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Home / Sport

Gregor Paul: We're moving dangerously close to Super Rugby's collapse

Gregor Paul
By Gregor Paul
Rugby analyst·NZ Herald·
10 Dec, 2019 01:37 AM4 mins to read

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The Black Caps are acclimatising to the heat in Perth ahead of the first test on Thursday.

The sun's beating down, the sound of leather hitting willow is reverberating around the country and beaches are starting to fill with sun-seeking students who have knocked off for the summer.

Yet rugby continues to dominate the wider sporting agenda, because a little like New York, it has become the code that never sleeps.

Part of the reason it never sleeps is that it never really stops. Super Rugby 2020 will kick off before most schools have re-opened.

The last week of January will see the action begin: that's action proper, not trial games.

There will be time enough to wolf the turkey down have a quick dip in the sea and get back into it.

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But the other reason rugby never sleeps is that there is a lot of worrying stuff keeping it awake.

Super Rugby kicks off in seven weeks and will do so with a number of serious problems in urgent need of being solved.

The big one is the broadcast situation in Australia. Now that they have the Israel Folau saga out of the way across the Tasman, the next ice-berg has rushed upon them.

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Israel Folau. Photosport.co.nz
Israel Folau. Photosport.co.nz

And it is big. Bigger than Folau because it was always a touch fanciful that the legal business with him would bring Australian Rugby to its knees financially.

But as Australia's Super Rugby clubs have made clear in the last week, they will be facing financial ruin if there is a significant drop in broadcast income from 2021.

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That's not a maybe. That's a fact.

The stakes have been raised and the Australian Rugby Union has to find a way in the next six-to-eight months to negotiate a broadcast deal that at least preserves the current almost $60m a year they receive from Fox Sports.

We live in unprecedented viewing times with the scramble for content more intense and urgent than it has ever been.

There are also more potential bidders than there have ever been and with live sport seen as premium value given its exclusive nature, it would seem that Australia Rugby should be optimistic about its prospects.

What should also help them feel confident is that in October, New Zealand Rugby negotiated what is believed to be an uplift in their deal with Sky for the 2021-2025 cycle.

But Australia Rugby has taken what many believe to be an extraordinary risk by choosing to go to the open market rather than work with existing rights holder Fox to secure a contract beyond this year.

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That move is believed to have angered Fox and the risk for Australia Rugby is that if they don't induce an attractive offer from the open market, they won't have the relationship or goodwill in the bank with Fox to go back to them and secure the sort of deal they need.

They will get a deal, that much is certain. But they are in the precarious position of knowing that not any deal will do.

There is a compounding problem, which is that the format for Super Rugby is changing in 2021 and the shift to a straight round-robin will see the Australian sides play fewer home games.

If there is a drop in gate revenue and broadcast income, Australia's Super Rugby sides are not sugar-coating the truth and are quite openly stating they will go bust.

They are already barely making ends meet and the revamped 2021 Super Rugby schedule will deny their four sides of about 20 per cent of their current income due to lost gate receipts.

If they collectively suffer a drop in broadcast income as well, they simply won't survive.

The prospect of insolvency will hang over Australian rugby until or unless there is a major broadcast deal signed, while in South Africa there is no end to the player exodus which is weakening their Super Rugby sides at an alarming rate.

New Zealand, by comparison, is weathering the various storms and has money in the bank, a new, improved broadcast deal starting in 2021 and is just, through overly generous sabbatical options, hanging on to its best players.

Scott Robertson during Crusaders training at Rugby Park, Christchurch, New Zealand, 24th April 2019. Photo / Photosport.co.nz
Scott Robertson during Crusaders training at Rugby Park, Christchurch, New Zealand, 24th April 2019. Photo / Photosport.co.nz

But their comparative strength only exacerbates the weakness of Australia and South Africa and creates a greater divide between the haves and have nots.

They can't be smug or content because it feels like seven weeks out from the next Super Rugby competition starting that we are moving dangerously close to some kind of collapse.

It is, then, true that Australian Rugby must strike a TV deal not just to protect itself, but to preserve the whole future of Super Rugby.

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