Seven West Media Secures V8 Supercars Rights For Lower Price Than Previous Deal
Seven West Media has secured free-to-air broadcast rights for V8 Supercars at a lower price than the last deal, "representing a possible watershed moment in Australian sports rights," according to Davidson & White of THE AUSTRALIAN. The two-year deal represented a "major haircut" for the sport. Seven agreed to pay about A$18M ($19M) a year in upfront annual fees. The V8 digital rights "will be auctioned in the coming weeks, and Seven is said to be keen to win those as well." TV execs said that second-tier sports had "entered a deflationary environment, as advertising revenue had become persistently weak." Under the new deal, an ad revenue sharing mechanism "will be activated after Seven recoups its incremental production costs." The deal is the first in more than two decades where the rights have been sold for less than the value of the previous contract. The deal "could be a pointer to lower returns for other sporting codes." Tennis and cricket rights are "still up for grabs" and concerns that declining ratings for the second season of the Big Bash League will "limit the amount Cricket Australia can ask for the free-to-air and pay-TV rights" (THE AUSTRALIAN, 1/16).
BETTER THAN EXPECTED: In Sydney, Colin Kruger reported V8 Supercars were "expected to struggle to get any bidding tension." Nine Entertainment and the Ten Network have instead focused on "the more important cricket broadcast rights, which are also up for grabs." The agreement covers V8 Supercars championship season and the Bathurst 1000. V8 Supercars CEO David Malone said, "This is an excellent outcome for the sport and fans" (SYDNEY MORNING HERALD, 1/15).