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Australian eyeballs are returning to Super Rugby but it will not be enough to guarantee a fat cheque from broadcasters after Fox Sports shelled out A$1.2 billion for cricket, a leading broadcast consultant has warned.
GMS principal Colin Smith says the pay broadcaster will have less money to spend on rugby after smashing open the piggy bank to secure cricket’s headline content in Australia for the next six years.
“I think [Fox Sports] will want rugby but it’s not necessarily going to be a significant increase if there’ll be an increase at all,” Smith said. “A whole lot of money was taken out of the system with [the cricket] deal and with massive increases in the deals for AFL and NRL, while they’ve clearly over paid for football.
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“There is more downward threat for Rugby Australia than there is upward pressure. The question is how do [RA] reinvent the [Super Rugby] model to make sure it’s attractive, to bring back fans and eyeballs and therefore encourage broadcasters to pay.”
* Australia cricket TV rights sold for A$1.2b
* Super Rugby conference format ‘must go’
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Smith’s comments come despite solid signs the move back to 15 teams in Super Rugby has arrested the ratings decline across the competition. Fox Sports is reporting a four per cent ratings uplift after eight rounds and a three per cent rise for Australian home games.
The early rounds were most promising, before numbers softened when the NRL and AFL started in March. The Waratahs’ round two home game against the Stormers drew an average audience of 102,000, while the Rebels v Reds game in round three was the next highest rating game to date with 84,000. Last week’s Waratahs v Reds game drew 61,000.
Sanzaar boss Andy Marinos said the uplift was also reflected in South Africa and New Zealand.
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“What we’ve seen so far this year in terms of ratings is an adjustment and it’s certainly been a lot more positive than in 2017,” Marinos said.
“There’s been a renewed interest and the upside is that we’ve also seen a lot more competitive games from all teams.
“My initial engagement with the broadcasters has that it’s been stable and steady on their platforms so we’re no longer in a continual downturn. So we’re reasonably happy so far, but there’s still a long way to go in the season.”
The gains, while modest, may prove crucial for Rugby Australia. Its current deal with Fox Sports and Ten, worth A$285 million (NZ$303m) over five years, does not expire until the end of 2020. But due to the test and international components of the deal Australia and its Sanzaar partners will spend this year formulating a preferred model before taking it to market in about 12 months’ time.
To that end, RA boss Raelene Castle has brought on board consultant Michael Tange, who forged a career with sports marketing firm Repucom before it was acquired by Nielsen Sport. Tange was presented to RA members at its annual general meeting last week and will draft Australia’s response to the Sanzaar strategic review, which is understood to canvas a number of options for the next iteration of Super Rugby, including expansion, further contraction, and the status quo.
Smith says Tange has his work cut out given the broadcast climate at home and abroad. Much of the 148 per cent uplift in the current rugby rights deal was delivered by a fierce battle between UK broadcasters Sky and BT (Sky won). In a potentially ominous sign for southern hemisphere rugby, Sky and BT recently agreed a sharing arrangement for English Premier League rights and secured a 16 per cent cost reduction for their troubles.
“You would expect there will be reductions or a plateauing in the price of content across all markets,” Smith said. “It [the EPL deal] is the first indicator that the UK market has reached a tipping point. That will have ramifications for Super Rugby.”
The Super Rugby discussions will again raise the prospect of Australia going it alone or asking New Zealand to jettison South Africa at the provincial level and enter into a trans-Tasman competition. It is unlikely any of the unions would try to dismantle the Rugby Championship.
“What you can’t do with this is adapt the ostrich management style,” Smith said. “If Rugby Australia don’t do their homework on what Super Rugby competition is in the best interests of Australia and its broadcast partners, then they’re going to end up killing the sport.”
– Sydney Morning Herald