Foxtel’s sale could change the game for two sports in Australia

While the Foxtel-DAZN deal awaits the tick from regulators, the tie-up of the two billionaire-owned platforms is giving the bosses of the NRL and the A-Leagues plenty to think through.

The seismic deal, which values Foxtel at $3.4 billion, adds another layer of intrigue to a number of upcoming rights negotiations, particularly for the NRL, which will have to decide whether to double down on a Murdoch-less Foxtel, or to take a chance on a one-stop-shop option with either Paramount or Nine (the owner of this masthead).

The NRL is kicking off its next rights negotiations early, chasing major dollars before the bubble bursts on the value of sports rights. Foxtel has the AFL locked in until 2031, and the same goes for its deal with Cricket Australia.

Foxtel broadcasts Australia’s two biggest codes, the NRL and the AFL.Credit: Artwork by Marija Ercegovac

Whichever way you shake it, the AFL is the larger sport in Australia. Its total average audience per game and viewership for the grand finals exceeds that of the NRL. The code also boasts a higher on ground attendance.

As for the NRL, it is streamed for free by more Australians than are games in the AFL. That’s largely because it’s been available for free on Nine’s video on demand service 9Now for quite some time. The AFL has only recently started streaming on Seven Network’s free digital on demand platform, 7Plus.

In a highly competitive tender process, the AFL landed a seven-year, $4.5 billion contract with Seven and Foxtel in 2022. The broadcast rights attracted bids from all major broadcasters, including Network 10’s owner Paramount, which like Nine, wanted to split all matches across its streaming platform Paramount+ and its free-to-air network.

NRL top honchos Andrew Abdo and Peter V’landys are desperately keen for a similar bidding war to erupt, but the picture has changed somewhat from when former AFL boss Gillon McLachlan brokered the record deal to where things stand now. For one, advertising revenue for the major media players has fallen off a cliff, and now Foxtel is close to having a new owner, one that could well have more pressing concerns than paying through the nose for rugby league.

While Foxtel and DAZN executives say they are committed to whatever sport does well domestically, their word may be put to the test when at the negotiating table, and V’landys knows money is not the issue. After all, DAZN just forked out $1.6 billion for the right to broadcast the 2025 FIFA Club World Cup.

Foxtel boss Patrick Delany with the Australian Rugby League Commission’s Peter V’landys.Credit: Getty

But with the Murdochs out of the picture, the doubts will be on DAZN’s intent and whether it sees value in chasing the sport. DAZN may view rugby league as an asset out of shape with its aspirations to become the leading sports streamer across the globe, leaving room for either Nine or Paramount to swoop in.

One sporting code more simpatico with DAZN’s global strategy is the round ball game, football. Australia is home to a domestic competition in dire need of revival.

The Matildas are arguably Australia’s favourite sporting team but the round ball game is struggling domestically.Credit: Getty Images

The A-Leagues are in the penultimate season of a five-year deal with Paramount. And it would be difficult to argue the premier domestic soccer competition has regained its early cultural impact and awareness during its partnership with Paramount. And that’s despite marquee international signings and a relatively cheap entry point for customers to watch the games on Paramount+.

The A-Leagues seldom make mainstream headlines, aside from when its fans are behaving badly. And the domestic game is in the doldrums even as the popularity of the sport in Australia continues to grow. The Socceroos clinched a round of 16 World Cup spot in Qatar in 2022 but the code’s local appeal reached fever pitch with the Matildas’ semifinal run in the Women’s World Cup tournament on home soil a year later, solidifying them as arguably Australia’s favourite team.

Add to that Ange Postecoglou becoming the first Australian manager in English top flight football. His no-holds-barred style and uncompromising approach have made him the league’s most talked about coach. And Kevin Muscat is following in his footsteps, so it’s a worry the A-Leagues are very rarely in the picture.

Paramount has tried its best, but programmers follow the audience, and it took just one year into the deal for the network to dump the A-League Men’s Saturday night fixture off its main free-to-air channel. While it has made its digital service 10Bold the home of free football, the game has struggled to find new audiences, hidden away on the secondary channel for the nation’s third-largest network.

This weekend, for example, Melbourne Victory vs Sydney FC, the most historic rivalry in the 20-year history of the A-Leagues will air on 10Bold, while the main 10 channel will show a re-run of the fifth instalment of the Transformers film series.

Injecting some new life into the A-Leagues is desperately needed, and Foxtel’s new football-loving owner just might be the one to do it. Getting the leagues on Kayo would offer an accessible summer alternative for winter sport subscribers, without their having to take out a second subscription.

Add to this a potential big money investment from the Saudi Arabian Public Investment Fund (which has invested heavily in football) and its sports subsidiary SRJ Sports Investments, led by the former boss of Australian domestic football Danny Townsend, the dots connect themselves.

“[DAZN] have got a very big footprint in football, which we have not been in, so this might be a way for us to get back into that,” Foxtel boss Patrick Delany told this masthead, while noting world football, rather than local, was the more realistic option.

As for the Murdochs, getting the final approvals on the Foxtel deal will be a crucial step in clearing the decks in what is shaping up as a frenetic year for the Murdochs and News Corp. The family trust issues, inspired in part by the TV series Succession, now loom over everything the Murdoch empire touches.

Gaining access to exclusive sports rights and then broadcasting them to a sports mad public at a premium cemented Foxtel as a vital cog of the News Corporation machine in Australia.

But with the influence of its legacy assets on the wane, and the widening intrusion of streaming players into the live sports arena, News Corp has timed its exit well.

The sum of $3.4 billion is a hefty one for a business whose best days are behind it and News Corp boss Robert Thomson earlier this year signposted the sale as a step forward for the media behemoth to focus on the bits of the business, digital real estate, the Dow Jones and book publishing, that are making money and could deliver more of it.

With the succession drama yet to fully play out, liberating News Corp from Foxtel is a step towards clearing the decks for Lachlan Murdoch to do what he needs to, and that may include future sales of legacy assets that Thomson didn’t mention, such as news publishing.

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