Cricket Australia’s attempts to do broadcast deal before Christmas sends media executives into chaos

Cricket Australia’s attempts to secure a new broadcast deal before Christmas have unleashed a chaotic speed dating frenzy among current and potential broadcast partners, with a range of negotiations between rival broadcasters about the best way to secure a deal.

Network 10 owner Paramount has offered the largest sum of money to the sporting body to secure a long-term deal, around $1.5 billion, but has been unable to secure the rights because of CA’s reluctance to leave long-term partner Foxtel, which is owned by News Corp.

Seven West Media has now reached out to Paramount to discuss the prospect of sharing Test matches after revelations in News Corp’s mastheads that Foxtel executives had tried to approach Nine Entertainment Co, the owner of this masthead, about a similar arrangement.

CA’s attempts to secure a bid have sent the television and streaming networks into chaos.Credit:AP

Paramount remains concerned about the additional production expense, which is about $40 million per year, while CA is concerned about how many matches would go beyond a paywall. Seven wants the digital rights to Tests for its free streaming service 7Plus, and for the One-Day Internationals to be put in front of the paywall (they currently sit on Foxtel and streaming service Kayo Sports).

Seven, who is suing CA for allegedly breaching its contract by reducing the quality and standards of the BBL, is also requesting the competition to be shortened and amended and will end its court case if it succeeds. But it has been unable to offer the amount of money CA expects, which makes it difficult to do a deal alongside Foxtel. A joint bid between Seven and Paramount would allow the former to broadcast Test matches on free-to-air, and allow the latter to have exclusive coverage of the Big Bash League.

The Daily Telegraph reported on Wednesday Nine had held talks with Foxtel about a potential tie-up, but any deal between the two companies is highly unlikely.

The main reason for this is Nine’s bid for the cricket was not solely for free-to-air rights to Tests – it included its streaming service Stan (Stan competes with Foxtel and its streaming service Kayo Sports for subscribers). Nine is not believed to have submitted a formal bid and is not in agreement with CA on how much the rights are worth.

All networks believe CA has overvalued how much its rights are worth, given it is struggling to attract large audiences to the BBL and the poor ratings of Test matches between Australia and the West Indies (who are returning for summer next year).

Foxtel – the longstanding partner of the cricket – appears to be controlling most of the conversations about which free-to-air network will end up with the rights. Industry observers have pointed to this being evident by the fact former Foxtel chief executive Richard Freudenstein has joined the CA board and is leading the advisory group on the rights deal. Freudenstein still works as a paid director of real-estate listings portal REA Group, a News Corp controlled, earning $242,000 last year per its annual report.

CA has not asked Freudenstein to recuse from rights discussions despite his financial link to News Corp. Failure to secure a deal with significant financial uplift for the game would push CA towards sale of a portion of its commercial rights to private investment in order to raise additional capital.

CA’s chair Lachlan Henderson, who had previously declared that cricket was undervalued in the Australian market relative to the major football codes, pointed towards the competition among broadcasters as evidence that the governing body would raise the revenue it needs out of the deal.

“The conversation is commercial in confidence as we speak, but it is reaching the pointy end,” Henderson said on Friday. “There is a lot of interest in the cricket media rights, and we’re really pleased we’ve got interest from all the major parties.”

In 2018, CA’s pursuit of a $1 billion plus rights deal at all costs saw it reach terms with Foxtel to be the game’s prime broadcaster, ending nearly 70 years of cricket in Australia being broadcast almost exclusively on free-to-air.

From there, Seven and Ten duelled to be chosen as Foxtel’s free-to-air partner with rights to men’s Test matches, women’s internationals and the Big Bash League. Foxtel expressed an informal preference for Seven, as the two networks already had a partnership on the AFL rights.

Ultimately, Seven and Ten were split by the request to put in final bids by midnight on the evening before the deal was signed: Seven got over the line by offering $82 million per year over the course of the deal, outpointing Ten by just $2 million per year.

Nine and Seven declined to comment. Paramount was approached for comment.

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