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by Johnson Leung reporting for AFANA from Melbourne

Channel Seven, Foxtel and Telstra have retained Australian domestic TV rights for the AFL for six years, from 2017 to 2022, for a record breaking A$2.508 billion (US$1.84 billion), double the value of the 2012-2016 deal at A$1.253 billion. The AFL initially sought a broadcast deal that could last for 5-10 years and bring in as much as A$3 billion for the period. The League had repeatedly stated it was keen to conclude a new agreement by the end of 2015, even though it postponed talks for several months after reports Foxtel and Discovery Communications were planning a takeover bid for Channel Ten (Foxtel eventually bought a 15% stake in Ten for A$77 million on June 15 this year and Discovery did not participate). However, the surprise announcement of a new broadcast deal between the National Rugby League and Channel Nine on August 10 cause a speed up in negotiations for the AFL rights. This culminated in a new contract signed on August 18th. The deal was seen as essential for both Seven and Foxtel, with live sports on a free-to-air network key to attracting large audiences and used to cross-promote other programming, while Foxtel uses the AFL to attract subscribers to its pay TV services in Melbourne, Adelaide and Perth.

Main points of the new deal include:

  • The AFL remains in charge of scheduling. (In contrast, the NRL gave up and has had to fight to get back full control over it's "fixture".
  • The regular season stays at 22 games for each club, with a standard round of nine games per week. Outside of Thursday night games, public holiday games and bye rounds, each round will consist of 1 Friday night, 2 Saturday afternoon, 1 Saturday twilight, 2 Saturday night, 2 Sunday afternoon and 1 Sunday twilight game. This is similar to the present arrangement.
  • Channel Seven will broadcast the Grand Final and Brownlow Medal exclusively live (under the current deal the Brownlow is simulcast in Australia on Fox Footy). Each season, Seven will also broadcast live one game on Friday night, Saturday night, Sunday afternoon, plus five Thursday night games and 11 games on public holidays and the day before public holidays. On average Seven will broadcast 3.5 games per week and all games will be broadcast in high definition from 2017. All games are fed internationally in HD (beginning earlier this year).
  • Fox Footy will continue to broadcast live all nine games every week during the regular season, as well as the first three weeks of the Finals.
  • Telstra retains digital rights to stream games on smartphones, tablets and game consoles like XBox and Playstation. AFL games will also be available on the company's new streaming service Telstra TV from September. It also retains the rights to afl.com.au, the official websites of 18 AFL clubs, the AFL Live app and IPTV. International rights were not part of this but are impacted because Telstra must cooperate with any international internet distribution. The extraordinary high price paid by Telstra all but guarantees international fans will continue to be charged annual fees that are very high in comparison to other sports.

In a major change, News Corp has bought the right to sub-license a Saturday game, scheduled at the new time of 3.20pm AEST, to another free-to-air network. The AFL had offered this game to Nine during negotiations, but the network declined due to the cost, believed to be A$30 million per season. Nine could still acquire the game later, as part of an exchange for one of its NRL games. The game could also go to Ten, and in that case, would mark the network's return to AFL broadcasting since 2011.

The new NRL contract sees Nine paying A$925 million (US$677 million) to broadcast and stream live one game on Thursday night, Friday night, Saturday night and late Sunday afternoon, from 2018 to 2022. The NRL is still in negotiations for the Pay TV and international broadcast rights and is still hoping its total rights deal will be worth around A$1.7 billion.

The new AFL broadcast deal includes contributed advertising and promotion valued at A$200 million. News Corp, which owns half of Foxtel, will pay A$1.3 billion, Seven will pay A$840 million in cash and A$60 million in contribution promotion, while Telstra (Foxtel's other half-owner) will pay about A$300 million for the digital rights. The new AFL deal is worth A$418 million a year (up from A$250 million a year under the current contract) while the new NRL agreement with Nine is worth A$185 million a year.

News Corp Executive Chairman Rupert Murdoch took part in AFL rights negotiations after the NRL deal was struck (he had been in Australia during the week on company business). He and News Corp Chief Executive Robert Thomson attended the press conference in Melbourne to announce the massive deal, along with AFL Commission Chairman Mike Fitzpatrick, Chief Executive Gillon McLachlan, Seven West Media Chairman Kerry Stokes and Chief Executive Tim Worner, Seven Group Holdings Chief Executive Ryan Stokes (Kerry's son) and Telstra Chief Executive Andy Penn. Murdoch said the deal represented a "substantial investment" from his company, and pledged dedication to improving the sport. He said "We have always believed this (AFL) is the premium code in Australia. It is the national game and we are putting our money where we believe but we are also committing all our platforms' support in AFL everywhere in every state...We believe in the strength in the game, and we will do everything we can to make it stronger".

Kerry Stokes said his network's "very proud history" with the code helped negotiations and the network would be working during this northern winter to work out a way to start televising AFL games in HD sometime in 2016. He said he was still pushing for a Grand Final under lights, saying it will attract more viewers than a daytime Grand Final, but had not put any offer to the League. McLachlan replied the League was still divided on whether the Grand Final should be moved from its afternoon timeslot. Clearly a change to a "night" Grand Final would be disastrous for live viewing of the game in other parts of the world such as the US but given the size of the audience in North America, that is not a consideration for the AFL at present.

McLachlan said the new broadcast deal delivered maximum reach and exposure, financial security to clubs and players, and allowed the League "to focus resources to the foundations of our game - to ensure they stay strong, and grow into new areas, into new communities, to create new generations of supporters, members, players and volunteers." However, he would not be drawn on whether the League would use the money from the new contract to buy Melbourne's Etihad Stadium from the consortium of superannuation and investment funds, which currently owns the venue.

Fitzpatrick added players needed to benefit from the new deal. He said "besides their basic income, there's also a lot of welfare issues around the players in terms of when they finish, injuries and so on that we're spending a lot of time and money on". The AFL Players Association is angling for a bigger share of revenue from the broadcast rights. In March this year, McLachlan ruled out the AFLPA having a seat at the rights negotiations.

AFANA believes that this plus the NRL deal may accellerate international negotiations for rights of which the US remains the biggest market. We will be sharing our views on the future of coverage to the AFL soon. Once a new deal is done for the US or Canada we will report it to fans with analysis immediately.

Sources: afl.com.au, Melbourne Age, abc.net.au, AAP, Herald Sun, AFANA staff

Article last changed on Sunday, August 23, 2015 - 11:35 AM EDT


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