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4 days ago
The one thing sponsors crave for is media coverage for the team or sport they are sponsoring - provided the coverage is even and reasonably favourable.
Well the Melbourne Storm have had extensive coverage - and nowhere has it been more extensive than in Melbourne where it has been in the coverage doldrums ever since it was formed. Front page on both the Melbourne dailies and it even made the BBC World Radio News last night!
But the Storm today is not only bereft of two premierships, and out of contention for the 2010 title, it has also lost two of its major sponsors and there are indications that more may follow.
Members Equity Bank and Host Plus have today terminated their sponsorship agreements with immediate effect.
Now it is being reported that car maker Suzuki and caravan company Jayco are re-considering their sponsorship agreements as well.
There is little doubt that if the Melbourne Storm was not wholly owned by News Limited its total demise would be just about inevitable.
If the Storm survives it will only be because News Limited wants it to - and is prepared to tip in even more to ensure it does.
The toughest penalty from the point of view of the Storm's viability is not the stripping of two premierships, or the fine, or the forfeiture of the million plus prize money won in winning the two premierships. It is not even the points won this year that have been stripped away. It is unquestionably the decision to effectively deny the Storm the right to win any more games this season.
The wooden spoon is the Storm's. Not even the Sharks can take it away!
But that penalty has consequences which may well threaten the viability of the Storm - unless News wants to tip in millions more. Even the Storm's News appointed Chairman has conceded today the club may fold.
How will the Storm, in a premiership season that still has close to five months to run, be able to attract sponsors, and crowds, at a new and larger stadium when there is only one prize the team can win - the wooden spoon?
And things will be tough in 2011...as the Storm have to reduce the amount it has agreed to pay players by $700,000 this year, and by an estimated $900,000 in 2011.
That can only be done two ways - either the players who have been given contracts above what has been declared to the NRL will have to accept what the NRL has been told they are getting OR the club will have to terminate three, and possibly four, of its higher paid players.
The logical step would be to bring player payments back into line with what the NRL has been told they are. But that may well cover as much as half a dozen, or even more, players. How many would want to stay for less than what they expect to get this year?
And if the club has to release three or four of its best players, what will that do for the morale of the rest?
Either way, the medium term future of the Storm on the field is doubtful - and off the field it is surely in the balance.
If News wants the Storm to survive it is going to have to outlay significantly more than the $8 million subsidy it gives the club already. And even if it does so, there is absolutely no guarantee of success on the field in 2011.
One thing is abundantly clear to me - the Storm will only survive if News wants it to, and provides the millions extra needed to enable it to!