TV networks "bidding for the highly coveted National Rugby League rights are pushing for the new Australian Rugby League Commission to accept advertising as a bigger part of the package," according to Darren Davidson of THE AUSTRALIAN. This proposal would mean the "cash value of the deal is unlikely" to be worth more than $1B. The ARL is understood to be "keen for the free-to-air broadcaster to air four games," with a Friday game, Saturday twilight game, and two games on a Sunday including a twilight game. It is understood Nine and Foxtel's joint offer was a combination of cash and "contra," which amounts to advertising slots and promotional value in place of cash. The NRL "may have to settle for free advertising slots in a bid to boost the value of its media rights above the magic billion-dollar mark coveted by the clubs." Contra advertising has "become a key part of the packages offered by free-to-air and subscription broadcasters." Both the AFL and V8 Supercars have accepted swags of airtime to promote events. It is understood negotiators for the ARL, the NRL's governing body, "are in favour of the NRL accepting advertising as a bigger part of the package" (THE AUSTRALIAN, 8/21). In Melbourne, James Chessell noted it is believed the incumbent broadcasters Foxtel and Nine "lodged a bid" of close to $1.1B for the '13-18 Australian TV and digital rights. The six-year offer represents an increase to the current deal with Nine and Fox Sports, which is worth about $100M per year, "but falls short of the ARL's preference of striking a deal worth at least $1B over five years." Nevertheless, once the contribution for the New Zealand rights -- currently held by Sky -- are included, the code and its adviser Greenhill Calibrun are likely to achieve the bottom end of their goal. Sources close to the ARL would not discuss Seven's presentation, but there is also the possibility Exec Chair Kerry Stokes "could attempt to trump its rivals by tabling an aggressive bid that pushed up the price (AUSTRALIAN FINANCIAL REVIEW, 8/20).
INVITEES: In Sydney, Brad Walter noted a new $1B TV rights deal "may be finalised before the end of the month." The heavy hitters who turned up to present the bids for their respective networks included Lachlan Murdoch and James Warburton (Ten), Kerry Stokes (Seven), David Gyngell and Jeff Browne (Nine), Ian Frykberg (Fox Sports), Patrick Delany (Foxtel) and Kim Williams (News Ltd). It is understood "talks continued over the weekend" and the ARLC negotiating team of Chair John Grant and fellow Commissioners Ian Elliot, Gary Pemberton and Peter Gregg were at the game's League Central headquarters again Monday (SYDNEY MORNING HERALD, 8/21).
IS IT ENOUGH?: Also in Sydney, Julian Lee noted that with NRL negotiations underway, analysts and the media industry are "questioning whether sport can deliver the numbers for pay-TV." Despite outlaying about $625M for the Australian Football League rights until '16, Foxtel's subscriber numbers are "lower than the market expected." Now as it backs a reported $1.1B bid for the '13-18 rugby league broadcast rights, some in the industry are "asking whether that last remaining weapon in Foxtel's armoury -- sport -- can lift subscriber numbers." Although the Olympics was a "critical success for Foxtel," it came at a cost, with $20M understood to be the amount it lost on the Games. A media analyst said the figures and 13% churn rate among subscribers "debunked the myth" the AFL was driving growth. The analyst added, "And now they are going to blow their brains out by doubling their bid for league. The only thing it's going to do is drive up its costs" (SYDNEY MORNING HERALD, 8/21).
