Play Nice 2018 Non AFL Admin, Crowds, Ratings, Participation etc thread

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AFR Max Mason 13.5.19

"Foxtel is looking to cut costs amid pressure on profits...Newscorp said there was an opportunity to 'reduce spend on non-marquee sporting content', but did not define which sports that related to".

The signs are ominous for sports such as soccer & RU- it is probable there will be a significant reduction in their next Foxtel broadcast $ Rights.

https://www.afr.com/business/media-...t-sport-and-programming-costs-20190513-p51mp2

SMH 13.5.19

Foxtel lost $417,000,000 in 2018.
Even the AFL and NRL could be under threat if Foxtell keep running at a massive loss.
It is a failed business model and has to have paid ads to prop it up and it dosent look like they can generate any new subcsribers no matter what they do.
Apparently Netfix and Stan are really hurting them.
 

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rfctiger74

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Even the AFL and NRL could be under threat if Foxtell keep running at a massive loss.
It is a failed business model and has to have paid ads to prop it up and it dosent look like they can generate any new subcsribers no matter what they do.
Apparently Netfix and Stan are really hurting them.
Yep. Report in weekend rags that News is doing a mulit billion dollar equity injection, and Telstra has refused to match. They want out, and for an IPO to be run to let them walk.

Streaming is the model people now prefer because it isn't tied to one screen and a set top box, and you don't have to buy 30 channels of **** you don't want.

With Foxtel subscribers falling, and streaming on the rise, question for me is will the set top box still be a thing in 2025?
 

deck

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Yep. Report in weekend rags that News is doing a mulit billion dollar equity injection, and Telstra has refused to match. They want out, and for an IPO to be run to let them walk.

Streaming is the model people now prefer because it isn't tied to one screen and a set top box, and you don't have to buy 30 channels of **** you don't want.

With Foxtel subscribers falling, and streaming on the rise, question for me is will the set top box still be a thing in 2025?
The issue is the Netflix model is still very different to the sports model. As it stands most sports streaming services have get there content from local broadcasters. Very few if any are producing there own content. Even Netflix have had to up prices to cover costs of there own produced shows.

It's only early in the streaming era and platforms have had to offer cheap services to move people away from cable tv. The question is how long is this sustainable for them. Content cost money no matter who delivers the product. Everyone believes streaming will be substantially cheaper than the cable model but reality suggests it may not be long term.
 

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The issue is the Netflix model is still very different to the sports model. As it stands most sports streaming services have get there content from local broadcasters. Very few if any are producing there own content. Even Netflix have had to up prices to cover costs of there own produced shows.

It's only early in the streaming era and platforms have had to offer cheap services to move people away from cable tv. The question is how long is this sustainable for them. Content cost money no matter who delivers the product. Everyone believes streaming will be substantially cheaper than the cable model but reality suggests it may not be long term.
Report in the SMH suggested one Foxtel customer is worth as much as 5 Kayo subscribers. So if people switch to streaming wholesale, at the price they will be willing to pay for streaming, something has to give. Either sports accept a lot less money, or the cost of streaming is going to have to rise.

This will be markedly compounded if the sports market fragments on streaming services, which is almost certain. Kayo is attractive because it has lots of sports, but if it starts to lose them to different competitors? How many subscriptions is the average person willing to pay for?

Pirating was on the decrease, but is now rising again, for this very reason. There is so much good content locked up with exclusive deals. Most people are not going to pay for 4 or 5 subscriptions, if there are only 1 or 2 shows per subscription they are really interested in.
 

rfctiger74

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The issue is the Netflix model is still very different to the sports model. As it stands most sports streaming services have get there content from local broadcasters. Very few if any are producing there own content. Even Netflix have had to up prices to cover costs of there own produced shows.

It's only early in the streaming era and platforms have had to offer cheap services to move people away from cable tv. The question is how long is this sustainable for them. Content cost money no matter who delivers the product. Everyone believes streaming will be substantially cheaper than the cable model but reality suggests it may not be long term.

The issue is the Netflix model is still very different to the sports model. As it stands most sports streaming services have get there content from local broadcasters. Very few if any are producing there own content. Even Netflix have had to up prices to cover costs of there own produced shows.

It's only early in the streaming era and platforms have had to offer cheap services to move people away from cable tv. The question is how long is this sustainable for them. Content cost money no matter who delivers the product. Everyone believes streaming will be substantially cheaper than the cable model but reality suggests it may not be long term.
Don't disagree, which is why I think sports will start looking at less coin for these deals. The value as a loss leader for other shows isn't what it was 10 years ago
 

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Don't disagree, which is why I think sports will start looking at less coin for these deals. The value as a loss leader for other shows isn't what it was 10 years ago
The AFL are already getting less coin in the current deal from 7. All the extra money came via Foxtel and all 7 had to give up was 1/2 a game. I'm not sure the AFL will walk into the next deal and except not to get at least a inflation increase on what they're getting now.
 

rfctiger74

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The AFL are already getting less coin in the current deal from 7. All the extra money came via Foxtel and all 7 had to give up was 1/2 a game. I'm not sure the AFL will walk into the next deal and except not to get at least a inflation increase on what they're getting now.
I agree that's what they will be expecting, but if Foxtel keeps bleeding subscribers and free to air advertising in general softens, where is the coin coming from?
 

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jatz14

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I agree that's what they will be expecting, but if Foxtel keeps bleeding subscribers and free to air advertising in general softens, where is the coin coming from?
the advantage the AFL will have in the coming era of streaming is, its a marque sport. People will not pay for a streaming service that just offers heaps of second tier sports. A service wanting to break through needs a tier 1 sport, or it will remain a minor player. Its the second tier sports that will really bleed. That said, I think the AFL will do well to hold on to the revenue it has, and increases of the size seen previously are a thing of the past.
 

rfctiger74

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the advantage the AFL will have in the coming era of streaming is, its a marque sport. People will not pay for a streaming service that just offers heaps of second tier sports. A service wanting to break through needs a tier 1 sport, or it will remain a minor player. Its the second tier sports that will really bleed. That said, I think the AFL will do well to hold on to the revenue it has, and increases of the size seen previously are a thing of the past.
We are back to the earlier point though, people will not pay as much for streaming as they do for Foxtel. If they start charging $70 a month for kayo, you think the subscriber numbers will keep rising?
 
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We are back to the earlier point though, people will not pay as much for streaming as they do for Foxtel. If they start charging $70 a month for kayo, you think the subscriber numbers will keep rising?
Yep but Foxtel is bleeding subscribers already and are currently running a massive loss so something has to give or they go under and it looks like Telstra are a wake up and dont want to waste money on propping outmoded Foxtel up.
 
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I agree that's what they will be expecting, but if Foxtel keeps bleeding subscribers and free to air advertising in general softens, where is the coin coming from?
I think Telstra is the key. They have revenue of near $30billion so an extra $1billion (very much the high side) in costs PA to get full rights to AFL, NRL and even EPL ect isn’t out of the question. They could absorb the cost a lot better than anyone else considering they have close to 14 million customers and an extra $10 a month per customer is probably all that it would cost to cover it. They may lose some customers from a price rise if they don’t like soccer, football or League but they gain what they lose from Optus you would think. Plus advertising ect ect would help cover broadcasting costs
 

jatz14

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We are back to the earlier point though, people will not pay as much for streaming as they do for Foxtel. If they start charging $70 a month for kayo, you think the subscriber numbers will keep rising?
I dont think they can charge $70 for Kayo, but I dont think Kayo can keep all its sports either. Foxtel, with the sports, may be costing $70 a month, but how much of that $70 is going to the AFL, not a lot I think.

If AFL ends up on a platform charging $25 a month, but its the sport getting the bulk of the payment, then they are probably not a lot worse off.

Its the smaller sports that face minimal payments, or doing it themselves via Facebook or YouTube streams that will have the real issue.
 

rfctiger74

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I think Telstra is the key. They have revenue of near $30billion so an extra $1billion (very much the high side) in costs PA to get full rights to AFL, NRL and even EPL ect isn’t out of the question. They could absorb the cost a lot better than anyone else considering they have close to 14 million customers and an extra $10 a month per customer is probably all that it would cost to cover it. They may lose some customers from a price rise if they don’t like soccer, football or League but they gain what they lose from Optus you would think. Plus advertising ect ect would help cover broadcasting costs
Why would they wear the loss?

They already give this content for free, so you are saying they charge more for exactly what they offer today (for AFL and NRL)
 

rfctiger74

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I dont think they can charge $70 for Kayo, but I dont think Kayo can keep all its sports either. Foxtel, with the sports, may be costing $70 a month, but how much of that $70 is going to the AFL, not a lot I think.

If AFL ends up on a platform charging $25 a month, but its the sport getting the bulk of the payment, then they are probably not a lot worse off.

Its the smaller sports that face minimal payments, or doing it themselves via Facebook or YouTube streams that will have the real issue.
Afl wanted to do that previously, but walked away because they don't want to take on subscriber risk. They would rather get a cheque and let a third party wear the risk of falling subscribers.

Also to cover less than half for the current deal, the AFL would need 666,666 subscribers rusted on for a full twelve months. Kayo is here with a full suite of sports. How do the AFL increase this further with only one sport, and SFA on for 3-4 months of the year
 
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Why would they wear the loss?

They already give this content for free, so you are saying they charge more for exactly what they offer today (for AFL and NRL)
So my non factual and with made up numbers answer would be

Say if Optus and Telstra can both provide the same mobile/internet service for say $75 a month. With Telstras huge customer base they could realistically put their price up to $90 and bring in something like an extra $1.5billion PA if they have ten million customers. (They have something like 14 million mobile customers already. Not sure how many plans) they also have options of approaching someone like Netflix. If they have say a current revenue of $100mil than maybe Telstra offer them $150mil for exclusive rights to their content. It could pretty much kill their opposition. With such a huge customer base they don’t need to charge huge amounts ($.50 a day) to cover the costs and it is easy to hide from them considering they need a phone and the internet, compare that to Foxtel
 

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I sort of get what you're saying, if the desire is merely to maintain, and possibly have small growth, to an existing large customer base, and existing revenues, it might be worth buying AFL content at a premium price.

Just doing some basic maths, at an additional charge to customers of $120 per annum (similar to the Netflix charge of $10 per month), those customers taking up the option of having access to the AFL (if that's the model), would only generate $120 mill per annum if one million customers take up the option.

It might be worthwhile for Telstra to pay double the money it brings in to lock in those one million customers long term, but even in that best case scenario, the AFL is only getting $240 million per annum. For a whiile, you'd be able to add whatever FTA brings to the table, which we know will not grow from where it is now, and steadily decline before it disappears altogether.

Those rough and ready numbers merely show how hard it will be to make up the traditional broadcast revenue in the 100% streaming world.

The large international social media players, to date, have shown zero willingness to pay big dollars for sport. And why should they, their thing is to have people talk about and share sports talk, without them having to pay a cent for it.
 
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I sort of get what you're saying, if the desire is merely to maintain, and possibly have small growth, to an existing large customer base, and existing revenues, it might be worth buying AFL content at a premium price.

Just doing some basic maths, at an additional charge to customers of $120 per annum (similar to the Netflix charge of $10 per month), those customers taking up the option of having access to the AFL (if that's the model), would only generate $120 mill per annum if one million customers take up the option.

It might be worthwhile for Telstra to pay double the money it brings in to lock in those one million customers long term, but even in that best case scenario, the AFL is only getting $240 million per annum. For a whiile, you'd be able to add whatever FTA brings to the table, which we know will not grow from where it is now, and steadily decline before it disappears altogether.

Those rough and ready numbers merely show how hard it will be to make up the traditional broadcast revenue in the 100% streaming world.

The large international social media players, to date, have shown zero willingness to pay big dollars for sport. And why should they, their thing is to have people talk about and share sports talk, without them having to pay a cent for it.
I don’t think they would give the customer the option to pick and choose. I think they would just say for eg pay $90 for Telstra and get your phone, sport (AFL, NRL and EPL. Possibly other sports like NBA or cricket where they have no extra broadcasting costs) and a movie/tv program streaming channel. Or pay say $75 for Optus just for your phone service.
That extra $15 per month people wouldn’t even notice and the beauty of it for them is a household of say 4 ppl could be paying $60 between them (nearly the same as Foxtel) for a lesser service without people even thinking about it because it’s being split up. A very good movie channel is extremely important though considering half the population is female.
Financially it may only be a break even result for Telstra but it’s more about beating the opposition to it because that could be disastrous for them
 

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I don’t think they would give the customer the option to pick and choose. I think they would just say for eg pay $90 for Telstra and get your phone, sport (AFL, NRL and EPL. Possibly other sports like NBA or cricket where they have no extra broadcasting costs) and a movie/tv program streaming channel. Or pay say $75 for Optus just for your phone service.
That extra $15 per month people wouldn’t even notice and the beauty of it for them is a household of say 4 ppl could be paying $60 between them (nearly the same as Foxtel) for a lesser service without people even thinking about it because it’s being split up. A very good movie channel is extremely important though considering half the population is female.
Financially it may only be a break even result for Telstra but it’s more about beating the opposition to it because that could be disastrous for them
I doubt that will happen. Telstra is already seen as somewhat expensive. While AFL is popular, it is still only a fifth or so of the population that watch it to any extent. A large proportion of people have no real interest in sport full stop. Will these people be happy at their phone bill going up by $15 a month, specifically so they can access something they have no interest in?

Personally, my phone company says, bills are going up $15, but great news, you now get soccer, I am looking for a new phone company.

If Telstra hike prices for AFL and NRL, I think they will lose more customers than they gain.
 
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I doubt that will happen. Telstra is already seen as somewhat expensive. While AFL is popular, it is still only a fifth or so of the population that watch it to any extent. A large proportion of people have no real interest in sport full stop. Will these people be happy at their phone bill going up by $15 a month, specifically so they can access something they have no interest in?

Personally, my phone company says, bills are going up $15, but great news, you now get soccer, I am looking for a new phone company.

If Telstra hike prices for AFL and NRL, I think they will lose more customers than they gain.
It’s very possible and that’s why they would need an extremely good version of Netflix to go with it.
I think $15 a week won’t make much difference to people when it’s hidden in a phone/internet bill. Even $10 would probably cover it.
The worry for Telstra is they could possibly lose millions of customers if Optus beat them to it. It would be billions in lost revenue. I think the real key is the female customer though.
 

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So my non factual and with made up numbers answer would be

Say if Optus and Telstra can both provide the same mobile/internet service for say $75 a month. With Telstras huge customer base they could realistically put their price up to $90 and bring in something like an extra $1.5billion PA if they have ten million customers. (They have something like 14 million mobile customers already. Not sure how many plans) they also have options of approaching someone like Netflix. If they have say a current revenue of $100mil than maybe Telstra offer them $150mil for exclusive rights to their content. It could pretty much kill their opposition. With such a huge customer base they don’t need to charge huge amounts ($.50 a day) to cover the costs and it is easy to hide from them considering they need a phone and the internet, compare that to Foxtel
Current deal is $2.5b over 6 years (off mem)

Your $150m pa is less than a third of this. Where is the rest of the money coming from if telstra has digital exclusivity, and Foxtel budgets are being slashed?
 
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