Something interesting about the undersold NRL TV rights deal.

[fourplay]

http://www.smh.com.au/news/League/NRL-wants-TV-rights-deal-to-start-now/2005/05/19/1116361677981.html

NRL wants TV rights deal to start now
Channel Nine's proposed $40 million-a-year deal to keep the free-to-air TV rights would be expected to start immediately as a condition of the NRL accepting the offer.
NRL club chief executives yesterday welcomed the news that Channel Nine had begun the formal negotiating process for the rights, which do not need to be renewed before 2007, but most were of the opinion that the current $13 million-a-year deal should only be extended now if the increased money became available as early as this season.

Looking back, it appears that the NRL/News Ltd. purposely rushed to sell the television rights to make sure they negotiated their contract BEFORE the AFL's. If the AFL sold their TV rights for $150m a year and then the NRL negotiations began there would be no way the NRL would get away with underselling the TV rights for around $70m a year without a massive uproar. Too many questions would have been asked regarding the underselling of the television rights.

I predict this will happen again, the NRL will sign a nice little deal that will look good at the time, then the AFL will announce its billion dollar deal, and it's not until then will people realise the truer value of the NRL rights and the fact that we have been ripped off again. This will once again be countered by Gallop putting down the NRL and talking up the greatness of the AFL. For example:

"We also have to face up to the fact they are a national sport, while all our clubs are on the eastern seaboard or Auckland," Gallop said. "They are also bigger, with their biggest club crowd being 52,000 and ours 30,000. The Swans are bigger in Sydney than the Storm in Melbourne." - David Gallop on why the AFL TV rights deal was so much bigger

Funny he argued crowd figures which have nothing to do with TV ratings also.

 

[Stagger eel]

this is where i think John O'Neill would be ideal in Gallops position.

 

[Dogs Of War]

We all know Gallop has no balls and is just a News Ltd lackey.

 

[Brutus]

That is staggering. I can't stand John O'Neil, but I would much rather him in charge of our game than a News LTD lackey.

RL will never get to where it should be in Aus with the current set up.

Gallop's AFL comments above are staggering and not what you want to hear from your leader especially when we all know how well RL rates on the box.

 

[LeagueLegend]

That is staggering. I can't stand John O'Neil, but I would much rather him in charge of our game than a News LTD lackey.

John O'Neil is a good administrator. He was good for rugby in his first stint, great for soccer though they negotiated a crap TV deal too and he is only just a shave above fair back at rugby.

 

[Karmawave]

What is more of a concern, is the way the NRL undersold their multimedia and internet rights to TELSTRA.

To think a professional organisation can be so incompetent and not see the benefits of multimedia profit opportunities is just ridiculous.

They might as well just given them away to Telstra.

 

[LeagueXIII]

Mate they aren't incompetent, the sad thing is they know exactly what they are doing, this would all be tied in with repayment of cost for the SL war. They are just using their media to keep everyone in the dark and Gallop as the puppet to push the message.

As was said League will always be 2nd fiddle until News f*** o**. I am desperately hoping it will be in after the next rights agreement. As it seems they are lining everything up for the 2011/12 period.

I also wonder if this time period has anything to do with AFL rushing for teams by these years? Because on a positive note league is only half way up it's "ladder" of potential in terms of money and growth (which is obvious as News does everything to hold it back) whilst AFL is virtually at the very tip, it has very little growth left.

On a

On a posi

 

[bulldog]

As was said League will always be 2nd fiddle until News f*** o**. I am desperately hoping it will be in after the next rights agreement. As it seems they are lining everything up for the 2011/12 period.

From what I remember reading a while ago News have no plans to exit the partnership and the contract between them is so full of holes and grey areas that RL may never be free of the parasite. News is the monkey on our back when they should be one of our biggest allies, we win - they win.

 

[BPS]

Yea the bloody superleague clubs should pay back the candy man. Them and their fans were the destruction of Rugby League in this country. The entire fiasco has set League back at least 10 years and so many millions of $$$$$$

While the ex superleague footballers are buying their third beachside house, the modern day footballer is squeezed financially because of their greed.

Players like Lockyer, Thurston, Cameron Smith oh and Carney should be earning more like 750,000 a year instead of being squeezed for the sins of their forefathers

 

[gottabegood]

Quote:
"We also have to face up to the fact they are a national sport, while all our clubs are on the eastern seaboard or Auckland," Gallop said. "They are also bigger, with their biggest club crowd being 52,000 and ours 30,000. The Swans are bigger in Sydney than the Storm in Melbourne." - David Gallop on why the AFL TV rights deal was so much bigger

The question is, how come no RL/sports journalist have attempted to tear this apart with facts and figures, with a direct reponse from Gallop to "face up to the fact".
I'm assuming we have no mates....anywhere.

 

[Front-Rower]

Yea the bloody superleague clubs should pay back the candy man. Them and their fans were the destruction of Rugby League in this country. The entire fiasco has set League back at least 10 years and so many millions of $$$$$$

While the ex superleague footballers are buying their third beachside house, the modern day footballer is squeezed financially because of their greed.

Players like Lockyer, Thurston, Cameron Smith oh and Carney should be earning more like 750,000 a year instead of being squeezed for the sins of their forefathers

Your kidding, right?

 

[BuffaloRules]

The NRL TV rights will be undersold again unless Channels 7 and/or 10 actually put in a bid next time around....

Is this likely??

 

[Danish]

The NRL TV rights will be undersold again unless Channels 7 and/or 10 actually put in a bid next time around....

Is this likely??

Of course it is.


7 and 10 will want to screw 9 out of every cent they have, just like Packer did to them with the AFL.

Whether or not the NRL will even accept a bid from them is another story altogether (they didnt last time)

 

[BuffaloRules]

What does the NRL owe Channel 9??

Loyalty for being ripped off for years?

Channel 10 is no hope for a bid in my opinion.... wont be able to schedule it around the AFL and reality shows...

 

[Ziggy the God]

Another thing people are forgetting is Multi-Channeling, which will probaby be up and running by the time of the next rights.

We already have AFL shoved down our throats all over FTA, not that anyone is watching. The same can't be said the other way (Storm).

I believe that MC will deliver the NRL across the country for the first time, giving us equal coverage to the AFL. Not that they will get paid anymore for it.

 

[caylo]

What is more of a concern, is the way the NRL undersold their multimedia and internet rights to TELSTRA.

To think a professional organisation can be so incompetent and not see the benefits of multimedia profit opportunities is just ridiculous.

They might as well just given them away to Telstra.

90 Million dollars, would you like me to just give you a small indication of how much money that is. Telstra as a whole company is the leading telecomunication company in Australia makes a profit of about 4.5 billion/year. That is 20% of an annual profit. The company is worth about 16 billion, and so they basiclly gave a nice chunk of the company to the NRL for naming rights and Multimedia right. Only telstra has the ability to take the NRL in the future, remembering that Next G/AUSTAR will now make NRL viewing more accessable to people in rural areas, and can only increase viewing power and increase TV rights in the future.

 

[Ziggy the God]

90 Million dollars, would you like me to just give you a small indication of how much money that is. Telstra as a whole company is the leading telecomunication company in Australia makes a profit of about 4.5 billion/year. That is 20% of an annual profit. The company is worth about 16 billion, and so they basiclly gave a nice chunk of the company to the NRL for naming rights and Multimedia right. Only telstra has the ability to take the NRL in the future, remembering that Next G/AUSTAR will now make NRL viewing more accessable to people in rural areas, and can only increase viewing power and increase TV rights in the future.

The $90m was for the rights over 6 years, equating to $15m per annum.

That is a pittance considering the exclusivity of the deal:

Telstra obtains exclusive new media rights. Telstra enters into a A$90 million, six year naming rights sponsorship agreement with the NRL. Part of the deal is the grant to Telstra of an exclusive copyright licence for specific broadcast rights of NRL game footage on the internet and mobile phones.
http://www.dilanchian.com.au/ip/new-media-and-fair-dealing-legal-knock-on.html

 

[Rockin Ronny]

The $90m was for the rights over 6 years, equating to $15m per annum.

That is a pittance considering the exclusivity of the deal:

Telstra obtains exclusive new media rights. Telstra enters into a A$90 million, six year naming rights sponsorship agreement with the NRL. Part of the deal is the grant to Telstra of an exclusive copyright licence for specific broadcast rights of NRL game footage on the internet and mobile phones.
http://www.dilanchian.com.au/ip/new-media-and-fair-dealing-legal-knock-on.html

Suddenly, everyone's questioning Gallop and saying News Limited should be out of league. Brilliant. This has been obvious for 10 years.

 

[Slackboy72]

It all depends on when the next round is. No single channel can afford to keep either AFL or NRL sport to itself. Nor can any channel afford to have significant stakes in both. If either 7 or 10 were to jump ship from AFL to NRL (and why wouldn't you as NRL has the bigger drawing power as Telstra has admitted) then they need to be able to time an exit with no overlap and no overlap in coverage obligation. The sad fact is that the last AFL deal was overpriced. At $138.5m per year ($156m less the $17.5m advertising clause) for 185 games the cost comes to $748,648 per game. Considering that the losses for both 7 and 10 were estimated at $35m a year on the deal then we can estimate that the value is more around $559,459 per game. In the case of NRL rights we should come to at least $121m. At that level with 223 games the breakeven is considerably lower at $542,600 per game. Considering how well SoO rates and that the viewing audience is at least 10% more we should be looking at a figure closer to $616,000+ possibly $625,000 per game. I would ask a minimum of $140m per annum and considering FoxTel already put in around $70m to the AFL deal through sub-licensing and production costs I feel this figure is hardly stretching their budget into red-ink territory.

 

[Quidgybo]

We all know Gallop has no balls and is just a News Ltd lackey.

I really can't understand why everyone thinks replacing Gallop is going to be some sort of panacea. Whether it is Gallop or anyone else, at the end of the day the CEO answers to the NRL Board. If the board don't want their CEO to talk about expansion, run an open bidding process for television rights or whatever else then any CEO who pursues policies to the contrary won't be in the job much longer. It's not a question of whether Gallop has the balls for the job, the reality of the position is whoever occupies it has to tow the line of their employer or be sacked. Replace Gallop without removing News Ltd's influence on the NRL Board and you still end up with a CEO doing News Ltd's bidding. The CEO only has as much balls as he is allowed to have by the board that employs them. The real person with the power and independence to challenge News Ltd's agenda isn't David Gallop, it's Colin Love. He's the head of the ARL, the organisation that owns the other 50% NRL and appoints half the members of the NRL Board. Through those ARL members on the NRL board Colin Love has the power to block any News Ltd proposal (including the acceptance of an undervalued television rights agreement) and he isn't answerable to News Ltd if they don't like what he says and does. So where is Colin Love through all this? Why don't we hear a peep from him when RL needs a champion? And why isn't everyone here calling for his head for not using his position and independence to push the causes that Gallop isn't being allowed to promote?

Leigh