The TV rights thread part II

[El Diablo]

http://www.theaustralian.com.au/bus...rl-pay-tv-rights/story-fn91v9q3-1226120370890

Consolidated Media worried over price of NRL pay-tv rights

James Chessell
From: The Australian
August 23, 2011 11:57AM

THE pay-television industry has given the strongest indication yet that it believes price expectations for the next NRL broadcast rights are overheated.

Consolidated Media executive chairman John Alexander used an analysts briefing today to talk down the value of the 2013-17 NRL rights, which will be up for grabs once the code's new commission if formed.

He also became the first media executive to refer to recent reports suggesting the next rights deal could fetch up to $1.4 billion -- an optimistic figure that would dwarf the $1.25bn television, digital and mobile deal the AFL struck with Foxtel, Telstra and Seven in April.

"Clearly there has been a lot of publicity about the NRL deal coming up and obviously Fox Sports already takes a large chunk of the NRL," Mr Alexander said.

"I don't think there is any appetite at Fox Sports to hand vast additional cheques for additional value. Unless Channel 9 has got much, much deeper pockets than we all believe, then I think the prices that have been talked about with NRL remain confusing."

ConsMedia owns 25 per cent of metropolitan pay-TV group Foxtel and 50 per cent of Premier Media Group, the producer of Fox Sports.

Its biggest shareholders are James Packer and Kerry Stokes's Seven Group.

News Limited, publisher of The Australian, has identical shareholding in Foxtel and PMG and is exiting its 50 per cent stake in the NRL as part of the formation of the new commission.

NRL boss David Gallop warned the pay-TV industry -- which currently broadcasts five out eight regular season matches -- not to take the sport for granted in the upcoming negotiations.

Nine and PMG pay about $100m per year for the current deal with most observers expecting a significant uplift in the price from both types of television next time round.

Mr Alexander's views about value echo comments by newly-installed PMG chief executive Patrick Delany .

Mr Delany said he would like to own the live rights to every game -- with some matches simulcast on free-to-air -- but added: "What you get dictates what you pay for."

Mr Delany would not comment on the $1.4bn figure, which emerged from a recent NRL conference.

With Foxtel already releasing its result earlier in reporting season, the performance of PMG was of particularly interest to analysts.

With the cost of major sports rights expected to rise and pay-TV penetration sluggish in the past two years, Mr Alexander was asked if about the growth outlook for the business.

"There is a new CEO in place with a very decisive view on how to spend money," he said.

"I would say in the relatively short time in the job -- and bearing in mind (Mr Delany) comes from many years at Foxtel -- he would have far more ambitious plans about how Fox Sports grows over the next several years."

 

[El Diablo]

so they plan to dud us again

 

[Goddo]

^ if so, tell em to get farked. Do production in house, and sell to Telstra for broadcast via T box. Watch the pricks bend over backwards to get it then.

 

[jimmee007]

its all smoke and mirrors.

They know they need to pay through the nose for NRL so they are trying to talk it down. If they dont get it they wont have to worry about slow growth in the pay TV market, they will be worrying about negative growth if they lose the rights.

 

[gUt]

Seriously if Fox plays hardball and loses the NRL rights, for every 1 additional subscriber they seduce with AFL, they will lose 10 from NRL fans instantly cancelling. They are playing with fire.

 

[docbrown]

so they plan to dud us again

It's just talk.

 

[forward pass]

It is surprising that two or even three FTA networks aren't bandying together to buy NRL rights outright.

That would just about kill Foxtel in NSW and QLD and everyone would be watching FTA again. Imagine the advertising dollars that would come back to them with Foxtel just about dead. It would compensate for the cost of the rights surely.

 

[Tiger Hawk]

What do people expect?

Fox Chief: "Nah you're all wrong, they're not worth $1.4bn, we're going to be giving them $7.5bn".

It's called a negotiation and we'll get what the market dictates we'll get. Love to see the code get as much as possible but of course the media chiefs are going to be talking it down.

 

[El Diablo]

What do people expect?

Fox Chief: "Nah you're all wrong, they're not worth $1.4bn, we're going to be giving them $7.5bn".

It's called a negotiation and we'll get what the market dictates we'll get. Love to see the code get as much as possible but of course the media chiefs are going to be talking it down.

they didn't for AFL

 

[Perth Red]

Out of interest what sort of numbers do you think have Fox primarily for NRL? With viewing an estimated 300K (not sure how that breaks down subscription wise) it would be fair to think there is at least 100-150k subscribers who pay for Fox primarily for the NRL and would cancel if they lost the coverage. That could equate to somewhere around $90-200million a year in lost subscriptions + advertising and a very big hole in their scheduling. Will they will be willing to take that gamble I wonder?

 

[Raiderdave]

What do people expect?

Fox Chief: "Nah you're all wrong, they're not worth $1.4bn, we're going to be giving them $7.5bn".

It's called a negotiation and we'll get what the market dictates we'll get. Love to see the code get as much as possible but of course the media chiefs are going to be talking it down.

you mean those same media chiefs you claimed it would be impossible for the AFL to get a billion , yet ended up paying 1.25 Billion ?

those media chiefs ?

ahhhhh.... hot air is all it will be if they start the same cr@p with us.
They've set the precedent & Market price by paying as much as they did for the AFL , a code that is failing on TV & has been for the last 5 years

the question is what will the market price
( the real one not the BS one ) .. be for a code that is not only not failing
but is setting records on a near weekly basis
I'd think we'll do all right ... we'll do just fine ;-)

 

[gallagher]

I'm sure they are talking to all networks.

Ya think? I'm saying that CH9 is the ONLY broadcaster who has said we need more ads during the game. Now seeing that they broadcast only one game a week that is live why should we even be thinking about changing the game?
Why bend over and let them f8ck us up the arse again when they show one game out of the 8 live and only into 2 states?

 

[nrlnrl]

I'm sure they are talking to all networks.

go SBS !

 

[Bgoodorgoodatit]

http://www.theaustralian.com.au/bus...s-says-consmedia/story-fn91v9q3-1226120787201


Let's get real on NRL rights, says ConsMedia

• James Chessell
• From: The Australian
• August 24, 2011 12:00AM

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Source: The Australian



CONSOLIDATED Media Holdings has raised questions about the value of some sports rights, warning that the pay-television industry will not overpay for the NRL rights amid market concerns about earnings growth at Fox Sports.

The value of televised sport was discussed during ConsMedia full-year results briefing yesterday, with the negotiations for the 2013-17 NRL broadcast rights likely to kick off once the code's new commission is formalised in November.
ConsMedia executive chairman John Alexander became the first media executive to refer to recent press reports suggesting the next rights deal could fetch up to $1.4 billion -- an optimistic figure that would dwarf the $1.25bn television, digital and mobile deal the AFL struck with Foxtel, Telstra and Seven in April.
"There are question marks about some of the sporting costs. Clearly there has been a lot of publicity about the NRL deal coming up and obviously Fox Sports already takes a large chunk of the NRL," Mr Alexander said.
Start of sidebar. Skip to end of sidebar.





End of sidebar. Return to start of sidebar.


"I don't think there is any appetite at Fox Sports to hand vast additional cheques for no extra value. Unless (incumbent broadcaster) Channel 9 has got much, much deeper pockets than we all believe, then I think the prices that have been talked about with NRL remain confusing."
ConsMedia owns 25 per cent of metropolitan pay-TV group Foxtel and 50 per cent of Premier Media Group, the producer of Fox Sports. Its biggest shareholders are James Packer (with 51 per cent) and Kerry Stokes's Seven Group (with 24 per cent).
News Limited, publisher of The Australian, has identical shareholdings in Foxtel and PMG, and is exiting its 50 per cent stake in the NRL as part of the formation of the new commission.
Nine Entertainment and PMG pay about $100 million a year for the current deal, with most observers expecting a significant uplift in the price from both types of television. Seven and Ten have expressed interest in the rights.
Newly installed PMG chief executive Patrick Delany has said he would like to buy the live rights to all games -- Fox Sports currently shows five out of eight matches -- in the next deal, but only if the "value equation" is right.
With Foxtel already releasing its result earlier in the reporting season, the performance of PMG was of particular interest to analysts. Earnings before interest, tax, amortisation, depreciation and amortisation was down 4.9 per cent to $145.9m for the 12 months to June 30 amid slow subscriber growth and higher costs associated with broadcast rights. This compares with Foxtel's EBITDA of $550.6m, which was up 15.5 per cent on 2009-10.
ConsMedia's operating profit for 2010-11 was $94.8m, which is up 6 per cent on the previous year. A one-off property gain gave the company a reported net profit of $101.7m.
Weak retail conditions and competition from free-to-air digital channels have crimped subscriber growth in the past two years. But pay-TV executives hope the new AFL rights -- which allow Fox Sports to show every game live next year -- will help boost customer numbers in the southern states.
Despite these challenges, Mr Alexander told analysts Fox Sport could generate earnings growth. "There is a new CEO in place with a very decisive view on how to spend money to acquire value," he said.
ConsMedia declared an unfranked final dividend of 6c per share paid on October 21.


sounds like the usual down valuing that we have come to expect.

lose the nrl and watch your subscriptions walk out the door. i know i will.

 

[Tiger Hawk]

you mean those same media chiefs you claimed it would be impossible for the AFL to get a billion , yet ended up paying 1.25 Billion ?

those media chiefs ?

So let me get this straight - I claim it's a negotiation and of course the media chiefs are going to be coming off a low figure and in response you bring up a recent example of them doing.......exactly that? Thanks wiz.

 

[bobmar28]

Ya think? I'm saying that CH9 is the ONLY broadcaster who has said we need more ads during the game. Now seeing that they broadcast only one game a week that is live why should we even be thinking about changing the game?
Why bend over and let them f8ck us up the arse again when they show one game out of the 8 live and only into 2 states?

I'm sure the IC will talk to all networks and ask them what they would be willing to pay for. And take the best offer.

 

[Rockin Ronny]

sounds like the usual down valuing that we have come to expect.

lose the nrl and watch your subscriptions walk out the door. i know i will.

Of course it is.
remember - this is earnings growth i.e. profit growth. Both groups are still very profitable.

We all need to realise that rugby league and its fans have been taken for a big ride by News Limited. Any outlay by News during teh war should have been regarded as "tough luck", they spent money to get an outcome. However, rugby league has been forced to pay back what News Limited allegedly spent BUT news limited made hundreds of millons from Foxtel and its other properties on the back of rugby league.

Media companies NEED rugby league. It has always been - and will always be - a prime TV asset. In the 90's, the losers who dealt with News Limited gave away the farm to Murdoch and Packer. Now - if Fox loses rugby league, it will destrot their PayTV business.

It's now time to go to the table and say "this is what we want because we know you guys will make X dollars from this deal and you have no choice". be tough - and be prepared to canvass all bidders and walk away if necessary.

 

[Cletus]

Can someone explain to me why we sell our rights to PMG and the AFL sell theirs directly to Foxtel? I understand how PMG came about because of Optus, I just don't undertand why we need to sell to them.

 

[BranVan3000]

Lol they can try play hardball all they want, the fact that NRL accounts for something like 65% of the most watched programs on Foxtel speaks for itself

Foxtel is already on the backfoot with digital distribution, basically the only asset they can leverage over that growing market is live sport

 

[Goddo]

sounds like the usual down valuing that we have come to expect.

lose the nrl and watch your subscriptions walk out the door. i know i will.

Exactly.

CMH over paid for AFL to maybe get new subscribers in Victoria? Thats their problem.

Rugby League generates 77/100 top rating programs on pay TV.

Pay up or f*ck off and die.

The NRL should look at other options, and completely ditch PayTV. Internet based, Telstra T-box, in-house production and on sale... We have options. They don't.

Pay or go belly up Foxtel.