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SBD Global/June 3, 2013/Media

Channel Nine Board Grants Go Ahead To Retain Cricket TV Rights For Next Five Years

Australia's Channel Nine, Network Ten are in a cricket bidding rights war.
Channel Nine's board "has granted its senior managers clearance to go ahead and clinch the rich cricket broadcasting rights for the next five years," according to Chris Barrett of the BRISBANE TIMES. Nine is "tipped to wait until the deadline of Monday to make a final decision on whether to trump the offer by rival Network Ten," estimated to total about A$500M ($479M), and "retain the coverage of the game it has held for more than 30 years." Nine's American hedge-fund owners, Oaktree Capital and Apollo Management, "expressed their reluctance." However, the board "issued instructions this week to Nine management," led by CEO David Gyngell and Managing Dir Jeff Browne, that the "decision on whether to match Ten's offer was now in their hands." Nine "has a last-rights clause in its existing seven-year deal with Cricket Australia that allows it the final play over other suitors" (BRISBANE TIMES, 6/1).

UNDER THE GUN: In Melbourne, Malcolm Conn reported Nine "was already under increased financial pressure after last year's successful billion-dollar, five-year deal" for the National Rugby League rights, which is believed to be losing about A$30M a year. The cricket deal "will be another significant loss leader for the network." However, both sports "are considered important drivers for a share float of the debt-laden network within the next 18 months." It is uncertain if all of Nine's commentators "would remain and if the network would use three to call the action or return to two" (HERALD SUN, 5/31). In Sydney, John Lehmann reported the chances of Channel Nine retaining the rights to broadcast Australian cricket "are increasing, with WIN television billionaire Bruce Gordon prepared to do a critical deal to sell two television stations." Gyngell "wants to purchase WIN's stations in Adelaide and Perth to spread" the A$500M cost of retaining the exclusive cricket rights over a bigger network. A deal with Gordon "would be based on Nine purchasing the Adelaide station immediately and Perth later, when media laws are expected to be altered" to allow networks to reach more than 75% of the population (DAILY TELEGRAPH, 5/31).

A BIG VICTORY: Also in Sydney, Lehmann reported in a separate piece the deal means Channel Nine will be able to match Network Ten's A$500M bid "to broadcast Test and one-day cricket, including the Ashes this summer." The deal "is also a victory for Ten's newly installed chief Hamish McLennan, with the third-placed network to win rights to broadcast the Big Bash Twenty20 tournament for the next five years" for about A$20M a year (DAILY TELEGRAPH, 6/3).
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