Source :- THE AGE NEWS
In the latest Rugby Australia annual report, Rugby Australia chief executive Phil Waugh trumpets the fact they have secured an increase of about 40 per cent in the new broadcast deal with Nine, the publisher of this masthead, making it valued at up to $240 million.
It’s easy to strip about $50 million out of that figure, however. The free advertising component of the deal amounts to about $30 million over five years, reducing the cash amount to $210 million, and subtract a further $25 million if the Wallabies and the Super Rugby sides don’t meet certain performance criteria.
In other words, the $240 million deal “value” is actually $185 million in real terms, with the potential of rising to $210 million if Australian rugby shoots the lights out over the next five-year period.
That is a far different figure to the one presented – far more sobering – but it is actually a far more helpful one for Australian rugby fans trying to make sense of the seemingly contradictory signals that keep emerging.
On the one hand, the apparent effect of cost controls is evident in the departures of players such Noah Lolesio, an extraordinary example of an incumbent Test No.10 heading overseas and putting his participation in a British and Irish Lions series and a home Rugby World Cup at risk.
On the other, there is talk of a $50 million surplus next year and a prompt repayment of RA’s debt, the bumper new broadcast deal as mentioned above and a $100 million Rugby World Cup windfall in 2027 that would set the game up.
Len Ikitau scores a try against Wales in November 2024.Credit: Getty Images
Those two narratives don’t add up, and perhaps RA has been a little too successful in selling the bullish outlook for the game, encouraging the Queensland Rugby Union to hold out for compensation for Wallabies coach-in-waiting Les Kiss.
But the reality is that Lolesio’s exit is a sign that RA is involved in an ongoing struggle to live within its means on the back of a $36.8 million deficit in 2024.
Clearly, every retention decision is being made with a hard-nosed attitude towards a player’s worth and the depth in his position, and the flexibility being shown to Len Ikitau, who will spend some time with Exeter before returning to Australia ahead of the Rugby World Cup, is a reflection of the latter.
The absorption of the Waratahs and the Brumbies into RA also clouds the longer-term picture. While RA was keen to point out the “one-off costs” involved in bringing them under the RA umbrella, it remains to be seen whether they’ll be a persistent cost burden.
Drua players perform a Cibi before kick-off against the Waratahs in February.Credit: Getty Images
Who makes money in Super Rugby? The Reds, the Drua (with healthy support from DFAT, NZ Rugby and World Rugby) and whoever hosts the final, which was the Blues last year.
Apart from that, it’s a yearly challenge for the clubs to wash their faces – the Hurricanes have lost $NZ2.1 million ($1.97 million) in the past two years, so it’s possible that the Waratahs and the Brumbies will weigh heavily on RA’s bottom line in the coming years.
The solution to this is as elusive as it is simple. In its annual report, RA reveals that Stan audiences for the Wallabies’ end-of-season tour last year had jumped 40 per cent, a marked contrast to the 9 per cent decrease in the free-to-air audience for Super Rugby Pacific.
Joseph Aukuso-Sua’ali’i can take some of the credit for this, but the figure also points to the vast pent-up demand that exists for a winning Wallabies side.
To that end, RA should be grateful to an admirable group of players who have stayed loyal to Australian rugby, clearly aware of the extraordinary privilege of being able to host the British and Irish Lions and to play in a World Cup in front of friends and family.
Harry Wilson set the tone earlier this year, almost taking umbrage at questions about why he didn’t want to go overseas. Rob Valetini, Fraser McReight and Ikitau have espoused similar sentiments, while Nic White has been consistently vocal in recent years about his desire to push through to the Lions.
But they all also carry the enormous responsibility of making the Wallabies successful again, an outcome that is not only desirable but explicitly linked to the financial well-being of the game.
The new broadcast deal and the pending Lions millions are of course good news, particularly alongside an encouraging Super Rugby campaign to date. But it’s hard to see Australian rugby getting off the financial tightrope any time soon.
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