38 hours ago - 8 Likes
Off the Wall
Yesterday's federal court decision upholding Optus's right to put video of sporting events on its mobiles and tablets may turn out to be a significant financial setback for the NRL.
The most immediate consequence is that the $153 million windfall the AFL received from Telstra for online rights looks like going out the window...even before the deal kicks in.
The NRL was clearly hoping to get a similar, if not greater, deal from Telstra - the game's major sponsor already - as part of the post 2012 rights package.
That must now be in doubt if not out of the question for the immediate future.
Telstra is not going to pay top dollar for internet rights when other users can effectively get the same for nothing.
The issues are complex - and centre around a clever manoeuvre by Optus to try and ensure its downloads and streaming to its clients does not breach the Copyright Act.
The federal court found in favour of Optus - but that decision will unquestionably he challenged in the high court.
And that means it could drag on for a year, or more.
The AFL looks like being short around $150 million immediately - and that will be a problem as its total package has already been divvied up among players, clubs, and challenging rugby league.
The NRL will start negotiations when the Independent Commission takes control - allegedly in a couple of weeks time.
This is a serious setback for our game's hopes of securing over $1 billion.
It doesn't just devalue - or totally destroy the value - of online rights, it may have implications for other rights as well.
My view is that the capacity of the television industry to pay top dollar for sporting rights has declined since the AFL sealed their deal.
And the success of the Big Bash cricket competition just adds another competitor in a tough climate.
I am not totally pessimistic about rugby league's position - but it is not going to be a pushover getting what the game deserves, and most assuredly needs.
We have a great product, our fan base is very loyal, and the 2011 ratings were good.
But there can be no question yesterday's decision just makes the IC's task that much harder.