Revealed: the $200 million broadcast offer met with radio silence
One bidder has made a significant offer for rugby’s broadcast rights, the other hasn’t even put a figure on the table. This is the inexplicable reason for the breakdown of the game’s 25-year partnership.
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Fox Sports executives are convinced Rugby Australia boss Raelene Castle never intended to renew their broadcast partnership after pitching her a $200 million deal months ago, only to receive deafening silence.
Castle has not made any counter proposal to Fox so they could secure the rights to rugby and will instead take the game to the open market within a fortnight, hoping to receive more coverage on free-to-air television.
However, The Daily Telegraph can reveal main rivals Optus have yet to make an offer to RA or even put a dollar value on the game.
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The Fox offer is for $40 million-a-year over five years, the same as the current deal despite Super Rugby’s cutting back of teams resulting in 30 per cent less content.
Castle rejected the proposal but in the ensuing months has not made any suggestion of what price she will settle for.
This had led Fox’s top brass to conclude she wants to end the 25-year partnership the broadcaster has had with rugby since the game went professional in 1996.
The existing overall package includes the pool sharing from SuperSport in South Africa, Sky in New Zealand, Britain’s Sky and Network Ten, and is worth $285 million, or $57 million a year.
Of that, Fox Sports paid $33 million a year (on the exchange rate at the time with the US dollar), or $165 million in total.
The Daily Telegraph has learned their new offer was of the same value in American dollars as this deal — $US125 million over five years. In 2015, that $US25 million per year was roughly $A33 million.
However, with the Australian dollar falling sharply against the greenback, the same $US25 million is worth nearly $40 million a year to RA now.
That $200 million sat in front of RA for months with no counter-offer.
Castle is taking a huge gamble by going to market, hoping Optus will make a bid for the rights to supplement Network Ten and potentially the streaming service RugbyPass.
Her motivation is to get Super Rugby games live in primetime on Ten – which Fox won’t agree to because they want to retain exclusivity. Castle believes that by exposing a bigger audience to Super Rugby via Ten, the struggling code will see a revival.
However, Castle needs Optus to pick up a huge chunk of the broadcast money, with the free-to-air worth of rugby valued at less than $5 million a year.
RA’s negotiations are being led by Shane Mattiske, who played a key role in the NRL securing a $1.2 billion broadcast deal in 2014.
Fox Sports is owned by News Corp, publishers of The Daily Telegraph.
RA wants the backing of NSW and Queensland to take their club rugby competitions and fold into their “whole of game” package.
The big carrots RA will dangle to broadcasters is the 2023 World Cup in France, and the British & Irish Lions tour of Australia in 2025.