Nine downplays Cricket Australia court action as Ten makes ‘$500m’ bid
Channel Nine has downplayed court action by Cricket Australia against the TV network in the Supreme Court of Victoria, in a move that could signal the sport is looking to move domestic cricket to Channel Ten.
While the exact nature of the court action is confidential, sources have told Mumbrella the writ seeks to examine whether Channel Nine’s last rights contract, which gives the network the ability to see and match a rival’s bid, extends to domestic cricket and in particular the Big Bash league which was launched since the contract began.
Channel Nine managing director Jeff Browne would not be drawn on the details of the court action but told Mumbrella: “We have a 32 year relationship with Cricket Australia and I’m very confident that we will be able to resolve any issues between us sensibly and through direct discussion.”
The move comes as The Australian Financial Review reports that Channel Ten has made a $500m play for the cricket rights over five years, a price that is largely seen as unprofitable given the sport only generates around $60m per year in advertising revenue.
“I’m not able to comment on that as there are some strict confidentially regimes in place (around the negotiations,)” said Browne.
Cricket Australia would not comment on the reasons for the court action or the ongoing negotiations however, sources at Channel Nine have told Mumbrella the network is very disappointed with the court action.
According to The Sydney Morning Herald, the court action comes days after Channel Ten’s exclusive negotiating period concluded last week.
The reported $500 million sports rights bid has surprised media buyers with one media buyer, who wished to remain anonymous, telling Mumbrella: “It’s an awfully large amount of money for a sport that isn’t actually in the ratings period.”
Media agency UM CEO Mat Baxter told Mumbrella the cost of the bid was a matter for Ten but said the strategy behind the bid was clear.
“The strategy behind making an aggressive bid and a large bid is due to strategic importance that having a major sport on the network will play and the knock-on effect or the positivity that that can have on the wider schedule for building audience. It won’t be being viewed through just the lens of how much money they can write in cricket revenue,” said Baxter.
“It will be about what sort of contribution cricket can have as an asset to the wider programming strategy and the wider growth of audience across the network.”
Media analyst Steve Allen said that with the negotiations ongoing it was necessary to be cautious about strategic leaks such as the reports of Ten’s $500m bid.
However, the Fusion Media analyst also said that such a price tag would not be profitable for either Channel Nine or Ten.
“I don’t think either Nine or Ten can make money from it at that price. Nine is in a better position to make money from it and that’s not to discredit the Ten sales team but Nine has a very long history with the cricket and its been a premium product for them for 20 years,” said Allen.
“If Ten gets the rights they are going to have to build it from the ground up, Nine are not going to help Ten whatsoever and most of the media buyers and sponsors aren’t going to give Ten an easy time and therefore some of the premium is going to disappear if it does change telecasters.”
Nic Christensen
Wow, so Gyngell has been criticised for crippling Nine with the 500 mil WB deal. Ten have offered the same for a sport that airs in the non ratings period.
At least WB provides content throughout the year (some of it rates close to a mil per ep – higher than the average audience for the cricket over the recent summer).
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