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Home / Sport / Rugby / All Blacks

Gregor Paul: The dark side of the All Blacks' financial awakening

Gregor Paul
By Gregor Paul
Rugby analyst·NZ Herald·
7 May, 2022 12:30 AM6 mins to read

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NZ Rugby boss Mark Robinson. Photo / Photosport

NZ Rugby boss Mark Robinson. Photo / Photosport

OPINION:

Almost 20 years ago, New Zealand lost its co-hosting rights to the 2003 World Cup.
It was in late April 2002 that World Rugby voted 16-5 to terminate New Zealand's role in the tournament and hand sole rights to Australia.

The journey from winning the co-hosting rights in early 1998 to losing them four years later was quite the saga, one which involved a little Australian chicanery, some World Rugby subterfuge, but most significantly a stubbornness and arrogance on the part of New Zealand Rugby who refused to allow their own provincial championship to be diminished or compromised by hosting the World Cup.

A few months after World Rugby delivered its devastating blow, former chief justice Eichelbaum produced a comprehensive review of the events which led to the hosting rights being lost and concluded that NZR had appeared commercially naive, underestimating the scale of the World Cup.

World Rugby had been given the impression that New Zealand saw their own provincial competition as being of equal stature to the global event and fundamentally lost confidence in the country's ability to host the tournament.

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In the 20 years since that debacle, NZR have lost their commercial naivety. Losing the hosting rights was a landmark event – one which saw a new breed of executive arrive at NZR with a brief to monetise and corporatise.

This financial awakening has seen the All Blacks repositioned as a corporate entity – viewed and managed internally as a big brand, where marketing strategies matter as much, if not more, than game plans.

Today's NZR executive and governance teams have full appreciation of the World Cup's commercial scale and indeed how the landscape has changed, turning rugby from sport to business almost overnight as global corporations queue up to plaster their logo on any bit of All Blacks kit they can find.

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But so too, in these last 20 years has there been a severe weakening of the provincial championship that the NZR board so fervently tried to protect back in 2002. Two decades of commercialisation has turned the All Blacks into a heavyweight global sporting brand, but it has come at a price: the community game has withered.

The All Blacks logo. Photo / Photosport
The All Blacks logo. Photo / Photosport

Provincial rugby has been the victim of the commercialisation programme and faith in trickle-down economics has been misplaced because the cash being generated by the All Blacks hasn't made its way to the grassroots.

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Not enough of it anyway. The professional machine has been thirsty and much of the money it generates ends up going back into its own engine.

The community game has lost its gravitational pull, possibly because too many pathways are set up to lead players to the riches that await at the highest levels of the sport.

Players in search of camaraderie - a memorable social experience wrapped around a bit of exercise - have drifted away. They play at school, reach their teens and then disappear.

Clubs that once thrived now often can't raise a senior team and administrators would be fooling no one if they claimed that rugby was still the chosen sport of young New Zealanders.

However naive the NZR board of 20 years ago may have been, there was at least a nobility, albeit misguided and poorly executed, about their desire to protect something they saw as precious to the future of the sport.

What makes this all so poignant and timely is that the game has another transformational opportunity sitting in front of it, one considerably bigger than World Cup hosting rights.

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It's expected that in the next week or so a date will be announced to hold a special general meeting, at which the country's provincial unions will vote on whether to accept a deal to sell an equity stake in NZR's commercial rights to US investor Silver Lake.

If they vote yes, $200m of capital will flood into NZR and a yet fiercer programme of commercialisation will begin.

The All Blacks will lose any pretence of being a rugby team. They will be a conglomerate of athletes empowered to build their personal brands.

TJ Perenara leads the All Blacks haka. Photo / Photosport
TJ Perenara leads the All Blacks haka. Photo / Photosport

Anything that can be sold will be sold and money will pour in, and the unions will, initially at least, get their share, as $50m of Silver Lake's cash will go to them.

But as the community game has not prospered despite the riches gathered these last two decades, provincial bosses must ask whether the longer-term consequence of a deal with Silver Lake will be to exacerbate the wealth division between the amateur and professional sides of the game.

Inequality will grow if the provinces take that money without also a significant change in mindset.

If the unions spend on elite players, talent identification programmes and continue to be held hostage by their ambition to win national championships ahead of growing participation numbers, the money will flow out as quick as it always has and there will be nothing to show for it.

What needs to be understood is that while the value of the provincial championship may have collapsed in the last 20 years, the importance of community rugby has soared.

The provincial unions haven't been relegated to an irrelevance, but they must accept that their new mission will be to run vibrant club competitions, grow participation, invest heavily in the women's game and embrace the wholesomeness of amateurism.

Their job is to provide rugby opportunities for those who know the professional game will never be for them, to enthuse volunteers and to make club rugby great again.

Super Rugby is the conduit to the international game now – the place where the next generation of All Blacks will be found, and the clock can't be wound back to the glory days of 35,000 people piling into Eden Park to watch Auckland play Canterbury.

What the provinces need to believe to vote yes is first a willingness to change and holster their professional ambitions, and then a conviction that Silver Lake will be an enabler of the community game: an agent of change that provides a sustainable future.

The provinces need not just a better and more reliable cash flow and less reliance on trust money, but a clearer operational remit, better ideas in engaging youth and cleaner pathways around talent identification and development.

Essentially provinces need to rediscover their place in the domestic set-up and understand their role as it pertains to the professional game.

Silver Lake's greatest contribution, should their proposal be approved, may not come in the form of investment, but in the art of persuasion.

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