Ten 'bids to renew RA deal, with Amazon also interested'
Network Ten, the Australian commercial broadcaster, has bid to renew its free-to-air rights with Rugby Australia to air Test matches of national team the Wallabies but has requested a cheaper deal from the embattled governing body, it has been reported.
RA’s previous five-year rights deal, for 2015 to 2020, with pay-television operator Foxtel and Ten was worth a total A$285 million ($201 million).
It included the rights to the Super Rugby club competition, The Rugby Championship for national teams, other Australian test matches and domestic games.
Under the deal, Ten pays RA around A$3.5 million per year to broadcast Australia test matches. International tests played in Australia and New Zealand and all matches of the Rugby World Cup that involve Australia must be broadcast free-to-air under Australian anti-siphoning laws.
Industry sources told Sydney Morning Herald Network that Ten had lodged its bid late last week, offering to remain the free-to-air broadcaster of Wallabies matches beyond this year, but for a lower price than its last deal.
The length of the deal is said to be under discussion, as is the potential to pick up new game formats including a State of Union, a similar format to National Rugby League’s State of Origin.
Ten is the only free-to-air broadcast to bid for the RA rights so far. Fellow commercial broadcaster Seven Network previously told RA it was not interested, while Nine has discussed options but has not made a bid.
Foxtel has not put in a new bid to renew its rights but reportedly remains in discussions with RA over the rights to air Super Rugby and test matches.
Meanwhile, Amazon, the online retail giant, which this month secured the rights to the special Autumn Nations Cup in Europe has indicated its interest in the rights to RA but is yet to formally bid, according to Herald sources.
RA’s attempts to secure a new domestic broadcast deal for the next five-year cycle has been plagued by issues since former chief executive Raelene Castle rejected an offer from Foxtel worth A$35 million per year last November in the hope it would trigger a bidding war between broadcasters.
Castle issued a media rights tender in February and engaged media rights organisation Media Rights Value to help negotiate and maximise the value of their content.
However, the bidding war failed to materialise and the tender was halted in April due to the coronavirus pandemic, while Castle was forced to resign from the post amid criticism of her leadership and handling of the deal.
Since then, the pandemic has allowed broadcasters to renegotiate the amount they pay for rights to sports. For years the cost of rights had increased but the suspension of matches and lack of stadium audiences has allowed broadcasters to secure revised deals with codes including the NRL and Australian Football League.
It has been reported that the next RA broadcast rights deal is likely to be worth no more than A$20 million per year, representing a A$15 million shortfall on the previous Foxtel offer, down from the previous deal with Foxtel and Ten worth A$57 million per year.
Securing a new broadcast deal for the next 2021-2025 cycle is now a key priority for RA as it looks to recover from recent financial blows to the code.
Last week, long-standing sponsor Qantas, the Australian airline, ended its sponsorship with RA after 30 years. The governing body also lost HSBC as a major sponsor in December after the international banking giant decided against renewing its six-year deal.
In June, RA was forced to cut 40 per cent of its staff as part of emergency measures put in place to survive the coronavirus pandemic’s financial effects, after announcing losses of A$120 million the previous month.
It also asked remaining senior staff to take a permanent cut of 5 per cent in their base salary, while a further 30 contractors and casual workers also had their roles terminated to reduce the company’s wage bill by A$5.5 million.
Earlier this month, the governing body recruited Adam Foulsham, an experienced financial and operational executive, as its new chief operating officer tasked with reducing operating costs at RA by A$15 over the next few months to counter the expected shortfall from a future broadcast deal.