Apr 17 2018
Free-to-air and pay-TV stations are stumping up an increasing amount of money for the rights to broadcast various sporting events. These lucrative contracts generate significant advertising revenue for TV stations. Online and digital streaming have provided opportunities for growth for sports administrators, as demonstrated by Optus paying a significant sum for the rights to the English Premier League and distributing it through various platforms. Live sports remain a valuable asset for TV stations, given the willingness of consumers to pay for watching sport in real-time.
Many new broadcast rights contracts across several sports have recently taken effect, or have finished negotiations. The AFL broadcast rights contract commenced last year, and is worth a reported $2.5 billion over six years. The NRL contract, which is split between Nine and Fox, took effect this year and is expected to run until 2022, with the league receiving $1.8 billion. Channel Nine secured the rights to the Australian Open and the summer of tennis, including lead-up tournaments to the Grand Slam, despite Channel Seven having broadcast the tennis for 40 years.
The latest deal to have been signed is for the cricket. The broadcast rights for Cricket Australia were previously shared between Channel Nine and Channel Ten. Channel Nine held the rights to the international cricket games in the Test, one-day and Twenty20 formats, while Channel Ten held the rights to broadcast the Big Bash League. The deal was worth $500 million and expired in the summer of 2017-18.
A ball-tampering scandal during the Test series in South Africa threatened to throw broadcast rights negotiations into disarray. Cricket Australia also lost several sponsorships following the scandal, including wealth management company, Magellan, the former naming rights sponsor to domestic Test matches. The Commonwealth Bank also cut ties with one of its cricket ambassadors, former captain Steve Smith, despite continuing its support for Ellyse Perry and Meg Lanning, women’s and grassroots cricket.
However, Cricket Australia managed to push through the commotion, signing a six-year broadcast rights contract reportedly worth just under $1.2 billion with Channel Seven and Fox Sports. This is significantly higher than the $900 million joint bid tabled by Channel Nine and Channel Ten and the previous $500 million deal. This increase highlights the big-business nature of sports in Australia, and the lengths that TV stations are willing to go to secure the rights to these events.
The new agreement will see Men’s Test matches and Women’s Internationals broadcast by both Channel Seven and Fox Sports. Fox Sports will have exclusive rights to Men’s limited-overs formats, including one-day and Twenty20 internationals. The Men’s and Women’s Big Bash League (BBL) will be broadcast on both Channel Seven and Fox Sports, although Fox Sports hold exclusive rights to 16 Men’s BBL matches. Several other cricket events will be available for viewing through online and digital platforms directly through Cricket Australia.