NRL sells out again

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The Australian Financial Review 15/11/2005

The National Rugby League has agreed to a pay cut to keep Macquarie on side, writes Neil Shoebridge.

Macquairie Radio Network and the National Rugby League are wrapping up a radio broadcasting rights deal that will give the NRL less revenue and reduced coverage in regional NSW and Queensland but will ensure Macquarie remains its ally.
NRL executives would not comment on the negotiations for a three-year radio rights deal, which will take effect from the start of the 2006 competition.
But sources close to the talks claimed that the NRL had abandoned the idea of splitting the rights between incumbent Macquarie Radio Network, the owner of Sydney's 2GB and 2CH, and Broadcast Operations, which owns Sydney's 2SM and which now buys NRL coverage from Macquarie for its 33 regional stations.
Instead, the NRL is belived to have agreed to strike another exclusive contract with Macquarie, which is controlled by John Singelton and whose 2GB station is home to announcers such as Alan Jones and Ray Hadley.
Under the new contract, Macquarie will pay an estimated $500,000 in cash and $500,000 in free ads on 2GB, a year, down from $750,000 in cash and $750,000 in kind under its current contract.
Broadcast operations had bid $200,000 in cash and $200,000 in kind for the Sydney and Brisbane rights to one Sunday match and the regional rights to all NRL matches.
A spokesman for Broadcast Operations said its owner, Bill Caralis, would refuse to deal with Macquarie, which would make it difficult for the NRL to secure regional radio coverage.
Broadcast Operations now plans to produce a five-hour sports program on Saturdays and Sundays for its regional stations.
Until last week the NRL was planning to sell the Sydney and Brisbane rights to Saturday afternoon matches, one Sunday match, State of Origin games and the final series to Macquarie, enabling the radio company to cut its NRL rights costs from 1.5 million a year to $800,000.
But Macquarie executives were believed to be unhappy about Broadcast Operations taking control of regional coverage and broadcasting a game in Sydney via 2SM.
"2GB is a very influential station in Sydney," said one source.
"Obviously the NRL didn't want to put it offside."
Macquarie chief executive Angela Clarke was not available for comment.
Macquarie will now pay an estimated $1 million for the NRL rights, compared with the estimated $1.2 million the NRL could have secured by doing a deal with Macquarie and Broadcast Operations.
The latter is believed to have made a final offer to the NRL late last wek, which was rejected.
"In addition to finding a way to keep Macquarie happy, the NRL has been under pressure to do a deal now," said a source.
"It had to resolve the rights negotions to give Macquarie time to start selling sponsorships to its 2006 coverage."

I would have thought that the NRL is a highly marketable commodity at the moment and the NRL should have been getting more revenue from radio rights not less. No doubt Jones and singleton pulling strings again.
 

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