Ten vows to ‘restore cricket to former prominence’ after $200m+ bid

Cricket Australia chief executive Nick Hockley is leading the negotiations. He has told the commercial broadcasters and pay TV operator Foxtel to ensure they have put up their “best number” in the hopes of signing a seven-year deal.

Separately, former NSW premier and board member Mike Baird will become chairman of Cricket Australia from mid-February, replacing Dr Lachlan Henderson.

Ten ‘revolutionised the Big Bash League’

Ten, which is owned by US media giant Paramount, has put in the largest offer for the cricket rights, according to multiple sources, hoping to air the Tests, the T20 and the Big Bash League (BBL) across its free-to-air channels and its subscription streaming service Paramount+.

The network has offered “modestly” in excess of the current $200 million a year deal, The Australia Financial Review has been told.

Leaders at the network pointed to Ten’s previous success in televising the BBLsaying they would “deliver a premium product with greater visibility, consistency and flexibility across all forms of cricket” if Ten won the rights.

“It was only a few years ago that Network Ten delivered the Big Bash League to a larger average audience per game than both the AFL and the NRL,” a Ten spokeswoman said.

“Network Ten revolutionized the game. BBL became cemented in Australian culture as the family’s favorite summer sport. In 2015, Network 10 attracted an average of 721,000 viewers per game and live crowds averaged more than 28,000 a match.”

Ten has the most to gain, and the most to lose, when it comes to the rights to televise cricket. The network has had a rough year, losing out to Seven and Foxtel for the AFL rights and ending up in fourth place in the overall ratings behind the ABC for the third time in recent history.

Sports rights are critical for free-to-air broadcasters as they generate the largest audiences, which leads to more ad revenue. Pay TV operator Foxtel also needs top-tier sports but cricket is pivotal to keeping subscribers for the company’s Kayo Sports streaming service during the non-football summer months.

The cricket rights are the final “tent pole” sport on offer in the short term. Nine holds the NRL rights until 2027 and the tennis rights until 2029, and Seven and Foxtel are contracted to screen AFL until 2031.

Seven, which is in a legal dispute with Cricket Australia over its rights deal for the Big Bash League, played down the bid put in for the cricket rights. Nine sources also indicated that the network would look at the Test cricket portion of the rights, but executives believe it is not crucial to have.

The parties have submitted their second round of offers and cricket officials are evaluating each one against a series of criteria including the cash component and how and where the sport will be broadcast and promoted on the respective bidders’ outlets.

Colin Smith, a sports rights analyst who was involved in the development of the original Big Bash League slate a decade ago, said Ten needed to win the cricket.

“On free to air, your whole economic model is driven by reality TV, news and compelling sport,” Mr Smith said.

BBL ‘has gone backwards’

But Cricket Australia had been its own worst enemy with the Big Bash League, he said. Ten built it up in its first few years after it was created in 2011, but “it’s gone backwards”.

“It was clearly No. 2 in the world on T20. By the end of next season, the BBL will rank seventh or eighth in the world. It needs to be shortened. It’s wall-to-wall cricket. There are no discernible windows,” Mr Smith said.

Ben Willee, general manager of media agency Spinach, said: “It’s a loss leader. Nobody ever recovers the sports rights. They use it to promote themselves, their content slate. Channel Nine don’t need the cricket as much as Paramount do. Nine have got the tennis. Audience and timing is different, and it’s hard to justify the two different loss leaders.

“Cricket Australia have got to recognize the competitive nature of eyeballs. They’re not just competing with other sports and codes, the battle for eyeballs is hotter than Satan’s underpants. Everyone from Netflix, Disney+, broadcaster streaming providers – they all want your eyeballs, especially for video content, which is what advertisers want.”

Cricket Australia has been accused of being its own worst enemy with the Big Bash League. Getty

A Cricket Australia insider said the ultimate decision on the rights would come down to balancing cash and reach.

That is, for each offer administrators needed to weigh up the cash the sporting body could receive – which would fund the development of the game at all levels – and the number of viewers that would be reached by the outlet. On top of all of this, cricket officials want an arrangement that works best for fans.

A decision over the rights is likely in the next few weeks and although Cricket Australia officials are not keen to drag the process out, bidders have been warned that the onus is on them to deliver the best figure they can to win the rights.

There is debate within the networks over how much is a fair price to pay for the rights. The current six-year deal with Seven and Foxtel, which ends in 2024, is worth roughly $200 million a year and Henderson said in September that the sport was “undervalued in terms of its media rights”.

However, multiple parties said the current rights were worth about $200 million a year, but one party said a figure starting from $150 million was more reasonable.

‘Everyone wants cricket’

A cricket insider familiar with how the last rights negotiations unfolded said any deal of $200 million or less would be a disaster for Cricket Australia. The individual was confident that it would be pushing for a deal that, like Nine’s renewed tennis deal, was higher than the current contract.

“The good news is that everyone wants the cricket,” the insider said. “We haven’t had someone [like Ten] willing to take the whole thing for a while. So this all starts from a good place.”

One fear for Cricket Australia will be the type of coverage it will get from News Corp’s mastheads if it walks away from Foxtel (which is backed by News Corp).

The production costs, which are usually borne by the broadcaster, have been estimated at about $40 million a year, but an insider said these were likely to be much higher as the sport had traditionally been very expensive to produce. These expenses include the costs associated with broadcasting the matches, including paying for the hosts and commentary teams.

Cricket has been the subject of an intense overt and covert campaign questioning the value of its rights, and Ten has also been targeted by critics as being on its last legs.

Response to critics

Cricket officials are dismissive of the talk, highlighting the strong interest the bidders are showing for the rights and the fact that matches are still drawing big viewing numbers. They believe the loudest criticism of the sport is coming from parties worried about losing the rights.

The officials have also defended the decision to put cricket behind the Foxtel paywall, the first time in the sport’s history this has been done, as one that has delivered big online audiences and a financial windfall for the sport.

A Cricket Australia spokesman said last year’s Boxing Day Test (screened on Seven) drew an average audience of more than 1.7 million viewers on television, excluding streaming viewers.

He also said the Indian team’s tour of Australia during 2020-21 broke viewership records for subscription TV, with 623,000 watching a T20 match across TV and streaming. In Cricket Australia’s view, having exclusive matches behind a paywall increases the value of cricket rights.

Those involved in the bidding said Cricket Australia had gone into the negotiations unwilling to budge on cutting the number and timing of the BBL matches, but the administrators have now indicated that they are open to changes if the offer is right.

Ten hits back

Ten is still licking its wounds from the AFL, which it lost despite using the financial firepower of its US parent Paramount to lodge a big bid for the winter sport. Paramount executives have noted that their global CEO, Bob Bakish, paid $US2.6 billion for the Indian Premier League rights in August and has talked up cricket as a key sport to drive viewers to the Paramount+ subscription service.

A Ten insider said the network’s negotiating team was “deep into specifics” of any potential contract and was “buoyant and optimistic”.

In the past, Ten has been reluctant to comment on what some rivals are saying about it. But it is now fighting back against what it describes as an ongoing smear campaign.

“It is unfortunate and disappointing that some of our competitors have made it their mission to perpetuate false and misleading stories,” the Ten spokeswoman said.

“Despite this, we remain very confident that the industry will continue to witness Paramount’s ongoing power and success across the market.”

She also says the network has unmatched financial firepower thanks to its US backers. The network says its bid for the AFL rights, the largest offer for any sporting rights in Australian sports broadcast history – worth about $6 billion, was beaten by a combined offer from Seven and Foxtel (which is backed by News Corp and Telstra).

“Network 10, as part of Paramount Global, is the most uniquely positioned media company in Australia … with unparalleled access to a global pipeline of content,” the spokeswoman said.

“The network has strong international backing and invests hundreds of millions of dollars in local content and more than $18 billion globally, with even more set aside for 2023.”

Seven West Media CEO James Warburton said last month that cricket audiences were lagging because “there’s no promotion from Cricket Australia, there’s no marketing from Cricket Australia”.

In response, the Ten spokeswoman said: “The current coverage is not resonating with sports fans, who have deserted televised cricket coverage in their droves. We have a commitment to deliver a premium product with greater visibility, consistency and flexibility across all forms of cricket, the network would provide blanket domestic coverage and take the sport to a new and freshly engaged audience.”

Edmund Tadros owns shares in Nine Entertainment and News Corp (which part owns Foxtel)

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