Foxtel lobs aggressive bid to grab cricket for pay TV
Pay TV could be the financial lifeline Cricket Australia has been hoping for amid speculation Foxtel has lobbed a bid for the rights to broadcast every ball bowled from 2019.
Sources close to the discussions believe that Foxtel, which is controlled by News Corp, has made a hefty offer that would see Fox Sports given the right to show all the Test matches, one-day internationals and Twenty20 games.
Foxtel has made an aggressive offer to make pay TV the new home of cricket.
Photo: APFree-to-air television networks would likely be given the option to broadcast test matches in simulcast in a deal with Foxtel, but under the condition that a good portion of Twenty20 and one-day games would be kept for pay TV alone.
While this deal may form the basis of a starting point for future negotiations, it does signal how aggressive Foxtel is willing to be for exclusive sports content. The proposal in its current form could cause tensions with anti-siphoning rules, which encourage certain sporting events to be shown on free-to-air television.
Foxtel is believed to have made an offer in the range of $160 million to $170 million a year to Cricket Australia to get rights to every game.
Cricket Australia has been looking for a bid of around $850 million and above for its five-year rights to 2023, compared to about $500 million for its expiring rights deal.
Foxtel CEO Patrick Delany.
Photo: suppliedThe rights deal has typically made up about 60 per cent to 80 per cent of Cricket Australia’s total annual income and is used to pay players, fund junior programs and cover administration costs.
Foxtel’s total offer, of $800 million to $850 million, is a clear contender as the pay TV network tries to increase its exclusive sports content to attract and retain subscribers.
Free-to-air bids have likely been closer to $600 million, and Cricket Australia has been unhappy with the approach from the networks with rivals Nine Entertainment and Ten Network putting in a joint bid to keep the price down. Seven West Media recently resubmitted its bid.
While the deal is attractive financially, if accepted in its current form it could have an impact on the visibility of the sport, marking a major move away from cricket's traditional home on free-to-air.
This could threaten the associated sponsorships and ticket sales that come with reaching a bigger audience through a broadcaster like Nine, Seven West Media or Ten.
Cricket Australia would likely be willing to accept a lower price from the free-to-air networks to ensure it maintains its reach and relevance, however there’s no telling how much less it is prepared to take.
Anti-siphoning questions
Accepting a Foxtel bid could also leave the sport in a difficult position with Australia's anti-siphoning laws, which aim to ensure Australian viewers have free access to major games. Twenty20 and one-day matches played in Australia with a senior Australian representative team are on the anti-siphoning list.
There are exceptions, which include allowing pay TV to buy the rights if national or commercial broadcasters haven't obtained them 26 weeks before the start of an event, but making these sports paid-only does go against the intentions behind the rules in the first place.
An event is removed from the anti-siphoning list if no one has bought the rights 12 weeks before it starts.
Communications Minister Mitch Fifield told Fairfax Media at the beginning of the negotiations that all parties were expected to comply with the anti-siphoning scheme.
“Whilst the anti-siphoning scheme has never prevented a listed event from being shown exclusively on pay TV, and the government has no role in the allocation of sports broadcast rights, the government’s view nonetheless is that test matches played in Australia should be available to the public on free-to-air television,” he said.
A Cricket Australia spokesman said the sporting body was "currently undergoing a confidential process, and when we have finalised our rights, we will look to make an announcement on this". Foxtel declined to comment.