Broadcast options for Australian Rugby
- Thread starter WorkingClassRugger
- Start date
Strewthcobber
Simon Poidevin (60)
Yeah - NFL, basketball, UFC and to a lesser extent NHL and baseball are pretty major draws for payTV.
To complicate things, they'd all be looking at their own offerings independent of a broadcaster as well
Do ESPN pull their channels from Foxtel and Fetch etc. if they launch a streaming service in Australia or do they keep those as existing revenue streams?
WorkingClassRugger
Michael Lynagh (62)
Disney haven't been slow in pulling their content off Netflix in preparation for the Disney+ launch later this year. They haven't pulled any of their content off Stan yet but that's likely to happen prior to that service launching here in 2020. So, there's definitely a precedent there. I'd be surprised if they didn't.
Strewthcobber
Simon Poidevin (60)
Who knows, but I reckon they would want to have a digital/streaming exclusive for their content. They might be alright with Foxtel, but not Go or Kayo
Strewthcobber
Simon Poidevin (60)
Maybe, but these things tend to follow the power law/Pareto principle. Big players get more, and smaller gets less very quickly.
Strewthcobber
Simon Poidevin (60)
Interesting stats in Roy Masters Column today on the massive debt issue facing Foxtel and Fox sports.
80% of broadcast funding for sports in Australia comes from Foxtel. Vast majority of that is AFL, NRL and cricket.
They need 5 Kayo subscribers to generate as much revenue as 1 Foxtel subscriber. They have 290,000 Kayo subscribers.
He doesn't flat out say it, but it does seems like the massive cricket deal and disappointing subscriber growth that hasn't resulted for Foxtel or Kayo is the main issue
80% of broadcast funding for sports in Australia comes from Foxtel. Vast majority of that is AFL, NRL and cricket.
They need 5 Kayo subscribers to generate as much revenue as 1 Foxtel subscriber. They have 290,000 Kayo subscribers.
He doesn't flat out say it, but it does seems like the massive cricket deal and disappointing subscriber growth that hasn't resulted for Foxtel or Kayo is the main issue
half
Dick Tooth (41)
Thats an astute observation.
I would also add two other points, first is a number of people have switched from Fox to Kayo which would reduce income, and secondly if they chopped some sports and lets say, Union, Soccer & Basketball all have reasonable numbers of subscribers to Fox that if Fox ditched these sports, they would leave having an effect on Fox revenues.
Many analysis-ts said at the time of the AFL, NRL & Cricket deals that Fox paid over the odds. I think its accepted by these sports they will get less in their next deals. The AFL is already talking to a number of streaming services and I am told is in serious opening discussions with Amazon .
half
Dick Tooth (41)
Read this on the Roar from a poster called Concern Supporter.
Foxtel’s Failing Financials
The data in the filing is the most detailed and comprehensive on Foxtel’s finances and subscriber numbers ever released. It doesn’t make for pleasant reading.
According to the filing, Foxtel had an operating loss of $417 million in calendar 2018, a loss of $268 million in the 2017-18 financial year, and an operating profit of $269 million in 2016-17. Revenue fell from $3.36 billion in 2016-17 to $3.14 billion in 2017-18. Subscription and advertising revenues fell as well.
But the big worry is the slump in subscriber numbers. Broadcast subscriber numbers (the core customer group for Foxtel) fell 211,000 from 2016-17’s 2.40 million to $2.19 million at the end of December 2018. That’s a 9% fall and at the ARPU of $78 a month, that’s around $200 million a year.
The rise in Foxtel Now — 714,000 at May 8, up from 132,000 in 2016-17 — and Kayo — up from 72,000 at the end of December 2018 to 305,000 at May 8 — hasn’t been enough to step the loss in revenue from broadcast subscribers and a 12% or $43 million slide in ad revenues.
Foxtel is in a worse financial state than other local legacy media groups such as Seven West Media, Nine/Fairfax, Southern Cross or even Ten. Throw in its still-shrinking local newspaper operations and it is clear the only business keeping News’ head above the water in Australia is its 61% owned REA group, the leading property website operator.
What is telling with the $300 million lent by News is that Telstra, a 35% shareholder in foxtel, didn’t contribute to the shareholder loan. Telstra knows a black hole when it sees one.
Foxtel’s Failing Financials
The data in the filing is the most detailed and comprehensive on Foxtel’s finances and subscriber numbers ever released. It doesn’t make for pleasant reading.
According to the filing, Foxtel had an operating loss of $417 million in calendar 2018, a loss of $268 million in the 2017-18 financial year, and an operating profit of $269 million in 2016-17. Revenue fell from $3.36 billion in 2016-17 to $3.14 billion in 2017-18. Subscription and advertising revenues fell as well.
But the big worry is the slump in subscriber numbers. Broadcast subscriber numbers (the core customer group for Foxtel) fell 211,000 from 2016-17’s 2.40 million to $2.19 million at the end of December 2018. That’s a 9% fall and at the ARPU of $78 a month, that’s around $200 million a year.
The rise in Foxtel Now — 714,000 at May 8, up from 132,000 in 2016-17 — and Kayo — up from 72,000 at the end of December 2018 to 305,000 at May 8 — hasn’t been enough to step the loss in revenue from broadcast subscribers and a 12% or $43 million slide in ad revenues.
Foxtel is in a worse financial state than other local legacy media groups such as Seven West Media, Nine/Fairfax, Southern Cross or even Ten. Throw in its still-shrinking local newspaper operations and it is clear the only business keeping News’ head above the water in Australia is its 61% owned REA group, the leading property website operator.
What is telling with the $300 million lent by News is that Telstra, a 35% shareholder in foxtel, didn’t contribute to the shareholder loan. Telstra knows a black hole when it sees one.
kiap
Steve Williams (59)
Published overnight, snippet summary below:
For sport on TV, it's a whole new ball game
By Roy Masters
May 17, 2019 — 11.38pm
Rupert Murdoch’s new media strategy – ‘‘get big, or get out’’ – has dire consequences for Foxtel and is therefore bad news for the future of Australian professional sport. Murdoch’s News Corp owns 65 per cent of the TV subscription service which funds 80 per cent of the broadcasting fees paid to Australian sport.
… The six-year cricket deal with Seven West Media was expected to drive Foxtel subscriptions and grow Kayo Sports, its wholly owned streaming service. But Kayo has only 290,000 subscribers and it needs five of them to compensate for the loss of one Foxtel subscriber.
Revenues have fallen 11 per cent, with Foxtel hit by the double whammy of churn and the average revenue per subscriber down. This has caused profits to decline catastrophically …
… That’s bad news for Rugby Australia which, unlike NRL’s partnership with Nine, and AFL and cricket with Seven, does not have a free-to-air broadcaster. Rugby’s Foxtel deal is ending and ratings are poor, with some games shown at times only insomniacs love.
Football’s contract is at the halfway point but one recent A-League round (five games on Foxtel and one on Ten) had a total audience of 100,000. A single NRL match can rate three times one A-League round.
Foxtel’s investment in other sports, such as V8 Supercars, will also be challenged and some will bleed to death via cost cuts.
… Industry experts suggest the long-term survival of Foxtel will be challenging. Colin Smith of Global Sport and Media believes that sport viewing on TV is facing the most profound period of change since the introduction of pay TV more than 30 years ago.
… <big snip> …
… with anti-siphoning legislation, a free-to-air broadcaster would be required to join the partnership. This, together with the changing trends of watching sport on TV, could mean Google, NRL and its long-term incumbent TV network, which is now the owner of this newspaper, are all together on, let’s say, Cloud Nine.
Read the full article: https://www.smh.com.au/sport/for-sport-on-tv-it-s-a-whole-new-ball-game-20190517-p51og9.html
kiap
Steve Williams (59)
I reckon RA could be, excuse the french, ratfarked [/k.rudd]
hoggy
Nev Cottrell (35)
Considering the size of the debt is there an argument that cutting or reducing rugby & soccer doesn't really address there financial issue's which are due to lack of uptick in subscribers from the AFL/NRL & cricket.
Also to remember rugby supporters were the original base of pay TV subscribers, reducing its content may have an adverse effect on what was its original core driver of subscribers.
To counter that is the timing, rugby is first deal of the block and quite frankly about as popular as a fart in an elevator right now.
Also to remember rugby supporters were the original base of pay TV subscribers, reducing its content may have an adverse effect on what was its original core driver of subscribers.
To counter that is the timing, rugby is first deal of the block and quite frankly about as popular as a fart in an elevator right now.
half
Dick Tooth (41)
Mate sent me this so I am going to put up 3 posts from the Mariners forum, its a thread where the CEO can be asked questions and or say what’s going on. Sorta management communication with fans.
The first two post are about the current TV deal and how it will effect, first the Mariners and second the A-League. The third is the CEO's response and its very interesting especially the J-League example he gives. Could this be a solution for rugby I have never heard of the app the CEO mentions. WCR maybe you know of it.
To the posts
Post 1 [Joyfulpenguin]
Hi Shaun,
If the tv deal is less or disappears all together will we survive? Does the club have a future without the FFA TV deal grant?
Post 2 [turbo]
If that happens and the money is cut off we wont have a league at all. That's not a CCM problem.
Post 3 [CEO's reply]
Yes both comments are correct if it was to happen now. Fortunately there is still a further 4 years on the Fox deal to go and that is a very long time in football. With the rapid changing modes of sport viewership trends it is impossible to predict now what the future looks like. If you look at the J-League they left TV broadcast altogether and started their own broadcast via an app called DAZN. This increased their revenues by over 10 times.
But yes without Fox today things would be very tragic.
The first two post are about the current TV deal and how it will effect, first the Mariners and second the A-League. The third is the CEO's response and its very interesting especially the J-League example he gives. Could this be a solution for rugby I have never heard of the app the CEO mentions. WCR maybe you know of it.
To the posts
Post 1 [Joyfulpenguin]
Hi Shaun,
If the tv deal is less or disappears all together will we survive? Does the club have a future without the FFA TV deal grant?
Post 2 [turbo]
If that happens and the money is cut off we wont have a league at all. That's not a CCM problem.
Post 3 [CEO's reply]
Yes both comments are correct if it was to happen now. Fortunately there is still a further 4 years on the Fox deal to go and that is a very long time in football. With the rapid changing modes of sport viewership trends it is impossible to predict now what the future looks like. If you look at the J-League they left TV broadcast altogether and started their own broadcast via an app called DAZN. This increased their revenues by over 10 times.
But yes without Fox today things would be very tragic.
Strewthcobber
Simon Poidevin (60)
A bit of propoganda from rugby.com.au.
https://www.rugby.com.au/news/2019/...0rPoDdFQ-9Cgbr-gDte2WcrwcFaJayW30qbw_RV696gg9 Take from it what you will
https://www.rugby.com.au/news/2019/...0rPoDdFQ-9Cgbr-gDte2WcrwcFaJayW30qbw_RV696gg9 Take from it what you will
Rebels3
Jim Lenehan (48)
At the end of the day Fox will do an analysis on if Rugby brings a positive return for the money they pay. If of the average 50k people that watch rugby 25k of them only have Fox purely for Rugby, then that’s a good thing. If for example a sport like cricket gets 100k viewing but only 15k have fox for the cricket and would happily watch it on fta then that’s an issue. So basically does it drive subscriptions in that they would get rid of fox without it, but some sports might be more popular but don’t drive subscriptions because it’s available elsewhere.
Are the time slots generating commercial revenue through advertising? What is the demographic of people watching (20k viewers of middle to high expendable wages is worth more than 50-70k of lower incomes, it’s harsh but the reality of business).
Does the programs allow for collaborative marketing opportunities? Strategic marketing.
It’s not simply going to be a simple they need to cut x amount. If rugby gets $25mil a year from fox but Fox generates $25.5 million return it ain’t going anywhere. The question is, does it generate this type of return?
Are the time slots generating commercial revenue through advertising? What is the demographic of people watching (20k viewers of middle to high expendable wages is worth more than 50-70k of lower incomes, it’s harsh but the reality of business).
Does the programs allow for collaborative marketing opportunities? Strategic marketing.
It’s not simply going to be a simple they need to cut x amount. If rugby gets $25mil a year from fox but Fox generates $25.5 million return it ain’t going anywhere. The question is, does it generate this type of return?
WorkingClassRugger
Michael Lynagh (62)
That's being reflected by social mefia companies increasingly looking to broadcast premium sporting content. But in order to do it you would have to plan exactly how to monetize your content very carefully.
Strewthcobber
Simon Poidevin (60)
There's one downside, watching the cricket world cup on kayo, and commenting on a private WhatsApp group with some mates all over the world.
There's 5 minutes difference in what live means depending on how and what you're watching. Wasn't an issue with broadcast TV.
Changes how I watch and enjoy sport
There's 5 minutes difference in what live means depending on how and what you're watching. Wasn't an issue with broadcast TV.
Changes how I watch and enjoy sport