AFL announces 4.5billion, 7 year media deal (2025-2031 inclusive)

[JohnZ]

Dinsey own ABC and ESPN.

They do charge extra in the US for ESPN over the Disney+ bundle

Yes they do, but it's not as simple as that.

ESPN on cable (aka Foxtel here) carries Monday Night Football. ABC itself doesn't show many games at all (like 2-3 monday night games which are simulcast from ESPN), mainly the superbowl once every few years because it can't be on ESPN. The ESPN streaming service didn't used to have access to the games, but in the new deal they do.

But it's all extra charge on top of Disney+, which is what I was saying in what you quoted me. Disney/Netflix/Stan might go for the AFL rights, but if they do it will be a surcharge. Where as Amazon and Apple can provide it included in their streaming services, because they make money from converting their users in other ways (buying cheap s**t from Amazon or expensive s**t from apple)

 

[threenewpadlocks]

Dinsey own ABC and ESPN.

They do charge extra in the US for ESPN over the Disney+ bundle

But they do consider Disney+ and ESPN+ to be separate subscriptions which is the whole point, and if you look at how they're navigating their new NHL deal and UFC toward ESPN+, there's a trend there

 

[Kwality]

The latest attempt by Seven to take over Prime will give Seven 'more bang for their buck' next time the AFL media rights come 'round:
Mr Warburton said the latest move would significantly bolster Seven’s strength in the Australian media market and allow it to reach an even larger audience.

“The acquisition means Seven will become Australia’s leading commercial premium broadcast, video and news network, with the potential to reach more than 90 per cent of Australia’s population each month,” he said.

“It means we will be able to give advertisers easy and seamless access via a single platform to capital city and regional markets.”

NoCookies | The Australian

www.theaustralian.com.au

and with an eye to potential opposition:

https://mumbrella.com.au/seven-and-prime-media-deal-set-to-rationalise-costs-and-

challenge-global-behemoths-710858

 

[The_Wookie]

The latest attempt by Seven to take over Prime will give Seven 'more bang for their buck' next time the AFL media rights come 'round:
Mr Warburton said the latest move would significantly bolster Seven’s strength in the Australian media market and allow it to reach an even larger audience.

“The acquisition means Seven will become Australia’s leading commercial premium broadcast, video and news network, with the potential to reach more than 90 per cent of Australia’s population each month,” he said.

“It means we will be able to give advertisers easy and seamless access via a single platform to capital city and regional markets.”

NoCookies | The Australian

www.theaustralian.com.au

and with an eye to potential opposition:

https://mumbrella.com.au/seven-and-prime-media-deal-set-to-rationalise-costs-and-

challenge-global-behemoths-710858

Its still baffling how Seven didnt take any streaming for either the AFL or Cricket though

 

[Kwality]

Its still baffling how Seven didnt take any streaming for either the AFL or Cricket though

Will the success of the Olympics streaming be an influence ? Are the AFL or Cricket limited by current contracts?

 

[RussellEbertHandball]

Its still baffling how Seven didnt take any streaming for either the AFL or Cricket though

Telstra bought streaming rights for $300m for 2017-22 and 7 bought the 3.5 games a week for $840m + $60m advertising contra. They wouldn't have been able to afford what Telstra paid. Not sure how you would split streaming rights.

Given around the time the 2017-22 deal was negotiated, News Corp became the main negotiator and not Foxtel for the AFL rights, News Corp either had acquired or had set in motion to acquire 65% of Foxtel and Telstra reduced their share down from 50% to 35% and Fox Sports was thrown into the 65/35 mix, after going from 50/50 Murdoch/Packer to 50% Murdoch and 50% others to 100% Murdoch, between 1995 and 2015/16, and then them being owned by Foxtel and effectively a 65/35 Murdoch/Telstra ownership split, it was relatively easy to transfer the streaming rights from Telstra to Kayo.

 

[Rob]

Will the success of the Olympics streaming be an influence ? Are the AFL or Cricket limited by current contracts?

Bit of a difference there, 90% of the Olympics was only watchable through streaming.
I watched most of the Olympics through 7plus because I had to, not because I wanted to.

 

[Bjo187]

Excuse my ignorance here and please feel free to knock my idea on the head if I am missing something major, but a few things from just reading code wars that I noticed is:

- the afl has over 6 million fans across Australia
- the afl has over 1 million club members
- they only get a few hundred million from each 7 and foxtel each year, around 500 mill combined per year.
- fujak suggested the a league could start their own broadcasting due to not much interest.

The question I have out of this is, why is the afl not starting their own company to stream all their games for a subscription fee? Obviously they would still have the free-to-air deal with ch7 games, but then the subscribers money on top of this. When you look at how many people sign up to Kayo or Foxtel specifically just for AFL it could be a few million people per year at say $19 per month x 12. That would put it well over 500 million per year even before selling the fta rights to 7. Obviously they'd need to put aside 100 mill or something for production costs per year, but wouldn't they be making a whole lot load more this way?

* I forgot to add they would also get income through advertising being paid directly to the AFL for adds during games.

 

[Gigantor]

Excuse my ignorance here and please feel free to knock my idea on the head if I am missing something major, but a few things from just reading code wars that I noticed is:

- the afl has over 6 million fans across Australia
- the afl has over 1 million club members
- they only get a few hundred million from each 7 and foxtel each year, around 500 mill combined per year.
- fujak suggested the a league could start their own broadcasting due to not much interest.

The question I have out of this is, why is the afl not starting their own company to stream all their games for a subscription fee? Obviously they would still have the free-to-air deal with ch7 games, but then the subscribers money on top of this. When you look at how many people sign up to Kayo or Foxtel specifically just for AFL it could be a few million people per year at say $19 per month x 12. That would put it well over 500 million per year even before selling the fta rights to 7. Obviously they'd need to put aside 100 mill or something for production costs per year, but wouldn't they be making a whole lot load more this way?

While the AFL can generate $500 million per annum in broadcast revenue, why would you try going it alone?
You'd only really be counting on $100 to $200 per subscriber per season.
One million subscribers only brings in $100 million to $200 million.
And it might be hard to get to one million subscribers, at least initially.
So the play is to wait until the $500 mill deals are no longer forthcoming, then you worry about carrying the risk yourself.

 

[Kwality]

Brief mention in the financial press discussing SEVENs successful takeover of Prime.

NoCookies | The Australian

www.theaustralian.com.au

'Today Prime reaches much of eastern Australia with its footprint across regional NSW, ACT, Victoria, Queensland’s Gold Coast region and regional WA. This gives it the biggest geographical footprint of the broadcasters and, crucially for affiliate Seven, a regional broadcast signal into the states where AFL dominates. This AFL reach is seen by those inside Prime as its key bargaining chip with Seven, although others argue it has not been used hard enough.

With a little over two years left on its five-year deal with Seven, Prime’s board was concerned that regional broadcast rival Southern Cross Media was planning an all-or-nothing play for the Seven broadcast signal. (Southern Cross is Ten’s partner in most markets).'

 

[Kwality]

Excuse my ignorance here and please feel free to knock my idea on the head if I am missing something major, but a few things from just reading code wars that I noticed is:

- the afl has over 6 million fans across Australia
- the afl has over 1 million club members
- they only get a few hundred million from each 7 and foxtel each year, around 500 mill combined per year.
- fujak suggested the a league could start their own broadcasting due to not much interest.

The question I have out of this is, why is the afl not starting their own company to stream all their games for a subscription fee? Obviously they would still have the free-to-air deal with ch7 games, but then the subscribers money on top of this. When you look at how many people sign up to Kayo or Foxtel specifically just for AFL it could be a few million people per year at say $19 per month x 12. That would put it well over 500 million per year even before selling the fta rights to 7. Obviously they'd need to put aside 100 mill or something for production costs per year, but wouldn't they be making a whole lot load more this way?

* I forgot to add they would also get income through advertising being paid directly to the AFL for adds during games.

FTA battles to turn a profit on the $millions involved in that business these days, see 10 battles as to turn around poor ratings.
The CEO's for example, earn much more than Gil, because they are the best their roles can find.
The same applies to Foxtel (Murdoch & Telstra).

Both segments are rapidly changing their business models in an evolving world.

North president Ben Buckley https://au.linkedin.com/in/ben-buckley-71015786 is well experienced in both sport & media
&
so is AFL Commissioner Kim Williams https://www.mup.com.au/authors/kim-williams

I'm confident the AFL assess the market place for what they see as best for the game.

 

[The_Wookie]

Brief mention in the financial press discussing SEVENs successful takeover of Prime.

NoCookies | The Australian

www.theaustralian.com.au

'Today Prime reaches much of eastern Australia with its footprint across regional NSW, ACT, Victoria, Queensland’s Gold Coast region and regional WA. This gives it the biggest geographical footprint of the broadcasters and, crucially for affiliate Seven, a regional broadcast signal into the states where AFL dominates. This AFL reach is seen by those inside Prime as its key bargaining chip with Seven, although others argue it has not been used hard enough.

With a little over two years left on its five-year deal with Seven, Prime’s board was concerned that regional broadcast rival Southern Cross Media was planning an all-or-nothing play for the Seven broadcast signal. (Southern Cross is Ten’s partner in most markets).'

Of note - Nine will apparently not make a play for WIN regardless of Sevens move, but theres considerable cross staffing and operations now.

 

[Bjo187]

FTA battles to turn a profit on the $millions involved in that business these days, see 10 battles as to turn around poor ratings.
The CEO's for example, earn much more than Gil, because they are the best their roles can find.
The same applies to Foxtel (Murdoch & Telstra).

Both segments are rapidly changing their business models in a rapidly evolving world.

North president Ben Buckley https://au.linkedin.com/in/ben-buckley-71015786 is well experienced in both sport & media
&
so is AFL Commissioner Kim Williams https://www.mup.com.au/authors/kim-williams

I'm confident the AFL assess the market place for what they see as best for the game.

Yeah I'm sure they would have crunched the numbers, just my own off the cuff estimations had it making a significant percentage more than what they get from foxtel and that's not even including commercials during play. Might be a good opportunity to cash in and get a further lead over competitors with the nrl agreeing to shut down their own content production to appease ch9, news ltd etc. in their latest deal.

 

[Kwality]

Yeah I'm sure they would have crunched the numbers, just my own off the cuff estimations had it making a significant percentage more than what they get from foxtel and that's not even including commercials during play. Might be a good opportunity to cash in and get a further lead over competitors with the nrl agreeing to shut down their own content production to appease ch9, news ltd etc. in their latest deal.

The biggest problem at this time is that the moneys rolls in & is predictable - whats you best guess of the funding required when you advise the industry is not longer required.
The idea that NRL has appeased 9 by extending it current deal is curious given the AFL have gone down that path themselves.

 

[Kwality]

Of note - Nine will apparently not make a play for WIN regardless of Sevens move, but theres considerable cross staffing and operations now.

True of the status quo at the time of the article.

Its a done deal pre Xmas:

Prime Media (ASX:PRT) agrees to $132m takeover by Seven West - Lending Association

Prime Media (ASX:PRT) shareholders gave enormous support in the $132 million takeover bid from Seven West Media (ASX:SWM) with 99.9 per cent approving the deal. The meeting was chaired by the Chair of Prime, Cass O’Connor reaffirming the board’s unanimous recommendation for the deal...

lendingassociation.com.au

 

[Bjo187]

The biggest problem at this time is that the moneys rolls in & is predictable - whats you best guess of the funding required when you advise the industry is not longer required.
The idea that NRL has appeased 9 by extending it current deal is curious given the AFL have gone down that path themselves.

Not by extending, I was referring to this:

'The National Rugby League has bowed to pressure from its media partners and decided to scale down its digital content arm in a move that is expected to result in several redundancies at the organisation.
The shift, led by the NRL’s recently appointed chief customer and digital officer Alexi Baker, is part of an ongoing effort to streamline operations at the NRL to save costs and better serve fans. But it will also be considered a win for the company’s two media partners - Nine Entertainment Co and News Corp Foxtel - which have long expressed frustration about the division and argue the NRL’s own website competes with their digital properties.'

 

[Kwality]

Not by extending, I was referring to this:

'The National Rugby League has bowed to pressure from its media partners and decided to scale down its digital content arm in a move that is expected to result in several redundancies at the organisation.
The shift, led by the NRL’s recently appointed chief customer and digital officer Alexi Baker, is part of an ongoing effort to streamline operations at the NRL to save costs and better serve fans. But it will also be considered a win for the company’s two media partners - Nine Entertainment Co and News Corp Foxtel - which have long expressed frustration about the division and argue the NRL’s own website competes with their digital properties.'

This Alexi Baker:

Former Nine exec Alexi Baker joins NRL as EGM of customer and digital

The NRL has appointed former Nine exec Alexi Baker to the newly created role of executive general manager, customer and digital.Baker spent just over nine years at Nine, leaving as managing director of commercial in October last year. “Confirming Alexi Baker will join the NRL as executive...

mumbrella.com.au

April 30, 2021 11:20

The NRL has appointed former Nine exec Alexi Baker to the newly created role of executive general manager, customer and digital.
Baker spent just over nine years at Nine, leaving as managing director of commercial in October last year.

 

[Bjo187]

This Alexi Baker:

Former Nine exec Alexi Baker joins NRL as EGM of customer and digital

The NRL has appointed former Nine exec Alexi Baker to the newly created role of executive general manager, customer and digital.Baker spent just over nine years at Nine, leaving as managing director of commercial in October last year. “Confirming Alexi Baker will join the NRL as executive...

mumbrella.com.au

April 30, 2021 11:20

The NRL has appointed former Nine exec Alexi Baker to the newly created role of executive general manager, customer and digital.
Baker spent just over nine years at Nine, leaving as managing director of commercial in October last year.

Good to see she is still helping out her old organisation by shutting down any competition to it in her new gig

 

[Kwality]

Good to see she is still helping out her old organisation by shutting down any competition in her new gig

Its certainly interesting that she appears responsible for selling the deal to her new employer. Perhaps it reflects the deal done with benefits not previously understood by the NRL. Even the reason the NRL attracted her in the first place (creating a new role).

 

[JohnZ]

FTA broadcasters do less and less production in house year on year. Look at the new big brother. In years gone past, Ch10 would be hands on throughout the whole process. Now, Ch7 gets the finished product (due to it being pre-recorded) and ticks it off or sends it back.

More and more, sports production is going down the same route of being centralised and then on-sold to "distribution" partners. EPL, World Cup (Cricket and Soccer), Olympics etc.

Amazon won't do any production work for the NFL on Thursday Nights, but they've spent a lot of money to have the exclusive rights to distribute it in the US. It's inevitable that the AFL will either need to produce in-house or partner with an exclusive production company (say SEN or NEP, most likely a joint venture of the two) to allow them to sell the AFL as a completed product (see big brother above) to not only its FTA partners but also streaming companies.

 

[Kwality]

FTA broadcasters do less and less production in house year on year. Look at the new big brother. In years gone past, Ch10 would be hands on throughout the whole process. Now, Ch7 gets the finished product (due to it being pre-recorded) and ticks it off or sends it back.

More and more, sports production is going down the same route of being centralised and then on-sold to "distribution" partners. EPL, World Cup (Cricket and Soccer), Olympics etc.

Amazon won't do any production work for the NFL on Thursday Nights, but they've spent a lot of money to have the exclusive rights to distribute it in the US. It's inevitable that the AFL will either need to produce in-house or partner with an exclusive production company (say SEN or NEP, most likely a joint venture of the two) to allow them to sell the AFL as a completed product (see big brother above) to not only its FTA partners but also streaming companies.

Who pays the AFL if that model were to be adopted?

 

[JohnZ]

Who pays the AFL if that model were to be adopted?

7, 9, 10, Apple, Amazon, Foxtel, Stan etc. No different to now.

Instead of 7 (example) giving the AFL $200m per year and spending additional money on production, they can just give the AFL $250m per year and the AFL covers production costs.

 

[Kwality]

7, 9, 10, Apple, Amazon, Foxtel, Stan etc. No different to now.

Instead of 7 (example) giving the AFL $200m per year and spending additional money on production, they can just give the AFL $250m per year and the AFL covers production costs.

 

[RussellEbertHandball]

Excuse my ignorance here and please feel free to knock my idea on the head if I am missing something major, but a few things from just reading code wars that I noticed is:

- the afl has over 6 million fans across Australia
- the afl has over 1 million club members
- they only get a few hundred million from each 7 and foxtel each year, around 500 mill combined per year.
- fujak suggested the a league could start their own broadcasting due to not much interest.

The question I have out of this is, why is the afl not starting their own company to stream all their games for a subscription fee? Obviously they would still have the free-to-air deal with ch7 games, but then the subscribers money on top of this. When you look at how many people sign up to Kayo or Foxtel specifically just for AFL it could be a few million people per year at say $19 per month x 12. That would put it well over 500 million per year even before selling the fta rights to 7. Obviously they'd need to put aside 100 mill or something for production costs per year, but wouldn't they be making a whole lot load more this way?

* I forgot to add they would also get income through advertising being paid directly to the AFL for adds during games.

What do you reckon the capital costs are for outlying for all the cameras, servers, broadcast vans and equipment etc and then the ongoing recurrent costs every week to put it all together are?? What do they do with all this equipment for 6 months when there is no footy on, to get a return on your capital outlay.

Plus the majority of people don't watch footy on kayo.

You are only looking at revenue side, but there is a huge cost side you have ignored.

Specialization is the name of the game. That's why these guys below have all the sports broadcast equipment, camera guys, production guys in studios and access to 39 venues around Oz and just sell their services to 7, 9, 10 and Fox Sports etc, who say to the public they are producing the game when its really NEP doing most of the work.

NEP Australia - Behind Powerful Production

For more than 30 years we’ve been the broadcast industry’s first choice for project delivery. We offer complete end-to-end television production solutions.

www.nepgroup.com.au

Connected Production - NEP Australia

We offer IP-based multi-camera centralised production solutions around the globe that can help streamline the most complex productions.

www.nepgroup.com.au

 

[JohnZ]

Specialization is the name of the game. That's why these guys below have all the sports broadcast equipment, camera guys, production guys in studios and access to 39 venues around Oz and just sell their services to 7, 9, 10 and Fox Sports etc, who say to the public they are producing the game when its really NEP doing most of the work.

I think it would be fairly obvious to most people here that NEP would continue to do the grunt work of producing AFL content on gameday. No matter who/what holds the rights.

That's why it makes sense (to me) for one company to oversee production (be it AFL media or SEN for example) and then sell the finished product to the end user (FTA, Streaming etc). Production is already centralised for the most part, and this is just a natural evolution of the same thing.

Would make it easier to justify having commentators based in each state if they were guaranteed a game every week (rather than using a studio)