Channel 9: Rugby league parasite?

BY DAN

Channel 9 has finally admitted the obvious. It sees the National Rugby League as a competitor, something it needs to hobble in order for it succeed.

It was only a few weeks ago (seriously) when Channel 9 CEO Hugh Marks told the world that his partners at the NRL ran a shambolic organisation that had delivered little value to anyone over the preceding years. He said they had wasted all the money they had taken from an increased broadcast deal. He characterised the administration as bloated and inefficient, a claim without basis that was then picked up by idiots across the rugby league community like Paul Kent and Phil Gould, despite the abject lack of evidence beyond them yelling it.

Of course in reality the NRL administration costs to revenue ratio was around 4 per cent, in the same ball-park as it’s competitors and much less than a supposed ‘well-run’ organisation like Cricket Australia’s 7 per cent. The NRL had actually taken the extra revenue from the broadcast deal and invested it in the game, building a digital platform and expanding non-broadcast revenue from $80m in 2015 to near $200m in 2019. In a world governed by facts it would be considered a massive boon for the game. Hugh Marks’ claims it was ‘bloat’ are even more comical given he is now gutting Channel 9 because he over-committed them to making cost-savings to the Australian Stock Exchange. Rugby league was blamed despite the fact it effectively keeps the lights on at 9. And yet many in the game still take his rantings seriously.

At the time I called this an unprecedented attack without basis. I assumed, rightly, that it was an attempt to drive down the price the broadcaster paid for the product. But it’s apparently even more than this. In addition to seeking a reduction in the cost of rugby league, Marks is reportedly going even further, seeking to get his hands on the NRL’s digital platform.

This is a brazen and laughable attempt to take from league, particularly given his previous attacks on how broadcast revenue had been used by the NRL. The waste of revenue that was the digital platform is now part of new negotiations with V’Landys. The shamelessness is almost impressive.

Marks says this is to see the clubs adequately funded. He’s said some unmitigated horseshit before, but this is the peak. The clubs already get 130 per cent of the salary cap from the game. Either Marks has Donald Trump levels of delusion, or he’s deliberately trying to destabilise the game by sending it back to the bad old days when clubs ruled.

Getting control of the digital platform serves two purposes to Channel 9. Not only would it remove an existing competitor to eye-balls, it would also eliminate the long-term independence of the NRL from the broadcaster. Free-to-air television will exist for some time less, but day-after-day it becomes less and less important. Any forward thinking sporting competition knows a day comes when they need to reach customers outside of terrestrial television. Currently the NRL has developed a mechanism to circumvent the traditional broadcasters, much like the NBA has long-established in the USA. Channel 9 wants to eliminate that, and be the only way for the masses to find the games.

There should now be no pretence that the broadcaster is anything but a parasite on the game. It is seeking to take whatever sustenance it can from the game, without giving anything back. Any notion for a world in which Channel 9 is worthy partner looking to expand the games’ profitability, market and reach should be sent the way of the spear tackle.

This ambit claim should be ignored by the NRL and V’Landys has reportedly done so. I said recently that Peter V’Landys’ agreement to the initial criticisms would come back to bite him in the long term. This was right in theme but not in tempo. It’s already coming back to bite him. V’Landys used the criticism as an opportunity to get rid of Todd Greenberg, but instead he’s moved the margin that Channel 9 has to argue, and put the one of the game’s biggest assets in the negotiating pile, instead of the property of the NRL. This should be a major embarrassment to V’Landys, and raise serious questions with those that proselytise his leadership. Alas that ship has sailed.

The digital platform must be a part of the NRL going forward. The platform itself isn’t perfect, and is hardly the central point by which people are accessing the game (though more people watch this than Channel 9’s digital offering). However, it’s the foundation of something bigger, and with continued smart investment could be built into the primary mechanism by which people access the game over the coming decades. A long term focus is needed, and while V’Landys should be applauded for much of the short-term work he has done to bring the game back this season, his long-term vision, something we’ve questioned since December last year, has been dangerously poor.

The shame here is that was the strength of the previous administration. Todd Greenberg and Peter Beattie had put the game on the track towards a functional digital platform, expansion into Perth and even innovative in-game improvements like the Bunker which, while reviled within rugby league, is actually the envy of the Australian sporting world. The game damn well felt modern for a split second there.

It should also end the misgiving that rugby league entered the current crisis caused by Covid-19 in a poor state. It had near $200 million in cash and assets, has only had to take loans numbering $250m to cover costs in 2020 (compared to the near $500m the AFL has had to borrow). It has developed a digital platform that while imperfect, is already seen as a competitive threat by a broadcaster. It’s a further endorsement of Todd Greenberg’s regime, albeit too late to save the man’s job.

But it does give rugby league a very clear pathway forward. V’Landys would do well to treat Channel 9 like an enemy now, if he wasn’t already. They are no partners of rugby league.

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