence & autonomy from media companies is a nice one , but just a dream unfortunately.
'

The NRL posted big increases in digital income for 2018, from $6.6m in 2017 to $23.6m, and Crawford claimed the league’s new in-house digital business managed to record a small profit in its first year of operation.

NoCookies | The Australian

www.theaustralian.com.au

It will have only gone up since then.

 

[baselinepanther]

It will have only gone up since then.

will it ?

you sure ?

 

[baselinepanther]

You seem to be confusing two different things. One is producing your own game day content so that you can sell it to whoever you choose in what ever way you choose. At the moment no one is doing that but it is a massive risk to organizations like news ltd that one day sports will. It is what is keeping the market price for sports rights high.

Second is sports owning its own digital platforms, generating news and video content that drives supporters via social media to the site/s. Sport orgs then sell advertising space on these articles and sites for potentially significant sums. All sports are doing this to a greater or lessor degree. This is what the NRL is pulling back from. The media companies understandably want fans going to their sites so they can sell the advertising. In AFL case Telstra is paying AFL for this revenue stream. Have Nine and Fox paid NRL to reduce this revenue stream? We can see over the last few years how significantly the revenue is growing. We dont know what costs are so dont know profit margin but not hard to see it could be quite substantial, Grant knew this.

grant said the production of game day content was where the real money is , but failed to mention the cost associated makes it prohibitive

the rest sounds like small fry stuff
again , no business is going to sell something that makes money ... just cos ,
for shits & gigs
yeah sure , its making a motza but we will close it down because you asked nicely lol

its a dud, or the nrl will be compensated in some form
anything else doesn't make sense.

 

[Iamback]

of Course NRL.com will still exist. Still sell ads just won't have so many journos on the books

 

[Perth Red]

grant said the production of game day content was where the real money is , but failed to mention the cost associated makes it prohibitive

the rest sounds like small fry stuff
again , no business is going to sell something that makes money ... just cos ,
for shits & gigs
yeah sure , its making a motza but we will close it down because you asked nicely lol

its a dud, or the nrl will be compensated in some form
anything else doesn't make sense.

advertising pays for production costs, thats whats been said a number of times. Think it was mentioned $50million a year for all the games and shows etc.

 

[baselinepanther]

advertising pays for production costs, thats whats been said a number of times. Think it was mentioned $50million a year for all the games and shows etc.

that figure sounds extremely low

id believe thats the cost for ch 9's games ...
but for 192 club games , 9 finals .. 3 origins & some change
no way its only 50 million

 

[Perth Red]

)

that figure sounds extremely low

id believe thats the cost for ch 9's games ...
but for 192 club games , 9 finals .. 3 origins & some change
no way its only 50 million

$250k a game? how Many staff would you need to produce a game I wonder?

 

[ayatollah_murdoch]

)

$250k a game? how Many staff would you need to produce a game I wonder?

One less than the bunker.

 

[Iamback]

that figure sounds extremely low

id believe thats the cost for ch 9's games ...
but for 192 club games , 9 finals .. 3 origins & some change
no way its only 50 million

Andrew Voss was asked on Twitter the cost for a game. Ave of $100k a game the majority of the production staff can do multiple duties or sports. No way you get it that cheap as an independent organisation

 

[Perth Red]

Andrew Voss was asked on Twitter the cost for a game. Ave of $100k a game the majority of the production staff can do multiple duties or sports. No way you get it that cheap as an independent organisation

Often they engage a separate media production company to do a lot of it. So if it costs fox $100k a game then it should be very achievable for the NRL to do it for less than $250k a game?

 

[Perth Red]

Supercars has been producing and on selling its own coverage for 15 years and shows no sign of moving away from it. They are in fact now branching out to be the producer of other motorsport events in Australia.
Tennis has also started to move that way for major events and rumors are F1 will do so as well more and more.

Supercars Media to produce Motorsport Australia Championships | TV Tonight

Motorsport Australia Championships screens on Seven from March.

tvtonight.com.au

 

[titoelcolombiano]

grant said the production of game day content was where the real money is , but failed to mention the cost associated makes it prohibitive

the rest sounds like small fry stuff
again , no business is going to sell something that makes money ... just cos ,
for shits & gigs
yeah sure , its making a motza but we will close it down because you asked nicely lol

its a dud, or the nrl will be compensated in some form
anything else doesn't make sense.

The other thing is that in the future at any time, if they choose to, the NRL could kick this back into gear. You're right, this is not the end of the world and like other posters have said, we don't know, maybe the NRL, just like the AFL are being paid for this revenue stream.

 

[Perth Red]

The other thing is that in the future at any time, if they choose to, the NRL could kick this back into gear. You're right, this is not the end of the world and like other posters have said, we don't know, maybe the NRL, just like the AFL are being paid for this revenue stream.

smacks more of appeasing your paymasters and not having the foresight to understand what the platform can deliver in the future. But this is RL and that just about sums up our leadership tbf.

you wouldn't be laying off the news arm of the business if someone else was paying. Control of your own narrative is massive, especially given the quality of our media partners who now control both tv, print and social media outlets.