It\u2019s a battle of the financially weakening local C-suite against a Ukrainian\/Russian\/Anglo-American billionaire.<\/p>\n
The rights are presently shared by Foxtel and Nine until the end of next season. Foxtel\u2019s reported pitch would replace Nine\u2019s free-to-air component bringing both Seven and Ten on board, Seven broadcasting Sunday and Monday matches while Ten takes Thursday and Friday nights.\u00a0<\/p>\n
What Nine wants<\/p>\n
Nine itself would like all the rights to boost its Stan streaming platform which would in turn be a massive blow to Foxtel.\u00a0<\/p>\n
One way or the other, the AFR\u2019s Zoe Samios reckons the bidding war will deliver Rugby League (and Racing NSW) chief Peter V\u2019landys his $4 billion rights goal, a billion more than Nine was thought to be offering and double the existing agreement. <\/p>\n
Talk about inflation.<\/p>\n
It\u2019s always tempting to see conspiracy in local media games but this fight is international. It\u2019s three decades since the Packer v Murdoch \u201cSuper League\u201d war. Now there\u2019s no Packer involved in Nine and Murdoch has just a 6 per cent stake and one board seat on Foxtel\u2019s owner, London-headquartered DAZN, less than the Saudi government\u2019s 10 per cent and both percentages irrelevant given billionaire Len Blavatnik\u2019s majority holding through his Access Industries.\u00a0<\/p>\n
Blavatnik is Ukrainian born, Russian raised and a citizen of both the US and UK. He made his fortune buying into newly-privatised Russian commodities in the 1990s. Forbes estimates his worth at more than $50 billion.\u00a0<\/p>\n
The final quarter?<\/p>\n
Nine Entertainment\u2019s market capitalisation is $1.44 billion, struggling to hold at 91 cents a share, down a couple as the Foxtel bid news broke. It is trading at a price\/earnings ratio of 1.57, which means the market doesn\u2019t have much optimism about its future. It compares with an average PE ratio for the ASX 200 of about 20.\u00a0<\/p>\n
So it\u2019s deep pockets versus near-empty pockets as Nine just paid $850 million to buy an outside advertising company \u2013 billboards.\u00a0<\/p>\n
Thanks to the government\u2019s anti-siphoning rules, live sport remains free-to-air TV\u2019s bedrock. Having it at the wrong price though is poisonous, as Seven\u2019s slide towards oblivion demonstrates.\u00a0<\/p>\n
And with the company dominated by non-journalists, it\u2019s those expensive newsrooms that would be back in the frontline of cost cutting.\u00a0<\/p>\n
Should the Nine board and management get the equation wrong, the result could be fatal.<\/p>\n
There\u2019s no printers ink at the top of Nine<\/a>\u00a0and little to show for the alleged synergy that was supposed to come from Nine\u2019s takeover of Fairfax. A demerger would leave a cheap newspaper stable and a cheaper broadcasting arm up for grabs. <\/p>\n Heck, never mind about demerging.\u00a0<\/p>\n The importance of the rugby league contract to the company\u2019s existence might explain the duchessing of Peter V\u2019landy\u2019s interests beyond television. <\/p>\n Gambling ads furphy<\/p>\n Nine has been trying to make NRL be to the SMH what AFL is to The Age, elevating multiple NRL stories daily on the homepage above its politics, world, business and opinion sections.\u00a0<\/p>\n Another hare potentially set running by a $4 billion broadcast deal, if the Federal Government had any ticker, is burying the \u201csport needs it\u201d excuse for gambling advertising.\u00a0<\/p>\n Neither of the major local football codes face meaningful international competition for talent.\u00a0<\/p>\n The average AFL player on more than half a million a year and the average NRL player on $400K+ are paid that much because the money is there to pay them<\/a>.\u00a0If it wasn\u2019t, the games would go on regardless of the athletes (and CEOs) being paid a bit less.\u00a0<\/p>\n And please don\u2019t try the old lie of \u201cit\u2019s for the kiddies\u201d. Any government serious about encouraging children\u2019s sport would pick up the insurance bill and stop the massive subsidisation of the very rich business operations that are the AFL and NRL.\u00a0<\/p>\n \u00a0\u00a0<\/p>\n
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