Rugby Australia's renegotiation of their broadcasting rights is currently attracting plenty of attention in the media.
Firstly, the governing body turned down a renewal of rights with the incumbent rights holder Foxtel, instead opting to take the rights to a competitive tender process, in an assumed effort to try and garner more revenue from the content.
It has been reported that RA has attempted to court Optus into buying the rights, and RA are also reportedly keen on getting some content on free-to-air on a weekly basis, and so are engaging Channel 10 and Channel 7, while there are also anti-siphoning restrictions in place for the Wallabies games (as if those protections mean anything anymore).
Secondly, they took back control of the rights to the NSW Shute Sheild and Queensland Premier Rugby competitions, in an effort to gather up all their rights and take them to market in a single package.
However, this strategy has some potential flaws. Firstly, while Optus have expressed some interest in the RA rights, they have never paid for the production of sport, preferring instead to buy digital rights to content that is being produced by a traditional broadcast company, such as the EPL or World Cup. They may also be still smiting from the World Cup streaming debacle.
Foxtel are also looking to cut their spend on rights and production, while the ratings for the sport have been in a steady decline for about 10 years as well as the Folau issue. RA had the opportunity to renew rights with Foxtel in a deal that would have seen them maintain their current level of yearly revenue from the News Corp-based company.
However, RA's strategy of gathering up all of their rights and trying to sell them to a single bidder in a competitive tendering process also reminds me of that undertaken by the NHL when their rights came up for auction in Canada in 2013. At that time, CBC had held the free-to-air rights for 40-odd years, while Bell Canada/TSN had the subscription rights. Digital rights were split among a number of broadcasters.
However, the NHL bucked the CBC and Bell during negotiations, instead giving all rights exclusively to Rogers in what is known as a 'Gatekeeper' model of rights tendering. Rogers paid an incredible amount for the rights for 12 years, but they have exclusive rights across all platforms.
The story of the sale of the NHL rights in Canada at this time is expertly told in Hockey Fight in Canada by David Shoalts. Good read.
Is RA attempting their own Gatekeeper sale of rights to a single media organsiation, who will control all the right exclusively, but carry the burden of monetising those rights and can parcel them out to anyone they want?
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