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Media buyers have their say on historic AFL rights deal
After a blockbuster $4.5 billion deal was signed by the AFL, Seven and Foxtel, the rights for the nation's most popular sport are locked in for the next nine years. Following the deal, Australian media buyers have their say as the dust settles.
After a record $4.5 billion deal sealed between the AFL and existing broadcast partners yesterday, Mumbrella canvassed the thoughts of some Australian media agency buyers in order to get an early verdict on the long-term extension.
While both faced off competition from both broadcast and streaming rivals, ultimately the pair were “best on the day”, according to Seven’s James Warburton yesterday.
McLachlan, AFL chief executive at yesterday’s presser
Managing director of Speed, Ian Perrin says: “It retains the status quo, which is a good thing for both parties. There will be consistency in product, audience delivery and commercial returns which means everyone will be happy.”
For the fans, it is a different story though, he adds: “It is a less favourable outcome for the fans though as there is less likely to be a rethink in terms of how the programming can be developed in a really innovative way.”
The commitment for more Thursday night games is a good shake for fans, says national head of partnerships at Initiative, Simon Reid.
“The great news for Seven & Foxtel (and AFL fans for that matter) is the commitment from the AFL to schedule an increase in Thursday night games. Thursday nights traditionally pull in great audience numbers and the commitment to run at least 15 per season will no doubt boost average ratings across the season.”
Thursday night footy is a hit. And last week’s finals thriller proved that
Cassie Longmuir, business director at Half Dome agrees there are early signs of change across the broadcast schedule.
“The broadcasters need to focus on working together to keep pushing innovation in this space, which has already been flagged through the introduction of at least 15 Thursday night games each season and ‘Super Saturday’ following the model successfully implemented for the NRL competition.”
“With the considerable increase in the size of this deal, I would expect to see Foxtel and Kayo improve their product experience for the AFL viewers and advertisers.”
Awaken CEO, Chris Parker reckons the win will continue to benefit both Seven and Foxtel due to the “AFL halo” it provides, “by maintaining breakfast TV ratings through to increased streaming impressions”.
Initiative’s Simon Reid
“The passion for the game delivers eyeballs and drives attention all while allowing an expectantly higher rate card.”
For the winners:
It is a big plus for both winners in the deal, especially for Seven, which managed to tie up the digital rights this time around.
Reid adds: “Previously Foxtel held the exclusive digital rights and with shifting viewing habits, only airing games across linear broadcast in the future could be damaging so it was imperative that Seven secured digital rights as part of this deal. The data capture opportunity here is also huge and one that was missing from Sevens previous deal.”
Head of investment at Kaimera, Marianne Lane says Seven “knows firsthand the impact the absence of the AFL has on their schedule, ratings, and revenue as they experienced it from 2002-2006”.
Kaimera’s Lane
“There is no way they were going to let that happen again…at least for several years.”
“However, they can’t expect advertisers to pay more without receiving more. Other than guaranteeing ratings, more opportunities such as integration, data and access to players need to be established to make it more appealing. ”
Perrin adds the pressure will now be on to deliver sales revenue.
“With interest rates heating up and advertising budgets cooling off, the price is high. Only the analysts at Seven will know the exact details, but from our calculations, you would expect there to be significant pressure on the sales teams to deliver a positive outcome. Especially towards the back end of the deal.”
“Given their troubles with cricket, it ensures that Seven specifically have a proven ratings driver, which will help to promote other assets in their portfolio.”
Awaken’s Chris Parker
Parker also says that with a hefty price, it “sets a very high bar for rates that will need to earn back the investment from media planners and advertisers, not to mention the sponsorship and integration rates”.
“A really exciting part for advertisers is the greater targeting that we will be able to do over the next four years across streaming / BVOD. The third party integrations and data targeting is reducing media wastage and allowing brands to tap into the AFL for core segments. Hopefully, this will improve with better integrations to make it smarter and more accessible, also earning Seven/Foxtel a greater amount of revenue.”
What now for the losing parties?
Reid says: “Although Nine missed out, even with a sizeable bid of $500M per year, the biggest loser in this is clearly Paramount. They desperately need a marquee sporting code and Nine have already secured the NRL so Paramounts focus must swing towards Cricket and Tennis. Both summer sports so this won’t help them win the ratings war across the year, however both codes if executed correctly can be lucrative.”
Perrin adds further pain for Paramount: “While it puts some pressure on Nine as they have missed out, you have to feel the real loser is Ten / Paramount. At some point they need to find a consistent ratings vehicle to not only get viewers to their channels, but convince them to watch other shows in their line-up.”
Speed’s Ian Perrin
Longmuir says both Channel 9 and Channel 10 will need to continue pushing for other ways to grab eyeballs.
“Sport currently trumps the general entertainment sector, and without the AFL, Australia’s largest sporting code, they may struggle to compete on the longer-term advertiser TV deals.”
Parker says its only news, reality and sport that the local networks have to capture audience numbers, “and sports time after time delivers audiences in the lead-up, during and in the coverage after the game”.
“While this sets an incredibly high price, it also keeps our greatest sporting treasures local, and attainable, keeping the Australian networks relevant when the large streaming services are taking everything else.”
As noted in an analysis piece yesterday, the deal could have an impact on future sports rights, as attention will now switch to the summer codes.
“The relationship between Seven and CA has been turbulent and with their recent outlay for AFL, I wonder what Sevens tipping point will be for Cricket rights,” says Reid. “Expect this battle to be interesting.”
A big prize to fill the pockets of the AFL
A big win amongst all of this is the AFLW, which is set to see a bumper amount of games broadcast.
Half Dome’s Longmuir
“The new deal is also a monumental win for AFLW with 30+ matches to be broadcast live on Seven and every single match to be broadcast across Foxtel and Kayo with Seven holding the exclusive rights to the AFLW Finals and Grand Final,” says Reid. “The continued expansion of AFLW is now guaranteed and set up for success. I can only hope that this transfers to increased player payments.”
Longmuir adds the landmark deal will set the AFL up for recovery and growth post-pandemic, and will aid the expansion of the AFLW, as well as the chances of a team being established across the Bass Strait.
“With the expected increase in viewership numbers brought to life through the ramp-up of the AFLW, the AFL’s committed focus on grassroots across the NSW and Queensland states, plus the post-pandemic love for sport, it is not surprising to me that the price tag is as large as this.”
“Yes it’s a huge sum of money for broadcasters to pay,” finishes Reid, “however as we know, live sport can prop up a network providing sustained, captive and guaranteed audiences across the year.”
Calum Jaspan was news editor at Mumbrella, based in Melbourne. He was also the producer and host of the Mumbrellacast. He left Mumbrella in May 2023.
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topics
AFLAwakenCassie Longmuirchris parkerFoxtelHalf DomeIan PerrinInitiativeKaimeraMarianne LaneSevenSeven NetworkSimon Reidspeed
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