I think this article sums up all we need to know about what will happen when revenue from broadcast deals dry up as FTA TV and Foxtel no longer have the capital to provide us with so much cash.
Any plan to create a Sydney conference will end badly because it's inevitable that Sydney clubs will go broke and fold. If the weak ones don't relocate now to keep their brand alive then they'll end up folding and cashed up consortiums such as the Pirates, Firehawks, Dolphins and Jets will take their spot.
'He capitulated': Richardson savages former ARLC chair Grant over NRL finances
Andrew Webster
By Andrew Webster
March 27, 2020 — 12.01am
Don't do it, John.
The game cannot afford it.
This was the warning several members of the NRL executive told former ARL Commission chairman John Grant before a critical meeting with the 16 club bosses on December 3, 2015.
They pleaded with Grant to refuse a demand to increase the clubs' annual grant to 130 per cent of the salary cap.
Grant's decision temporarily won him support from the clubs, who did not move to sack him in 2015.
The financial cost to the game, however, would be heavy. That cost has been exposed in the current crisis.
"Instead, he capitulated," recalled Shane Richardson, who was the NRL's head of game development at the time having been charged by then chief executive Dave Smith to streamline the entire code. "Greed set in."
Richardson ended his 17-year association with the Rabbitohs on Thursday when he resigned to ease the burden of financial cost of the COVID-19 crisis on the club. He will remain as a consultant but the decision expedites his departure at the end of the 2021 season.
"It's an incredibly selfless gesture," Souths co-owner Russell Crowe said.
In a lengthy interview with the Herald, though, the ever-polarising "Richo" preferred to riff about the perilous state of the game and that time, in 2015, when he worked for the NRL mothership.
"I was sitting there with [NRL chief financial officer] Tony Crawford, the whole executive — we would look at the figures every day and say, 'This isn't sustainable'," Richardson said. "Todd [Greenberg] was the head of football at the time and, while he's not a real figures man, he's smart and fully understood the situation.
"The game couldn't afford the 130 per cent. We said this to John Grant. But there was pressure on him from a cartel of clubs wanting more money; from player agents; from people inside the game; all wanting more money.
"We knew things had to change to make the game viable — but the clubs didn't want to hear it. When the $13m was put up there in front of them, they grabbed it. It shouldn't have been a decision just about the clubs. It should have been for the whole game."
Indeed, there's been plenty of finger pointing since the NRL competition shuddered to an indefinite halt because of the coronavirus pandemic.
Understandably, with no money coming in and hundreds of football people being stood down, questions are being asked about where the cash reserves are for a code that has secured billions in broadcast revenue in recent years.
It's unfair to skewer Grant for the game's current financial predicament, which has been exposed by a crisis that no one could have predicted. However, many remember that moment when Grant agreed to the clubs' demands and kept his job in the process. In the end, the clubs pushed him out a year later anyway.
"John Grant was one of my heroes growing up," Richardson said. "He was a Queenslander, a smart businessman. I'm just not sure he understood how difficult the politics of rugby league were and how vested interests were always going to be difficult to control.
"I think he thought he could talk sense into them. When it got to the crunch, and he realised he couldn't, I honestly believe he panicked.
"I'm sure he never got any money out of what he did. But when you are faced with those sorts of decisions, you need to cop the crap from club land, from sections of the media — because we had a real plan."
Richardson reckoned he had a plan, albeit a controversial one. Within weeks of Souths winning the 2014 premiership, Smith convinced him to leave Souths, where he had been chief executive since 2003, to join head office and come up with a "whole of game" strategy.
Richardson's' pay packet was rumoured to be massive.
"People go on about my wage," Richardson said. "My wage wasn't over the top. We would've saved millions so my wage would've been inconsequential."
Over the next year, Richardson spoke to countless people across the game "from under-6s to the NRL". He travelled to the US to study minor league baseball, which was turning profits, and seeing how that could be adopted in the lower tiers of rugby league. He then came up with his recommendations.
"It was a comprehensive plan that broke down the game's finances from the bottom to the top, and talked about a whole-of-game approach about the changes that needed to be made to streamline the game, to make it more efficient, to make it worthwhile, to replace things that hadn't worked for a hundred years: things like boundaries on junior leagues, about the reliance on leagues clubs, all the way through to the NRL.
"There would be a restriction on what could be spent on the lower tier; cutting back ridiculous money on young players before their time, spending $40,000 in some cases. That money could be reinvested into the state leagues, the famous 'Platinum League', that would bring in teams from the country as well as Fiji and Samoa …
"We wanted to decentralise the NRL, which would simply concentrate on the elite competition. Their staff would be minimal now."
Richardson presented his paper to the commission and it was accepted. Then the clubs caught wind of what was being recommended.
"The clubs had vested interests," he said. "They wanted to keep 9000 juniors to themselves, still wanting to stockpile young players. There were texts to John Grant about what an arsehole I was, and they hadn't even read the paper.
"We've all sat here as administrators and allowed football budgets to go ridiculously high. If we had the cap at $8m instead of $10m, we'd have $10m per club more in the game [over the five-year period of the broadcast deal]. We should've built up a cash reserve … Instead we went $49m into deficit. Who makes a business decision where you haven't got enough money for the next year?"
When Smith finished up at the NRL in late 2015, Richardson lost his biggest supporter. When Grant gave the clubs what they wanted, he knew he, too, had to go.
"I said to John, 'This is ridiculous because there's no point in me staying if I can't implement what I want to do'," Richardson said. "Todd and I were the obvious people to go for the CEO's role. But I said, 'Todd, you are the man for the job because you can handle the politics. I can't'."
Richardson returned to Souths in 2016 at the behest of Crowe, but in recent times has butted heads with chairman Nick Pappas, who tried to push him out the door late last year.
He's uncertain what his future holds – "I'm sure there's a feedbag out there for me somewhere!" — but he's convinced ARLC chairman Peter V'landys is the right man to navigate the game through troubled times.
"Plastic balls have to become titanium ones," Richardson said. "Hopefully, the strong leader in V'landys can drive us through. I can see it in his eyes. They are beady little eyes, focussing in. I wouldn't want them focussing on me. He's single-minded in what he wants to do.
"Nobody could've seen what was coming with the coronavirus, but what it's done is made the errors of the past blatantly clear. If we make the same decisions now, we will die. But there's no doubt V'landys knows what to do."
Grant did not return calls or texts offering him the chance to comment.
https://www.smh.com.au/sport/nrl/he...-grant-over-nrl-finances-20200326-p54e50.html
