Were Wales right in 2009 – will terrestrial TV ‘decimate’ Six Nations?

Were Wales right in 2009 – will terrestrial TV ‘decimate’ Six Nations?

When an advisory panel reviewed in 2009 the list of sporting events that had to be broadcast on terrestrial television, the Welsh Assembly submitted a proposal that the Group A list, made up of matches or tournaments that could not be sold to pay TV for live coverage, should include Wales’s home matches in the Six Nations.

It argued that as the television audience for those games amounted to 65% of the population, the national interest demanded that they be kept free for all. The panel agreed and amended the Group A list accordingly in their report for the secretary of state for culture, media and sport, but before a decision was made, there was a change of government and nothing happened.

The Welsh Rugby Union had argued that the matches should remain on the Group B list. Events could be screened live on a subscription channel so long as a terrestrial broadcaster was given secondary rights, as happens with England’s home cricket series. It was in no hurry for the Six Nations to do a deal with Sky but argued that if the tournament were restricted to the BBC or ITV, the value of the contract would depreciate. Sky was a valuable bargaining tool.

It is as well for the Six Nations today that Wales’s home matches are not protected since negotiations continue with CVC, the private equity company seeking a 15% stake in the tournament for £300m and in return control of its commercial arm. That would give CVC licence to negotiate the broadcasting deal that starts in 2022. The BBC and ITV currently pay £90m a year for the rights and given the problems both broadcasters face, are unlikely to be able to afford more than an incremental increase.

That would hardly suit CVC which, in its successful pitches for a 27% stake in both the Premiership and the Pro14, argued that rugby union had undersold itself, particularly when it came to broadcasting rights.

The value it places on international rugby can be measured by the fact it invested £320m in the two leagues for an effective 54% and has offered £20m less for 15% of the Six Nations, although the package would include the rights for the autumn internationals in all the unions.

The investment would make sense only were there to be a pay-TV element in the next broadcasting contract, even if the southern hemisphere unions agreed to the July and November tour matches being given a competitive makeover on the lines of World Rugby’s proposed Nations League that was shot down last year, albeit without relegation.

The danger for CVC now is that a deal taking live matches off free-to-air would spark public outrage and probably a petition to the government for the tournament to be promoted to the A list – depressing its broadcast value.

The Six Nations are so determined to keep a terrestrial element that they are holding out against giving CVC commercial control, wanting to have the final say. While it is in all their interests to secure a lucrative deal given they would be handing over 15% of their profits each year in return for the lump sum, they are also conscious of the impact on the game’s profile should the Six Nations, along with the November internationals, be taken off free-to-view channels.

When that 2009 panel met, it was presented with figures showing a stark difference between the audiences generated by Sky, then the major subscription service in sport, compared with the BBC and ITV. The first leg of a Champions League semi-final that year between Manchester United and Arsenal had a viewing figure of 1.77m on Sky compared with 7.48m on ITV for the second leg. There was a similar 4-1 split for the 2005 and 2009 Ashes series on Channel 4 and Sky respectively.

Sky defended itself by saying that fans watching in pubs and bars were not included in the figures, although the panel concluded the number was insignificant with most viewers preferring to watch big matches at home. But there was no comeback for the figures showing the number of young viewers: a mere 31,000 children aged between four and 15 watched the 2009 Ashes – on Sky – compared with two million when England played Sweden at football’s 2006 World Cup finals – on the BBC and ITV.

The Welsh Rugby Union submitted in 2009 that a Group A listing would “decimate the sport” in Wales and threaten its investment in the game. Meanwhile the Six Nations provided written evidence that concluded: “The Championship may be competed for by the national representative teams of the six participating rugby unions but it is NOT a public asset, owned by ‘the nation’.”

“The technology and power of broadcasting means a sport cannot stand still,” says Richard Cramer, the managing partner of Front Row Legal, which specialises in sports, media and business. “Change is going to happen anyway and a question the Six Nations will be asking themselves is whether they have the expertise to manage it.

“CVC does and it will have its eyes on overseas markets. If the Six Nations are satisfied that selling a stake to an outside partner will lead to increased revenues, it is a good reason to do it, although a hybrid television deal looks the most likely outcome.”

More information: THE GUARDIAN.