In 2006, John O’Neil announced that the FFA had signed a television contract with Foxtel worth $120 million which would secure for Foxtel the broadcast rights to basically all top-level domestic football as well as Australian internationals for the next seven years. Everything was given to Foxtel, except for the next two World Cups. The deal was heralded as “a major boost for the sport in this country”. I thought O’Neil had signed a shocking deal.
David Rowe, a University of Western Sydney professor, stated in an article by David Sygall in the Sydney Morning Herald that the “deal was ill-advised and an opportunity lost” and that it is “against the national interest and should be investigated by Communication Minister.” I’d go further than that as the deal to me was made with shocking short-sightedness and is holding back the development of the league from where it should be. Yes, despite the well documented growth of football in this country over recent years, I think the growth could have been even more substantial if football was not hampered by the deal signed by O’Neil.
Let’s go back to early 2006 when the deal was signed. The deal was signed at the end of the inaugural A-League season which most people would agree was a success In early 2005, Australia had also must entry into the Asian Confederation which secured for the Socceroos a qualification path, for both the Asian Cup and the World Cup, against teams that the public would actually want to see as testified by the 50,969 who turned up to watch the game against Qatar. A-League clubs also secured entry into the ACL while the World Cup was also only months away. Against this background, the FFA signed a deal with Foxtel. The deal was signed at a time when the future of Australian football was still unclear as entry into the new federation as well as the success of the inaugural season of the A-League guaranteed nothing but did evidence the great potential of the sport in this country.
You could argue that Foxtel were also taking a risk as the A-League had only completed one season and there was no guarantee of future success or growth of the league. You could also argue that the market just didn’t value the broadcasting rights for football as Foxtel was the only bidder. Both above facts are true. What the FFA should have done was sign a short term deal with Foxtel rather than the lengthy 7 year contract that will run until 2013. Now Foxtel are laughing all the way to the bank when you compare the deals that the other codes secured.
At around the same time, the AFL announced a whopping $780m 5 year television deal while the NRL, which now has roughly the same average attendance as the A-League, in mid 2006 secured a deal worth $500 million that runs until 2012. Both these deals included contributions from free-to-air television networks as well as Foxtel. What is more amazing is that neither of these deals are really deals for the broadcasting rights to a “national” sport. What I mean by this is that neither the AFL nor NRL have universal support in all the states and territories, despite both trying to establish a national basis for their games. I am not saying that football has the largest following of the three codes in all parts of this country, but it is a national sport in that it is played and supported all around the nation. Try and find a casual game of AFL among locals in Sydney, I’ve yet to see one. In contrast, drive around Sydney on a Sunday and you will see casual and organised games of football throughout the city.
Additionally, football is clearly the only international sport out of the three codes. I doubt even the hierarchy of the AFL would call their sport international while rugby league doesn’t fair much better. This is probably most highlighted by, ironically, rugby league’s own World Cup when it is compared to the actual World Cup.
No doubt some will say that it is foolish to compare the deal that the FFA got with that secured by the NRL and AFL as football was still emerging from a period of administrative chaos when the deal was signed. However, this only supports the argument that only a short-term deal should have been signed. It is very logical not to sign a deal when you are in a vulnerable position. The FFA signed on at a time when A-League clubs were “facing crippling and unsustainable costs.” The FFA should have gambled on the potential which the game was clearly demonstrating rather than only thinking of its short term needs.
The deal has blunted the growth of Australian football in many ways. Only one in three Australian homes have Foxtel and as I previously mentioned, free-to-air coverage is essential for the growth of the game. It has also significantly reduced the ability of the clubs to retain their players which is ironic considering that the FFA were supposedly forced into signing the deal due to the financial situation of the clubs. Out of the three codes, only football needs to pay their players an internationally as well as nationally competitive salary. Rugby League’s constant complaints about the money available in England and in Rugby Union is a joke compared to what the A-League clubs have to face when trying to retain their talent. Despite having the most competition when it comes to retaining players, A-League clubs are the least capable compared to NRL and AFL counter-parts. This is mainly due to the ridiculous amounts of money available over season as well as tight salary caps each club is under and we now come back again to the television deal signed in 2006 that duded the sport.
If Grosso robbed the Socceroos and this country in 2006, the administration of the FFA, due to its short-sightedness, inflicted a much harsh and more damaging penalty on football in this country in the same year through the $120 million dollar deal that is a major boost to other sports in this country.
3 Comments
March 14, 2008 at 11:30 pm
I agree with this assessment. I didn’t like the sound of it when it was first signed. It wasn’t just the low amount, but the length of the deal, locking us into something second rate for far too long.
March 16, 2008 at 11:43 pm
I agree on some points but let’s not kid ourselves.. Which FTA network other than SBS would’ve picked up the rights to football?? Make no mistake, the Commercial Networks would’ve butchered the coverage as they did with the NSL before..
Like it or not, Foxtel is the home of football and I for one am happy about that.
Yes it would’ve always been nice to have gotten a bigger deal back then but it wasn’t to be..
March 17, 2008 at 9:50 pm
Like pippinu said, the crux of the article is about the FFA’s foolishness in signing such a long deal.
In early 2006, no FTA network would have paid for the rights and so Foxtel was the only bidder. In early 2008, I still doubt any FTA network would pay for the rights although I believe some would be interested in a limited subscription which would allow them to provide a highlights show.
In a few more years time, you might have a network interested in expanding coverage to a “game of the week”.
But we have no such option because the deal likes the game in 7 years. Foxtel isn’t the home of football, it is just that way at the moment because the FFA lacked the foresight to negotiate a shorter deal.
I don’t think FTA network’s would necessarily butcher the coverage. I think Foxtel’s coverage is pretty stock-standard in any case.