AFL the winner of broadcast battle

The AFL is giving less money back to the broadcasters than the NRL.

The AFL sealed a revamped broadcast deal with Channel 7 just hours before the season relaunched when Richmond took on Collingwood at the MCG on Thursday Picture: Getty Images

The words of AFL chief executive Gillon McLachlan to The Weekend Australian a week ago turned out to be prescient, when it comes to billions of dollars worth of television deals.

“How you start is a very small part of the story. It is how you finish­, in what shape on and off the field — that is more important and I am really bullish about how we are set up to get the season away,” he said when asked about the AFL’s arms race with the NRL.

Australian Rugby League Commission chairman Peter V’landys had struck the first blow in getting the NRL back on the field two weeks ahead of the AFL, but in money terms it seems McLachlan and his sport have won the race for now.

Thursday night, or to be precise the early hours of Friday morning when contracts were finally signed, turned out as good as the AFL hoped.

Or certainly less bad than McLachlan and his high-powered AFL Commission had once feared, if forgoing about $150m in television income over the next three seasons than was originally called for can be cast in a positive light.

The AFL agreed to re-do existing contracts with Seven West Media, Foxtel and Telstra until 2022 at a level which is said to be about 12.4 per cent less than the previous annual value of what was a record $2.508bn agreement struck in 2015.

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It means the AFL is getting $50m less each year for the next three years from its broadcasters.

They are deals done in light of fewer matches this year and a lack of crowds — for now — to give televised games real atmosphere, as opposed to pre-recorded inserted noise, and to take into account that the sports broadcast bubble over the past two decades is over for now.

But it is still an extremely good deal, given Seven will pay $730m between now and 2024.

What that basically means is that Seven gets discounts for the next three seasons — it says it will save $87m overall including production costs — but then goes back to roughly the record rate it has been paying previously, for 2023 and 2024.

There is no discount for those years, nor a big increase. But in the current light a deal not going backwards is a significant achievement for a sport.

Meanwhile, the NRL was rightly lauded for restarting its action on May 28, sorting a deal recasting its Nine Entertainment agreement through to 2022 and extending with Fox Sports until 2027.

But the NRL is forgoing at least $150m revenue itself for the next three years, potentially even more. (It did not release any details of its deal — the first time a sport has not crowed about the value of its contract in recent memory.)

In percentage terms, it is probably about 20 per cent — maybe slightly less — of its previous TV income, so therefore more in relative terms to the AFL.

There is some devil in the details. The AFL could not clinch an extension with Fox Sports, and might hope for an unlikely scenario where a global streaming giant bids for its rights before 2022 — otherwise Foxtel remains its best option for another big payday.

Similarly, the NRL still needs to extend its free-to-air deal past 2022.

But V’landys’s achievement in getting Fox Sports to agree to another five years of rights is nothing to be sniffed at. It is probably worth about $1bn over that time. And the NRL still has digital rights and a free-to-air contract to clinch.

It gives rugby league the chance to turn McLachlan’s words back on him once again, but for now at least the AFL still continues to be the biggest money sport in town.