A A$3B ($2.3B) bidding frenzy between three free-to-air TV networks and pay-TV provider Foxtel for sports rights "has been sparked" by rugby league's decision to enter the market "a year ahead of schedule in an effort to steal a march" on rival code Australian Football League, according to John Stensholt of the AUSTRALIAN FINANCIAL REVIEW. Cashed-up incumbent free-to-air broadcaster Nine Entertainment Co. "is prepared to pay a record amount for sports rights to keep its rugby league rights, but will face strong competition from Seven West Media and Network Ten." Nine's rivals "are particularly interested in the three-match State of Origin series, usually among the highest rating of any TV show each year." National Rugby League CEO Dave Smith indicated that "he wants the networks to bid for Origin as a separate asset." The NRL's move is expected to also "spark intense negotiations across the networks and Foxtel and Fox Sports Australia as all parties seek to cut joint venture deals to potentially spread the financial burden the new contracts will cause." A source said, "It is unlikely any free-to-air network can exclusively own both the AFL and NRL." Ten, which has struggled in the ratings and "needs a significant boost" to its balance sheet, "is prepared to cut deals with other networks in an attempt to gain a foothold in either sport" (AFR, 4/26). In Sydney, Adrian Proszenko wrote State of Origin could be worth almost A$500,000 ($391,000) per minute if the NRL "opts to sell off the marquee interstate series separately." The NRL "considered splitting its properties for the last deal," which netted about A$1.2B -- a figure that was similar to that of the AFL. However, "sources close to negotiations believe this is likely to happen during the current discussions, meaning Origin, the Auckland Nines, international matches and the World Club Series and even the home-and-away competition itself could be sold individually to a variety of networks." An insider said, "I assume there will be no rules. They wanted to do that last time, so I don't see why they wouldn't discuss that." Global Media & Sports Managing Dir Colin Smith, who worked for the NRL on the last TV deal and has also advised the AFL and Australian Rugby Union in previous negotiations, believes that "the next league agreement could be worth" up to A$2B ($1.5B). By his estimation, Origin could account for up to 25% of that revenue -- meaning each interstate game "could be worth" up to A$416,000 ($325,000) a minute (SMH, 4/26). Also in Sydney, Brad Walter wrote the NRL's rationale for commencing talks with the broadcasters "is to ensure rival networks are also able to bid as Channel Seven was never a serious contender when the last deal was done in 2012 after securing the AFL rights months earlier." With the AFL rights also due to expire in '17, whichever code gets a deal done first will have more networks bidding -- "a situation that NRL officials believe will ensure a higher price" (SMH, 4/24). In Sydney, Darren Davidson wrote Smith "conjured up an audacious move" to get one over AFL CEO Gillon McLachlan, "deftly exploiting the rival code’s delayed talks." A spokesperson for the NRL "declined to comment." Broadcasters "are paying more than ever for exclusive rights because the immediacy of fixtures and fan loyalty ensure big live audiences, which will push up the value of the NRL’s rights." Bidding for rights as they come up for renewal "has become an even fiercer game, which makes for an intriguing spectacle in coming months" (THE AUSTRALIAN, 4/25).
