The NRL has identified its immediate viability as a priority and is willing to suffer some long-term pain for a short-term gain as it deals with the heavy financial fallout of the COVID-19 outbreak.
The NRL is backing itself to reduce costs, including around what Nine described as “a bloated head office”, to sustain itself and nullify what is likely to be a reduced broadcast revenue stream in years 2023, 2024 and 2025.
Fox Sports and Nine agreed to pay a total of $1.8 billion to the NRL as part of the current broadcast cycle (2018-2022), but now want to renegotiate the terms and value of the deal due to the changing circumstances caused by the coronavirus pandemic.
Consideration will also be given to a push to empower the clubs, a request from Nine as part of a bid to rejuvenate the game and move towards a decentralised governance model like the English Premier League’s.
Such a move would see clubs continue to receive $13 million in distribution grants each year regardless of whether the salary cap drops from $10 million in coming seasons or if broadcast revenue falls – a move not surprisingly being backed by the biggest hitters in club land.
It was only in October, at his first press conference as ARLC chairman, that V’landys outlined his bullish aim to strike a more lucrative broadcast deal for the game in the next negotiation round.
“To me, that is the most important aspect, to ensure the game stays viable. If you’re not viable, you’re nowhere. It’s critical we continue to get the revenues we’re getting,” V’landys said at the time.
He has had to dramatically alter his vision and is now moving closer to agreeing to an extension that will allow enough breathing space for the market to recover and time to increase the game’s cash flow.
Then the NRL can set its sights on securing the kind of deal that only two months ago saw V’landys and now interim chief executive Andrew Abdo fly to the west coast of the US to meet with digital giants like Google, Amazon and Facebook.
It’s unclear what this means for the game’s streaming rights or whether the governing body will seek the return of the streaming rights from both Channel Nine and Fox Sports, which sublicenses its digital rights to Telstra for about $20 million a season.
The current arrangement around broadcast exclusivity, with Channel Nine pushing for more exclusive matches, could also have a major impact on the game’s streaming rights setup.
Michael Chammas is a sports reporter with The Sydney Morning Herald