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News: No easy answer to the $1b question

Discussion in 'Rugby League Forum' started by Berkeley_Eagle, Nov 20, 2010.

  1. Berkeley_Eagle

    Berkeley_Eagle Current Status: 24/7 Manly Fan 2016 Tipping Competitor

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    Written by Roy Masters smh.com.au  
    Saturday, 20 November 2010 04:09


    A senior TV executive recently told NRL boss David Gallop of the AFL's expectation of its next broadcasting contract: ''No one at the AFL wants to accept the fact that they got hit on the arse by a rainbow with their last contract.''

    The comment was in reference to Channel Nine's then owner, Kerry Packer, making a deathbed offer of $780 million over five years for the rights, a sum that a Channel Seven-Ten consortium was forced to equal under its first-and-last rights deal with the AFL.

    The AFL is demanding $1 billion for its 2012-16 contract but negotiations have stalled while the football codes and TV networks await the announcement of changes to the Federal Government's anti-siphoning laws. The NRL is also seeking $1b, based on superior viewer numbers.

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    However, the comment made by the TV executive to Gallop could also be interpreted as a message the NRL should temper its own expectations, insofar as a leap from the existing payment of $90m a year to $200m is a significant jump.

    Yet advertising revenue figures obtained by the Herald from Sydney sources indicate both codes generate about the same amount of money from commercials shown during games, which means - assuming broadcasting costs are similar - both codes should receive approximately the same rights fees.

    Three Sydney experts calculate the AFL's eight games a week yield $100m from free-to-air TV, with pay TV adding a further $15m.

    They estimate NRL matches shown in Sydney and Brisbane write $70m of commercials on Nine and a further $15m in the regional networks but admit these figures could be higher because of uncertainty over advertising revenue written on Nine's second Friday night game.

    The second match (Nine typically beams a Queensland club game into Sydney and a NSW club game into Brisbane) is on delay, and therefore allows the network to slot multiple advertisements into its telecast. Nine's Sunday afternoon game is also on one-hour delay, allowing the network to load up with commercials.


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  2. Chip and Chase

    Chip and Chase True Supporter Staff Member Administrator Premium Member 2016 Tipping Competitor

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    I could never figure out how people thought this new TV rights deal would be the panacea that would save the game, the figures being bandied around by some just seemed unsustainable. I'm sure the cosy deal with the Murdoch / Packer / Foxtel / Channel 9 / NRL cartel saw the games TV rights undervalued, but the idea that the next deal would be pennies from heaven seemed fanciful.
     

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