On the face of it, Sky and New Zealand Rugby (NZR) are partners – united by a bindinglegal agreement for the former to own the media rights to the latter’s content.
And for the last 28 years, they have also been united by a mutual understanding they need each other to survive.
But perhaps now, in an ever-changing media landscape and with NZR increasingly convinced the key to financial sustainability lies in foreign markets, both parties are no longer sure they need each other quite as much as they once did.
They may be partners by contract, but in practice there is reason to wonder if they see themselves more as competitors, now locked in a mad war to control content creation and distribution.
The two behemoths of the rugby landscape do not appear to be aligned on how best to grow interest in the game and put the consumer ahead of their respective needs to feel like the dominant partner in the content arena.
The All Blacks’ end-of-year tour perfectly illustrates how both have lost sight of their core purpose and key strengths.
Sky, having spent $100m a year to buy the rights to NZR’s broadcast portfolio, is not sending its own commentary team to either Japan or Europe – just as it didn’t send a team to South Africa or San Diego for tests earlier in the year.
Instead, it’s sending a sole camera operator to capture behind-the-scenes footage, pre-game, halftime and post-game interviews that will come from analysts Justin Marshall, John Kirwan and Taylah Johnson, all of whom will be in Europe on other business.
No matter how hard Sky tries to spin this, it can’t hide the three realities driving this decision.
Former Blues coach Leon MacDonald is interviewed by Karl Te Nana of Sky Sports. Photo / Andrew Cornaga / www.photosport.nz
Sky overpaid to buy the rights back in 2019 when it feared losing the contract to Spark Sport, and now that it once again has no viable competitor, it appears to be focused on finding ways to cut production costs in a manner which it feels the viewers won’t notice.
Why invest in the full platinum-level production package while it enjoys a monopoly?
It’s possible, probable even, that Sky’s executive team view it as a consequence-free decision to skimp a little by having commentators working out of a cupboard in Mt Wellington – giving the illusion they are on the ground without incurring the costs of having them in situ.
They also believe it’s a major victory for the consumer that Sky has access to its talent in Europe who will be furnishing interviews, analysis and other content for the wider suite of programmes such as The Breakdown, Rugby Nation, the Aotearoa Rugby Pod and The Crowd Goes Wild.
But this is not the victory it seems, as no one subscribes to Sky for these programmes.
The investment subscribers make is exclusively to watch live content and for many, that will be yet more specific – to watch All Blacks tests.
Sky has never been able to hold and engage its audience outside of live broadcasts, but with commentators of the calibre of Tony Johnson and Grant Nisbett, and the sharp analysis of Marshall, who remains – despite not being everyone’s cup of tea – the most astute and engaging second voice, the business model has worked.
Sky doesn’t need to be a broad content church appealing to everyone – just a world-class live broadcaster that delivers the big games in such a way as to leave the audience satisfied their investment is being well-spent.
For Sky to therefore promote its ability to provide non-live content from Europe suggests its leadership may have lost sight of what it needs to be good at and what its audience wants.
Were its subscribers to be given the choice, they would rather see a heavy investment in match-day production, and this desire to get in behind the scenes with the All Blacks alludes to not just a fundamental misreading of what its core priorities should be, but also hints at the wider tension that exists in its relationship with NZR.
Here’s Sky, investing $100m a year in NZR, trying to negotiate for its one camera in Europe to get inside access to the All Blacks; all the while, NZR is using some of that investment to fund several of its own camera operators to be inside the All Blacks’ inner sanctum for its own channel, NZR+.
NZR is on a mission to capture content from inside the All Blacks, but its efforts to date to manifest this into watchable, well-considered storytelling have so far failed to win the audience the investment required.
What makes the picture yet more topsy-turvy is that NZR+ is also going to be a live broadcast platform for All Blacks XV games in November, suggesting the combination of the digital age and the arrival of Silver Lake as an equity partner in professional rugby has created a new world where neither national body nor Sky have any concept of staying in their respective lanes anymore.
Sky TV chief executive Sophie Moloney. Photo / Alex Burton
Possibly, neither even knows in what lane they need to be, as both parties are spending enormous sums to have an ill-defined partnership where they compete more than they co-operate.
It’s a situation in which there are no winners – but one absolute loser, which is the rugby fan in this country, who is not being served with compelling long-form or even short-form content, and is now also having the one thing they could always rely upon – the quality of the live experience – eroded.
And ultimately, what’s truly driving this mad war to be crowned “content king of New Zealand” is the negotiation to renew the existing broadcast contract.
Talks are thought to be gathering pace, although an agreement is said to still be some way off completion.
Contractually, Sky has an exclusive window in which to agree terms – believed to close at the end of this month – but with no other serious domestic player remotely capable of competing, this is a negotiation that will simply take as long as it takes to reach an agreement.
Chief executive Sophie Moloney has spent the last six months messaging that Sky won’t, or maybe can’t, match the $100m a year it currently pays.
Some sources say Sky won’t pay more than $60m a year, others say they won’t go past $80m – but the signalling has left no doubt the cheque will be considerably smaller.
Craig Fenton, chief executive of New Zealand Rugby Commercial – the company set up to house all the game’s revenue generating assets – has hinted the bigger focus is driving a major uplift in the value paid by overseas broadcasters to buy rights to the All Blacks.
That’s his way of reminding Sky NZR’s ambition is such that in time, it hopes the domestic broadcast rights will form only a small percentage of overall revenue.
But it’s the very fact that NZR’s partnership with Sky is defined and measured purely by the price paid which is the biggest problem, as it has created a barrier to the two parties ever getting beyond being in a transactional relationship.
It’s such a low-trust environment that neither is willing to concede their respective ambitions to grow would be better served by a better-defined partnership that ensures the consumer is not a pawn in a pointless war.
