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With one A-League season remaining until a new television deal must be struck, the question many are contemplating is how much should FFA be aiming for?

Combined, the four football codes and cricket account for almost $1 billion in TV rights money each year. But analysis of the big five domestic professional sports shows that not all sports supporters are valued equally.

We have brought together published data related to the five sports to determine the total pool of supporters for each sport. The data involves participants, members, attendees and TV viewers. Many supporters will fall into more than one category but this is consistent across the sports.

The data in this table are not likely to present any surprises.

           

See footnotes re the table below.       

However, if we take the annual value of the current TV rights deal of each sport to determine the value of an individual supporter of that sport, there are some surprises.

What it shows is that the value of a single supporter ranges from $6 (football) to $34.21 (rugby league).

Is this a reflection of the negotiation skills of the respective sports? Is it a significant under-valuing of football or over-valuing of the other sports? Is it a sign of the relative negotiating positions of the sports v the broadcasters at the time each deal was struck? Are rugby league supporters bigger spenders and more suspectible to being influenced by advertising? Or are the broadcasters and corporates playing favourites?

If a football supporter was valued as highly as a supporter of one of the other sports, the TV deal would be worth in annual terms between $81 million and $228 million. On the basis of factors such as income, education, frequency of participation and attendance, as well as the broader reach of the sport itself, there is no empirical reason for the relatively low value of a football supporter compared with other sports.

Rather than being tied-up in knots over ‘metrics’ such as TV viewership on subscription TV to which only one-third of the population has access or attendance at A-League matches, or being compelled to talk big on expansion (again) as a sign of future plans to entice a new broadcaster, the FFA should focus on maximising the value of its individual supporter.

If a football fan was considered as valuable as a cricket fan – football’s direct competition in summer – the TV deal be $84 million a year.

This would help fund expansion of the A-League and W-League; fund promotion and relegation through further development of the NPL; improve talent identification and player development; improve pay and conditions for W-League and Matildas players; improve referee and coaching development; and – the holy grail – see the ‘great big tax’ on amateur players finally stopped with money flowing back to the grassroots game.

Another way of putting it is this. If we take the $1 billion a year as the limit of the funding pool available for these five sports, if all supporters were valued equally, the annual TV deal would look like this.

It rewards the sports based on their quantum of supporters, but it also means that all sports supporters are valued equally – which is surely how it should be.

One issue that is reported as troubling FFA and A-League clubs about the forthcoming deal is the unbundling of the rights for Socceroos and the A-League. 

According to reports, FFA has been “blindsided” by Lagardere Sports (formerly World Sports Group - WSG) retaining the rights to Socceroos Asian qualifying matches. Perhaps the former CEO omitted this detail in his handover notes to the current CEO, as it should not be a surprise.

Special dispensation had to be struck between the Asian Football Confederation (AFC), FFA and WSG in 2012 to enable Socceroos rights and A-League rights to be bundled. The AFC was concerned about the possible breach of FIFA and AFC Statutes, and the precedent it set, so they sought external advice about the matter in May 2012. The advisor (who had previously been a Head of Legal Affairs at FIFA) wrote:

“I can appreciate that doing a deal of this nature may not only be against AFC Statutes (entering into a commercial deal with a member association), but that it may set an unwelcome precedent for the future. In addition, I have some other concerns. Bundling rights usually means that the party doing the bundling can artificially attribute valuations to each component of the package, depending on what advantages this may bring. For AFC, it therefore means that (i) there is a complete lack of transparency in the overall transaction, (ii) the transaction is open to abuse, and (iii) it is impossible for AFC to derive a true market valuation for the rights offered.”

In the aftermath of the AFC dealing with the fallout from Mohamed Bin Hammam’s lifetime ban from football, the AFC agreed in June 2012 to sell the rights to WSG for $16 million per year for the four years, with WSG to on-sell them to FFA for the term of the current agreement. 

This legacy arrangement explains why there hasn’t been any spare change from the current deal. Not only is the $40 million fully committed with the A-League salary cap and paying WSG for the rights to the Socceroos matches - but football supporters are under-valued compared with other sports supporters. 

Footnotes 

1.  Participation of adults and children in the outdoor forms of sports, other than school sport, from the Australian Bureau of Statistics;

2.  Attendance at non-finals matches in the most recent complete season for AFL, NRL, A-League, Super Rugby matches in Australia and the Big Bash League;

3.  Membership of clubs via the individual sports where possible. For AFL and NRL it is for the current season; for the A-League it is for 2015-16 season; for Super Rugby, it is for 2014; and for the Big Bash League it is a generous estimate as data is not available. In respect of the BBL, if membership is less than the estimate, then the value per supporter will increase. 

4.  TV viewership is based on total regular or occasional viewership of sport according to Roy Morgan Research. 

5.  TV deal is as reported. 


Categories: Analysis | A-League

a-league, tv rights, sports attendance, sports participation, membership, tv viewership

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