The AFL rights story has it all. Business, politics, media and sport all thrown into one big heady mix which only Crikey can cover without pulling any punches.
It looks almost certain that the people who destroyed rugby league have now bought AFL. Packer and Murdoch already have way too much power in Australia and now they’ve bought the national sport.
Little Kerry Stokes will struggle to match the offer and with a highly geared 37 per cent stake in Seven, Stokes is unlikely to go over the top to satisfy his ego.
The fact that he’s staying in his $10 million Aspen getaway and skiiing at the moment says it all about the reclusive orphan and former TV-repairman whose entry price into Seven is about $4.50 a share. His banker, Westpac CEO, David Morgan, would probably not allow him to the big boys.
The AFL rights is the classic story that mixes business, politics and media.
It was that monumentalist Jeff Kennett who really started this whole process by persuading the AFL to underwrite a $450 million stadium Melbourne did not need at Docklands.
Kennett put former Liberal Party Treasurer Graeme Samuel in charge of Docklands and given he was already “Mr Mergers” on the AFL Commission, he was in charge of the masterplan.
The only way the stadium could be viable was to tie up the AFL broadcasting rights with the bidding. This saw News Ltd and Seven emerge as key partners in the winning consortium and we also saw the first abuse of power and media conflict of interest.
The Herald Sun failed to campaign to save Waverley even though their readers flocked to the ground which was near the geopraphic centre of Melbourne. When 74,000 people turned up to the last Waverley game between Hawthorn and Sydney in August 1999, the punters were sending a very loud message to the AFL and profit-driven but hopelessly conflicted media companies like News Corp which failed to save Waverley in pursuit of the almighty dollar.
Because Docklands has been a financial disaster, the pressure to do a quick deal over the AFL broadcasting rights post-2002 intensified. The AFL is due to make a $30 million commitment to Docklands shortly but have been hamstrung by a Heritage listing of Waverley which prevents them from selling it for a hoped for $85 million.
Several clubs have just announced big losses and have mounting debts which they hope this deal with News Corp will fix.
The multi-hatted and hopelessly conflicted Eddie McGuire was pushing this line when it was announced Nine would have the free-to-air rights.
“From a footy point of view – $500 million, wow,” said breathless Eddie. “What a day – $500 million and the best ever free-to-air coverage you can get, it’s just the stuff of dreams.”
Eddie appears to have no understanding of conflicts of interest. Earlier in the day he was announced as the winning bidder to run the Steve Bracks-pushed national footy tipping competition along with secretive gambling estate Tattersalls. My strong hunch is that they were advised by those Labor Party door openers Hawker Britton who have David White, the man who gave Tatts their $2 billion pokies licence for nothing, representing them in Melbourne.
If that wasn’t a big enough conflict, Eddie also owns 25 per cent Sportsview.com, a company which owns the internet development rights for six of the AFL clubs and creams off 65 per cent of the revenue they generate.
Wearing his Collingwood hat, Eddie stitched up the rights to his club as well as arch-rival Carlton, whose odious chairman John Elliott has appeared regularly and favourably on The Footy Show in recent years.
Eddie really is the connecting player in this whole drama. After bumping into Herald Sun editor Peter Blunden in a St Kilda restaurant in 1997, his lawyer agent Geoff Browne stitched up a six figure deal for Eddie to write a page of gossip in the Saturday Herald Sun each week. He uses it sometimes to push his mates, Channel Nine, Collingwood and all things Packer.
Much of it appears to be written by his brother Frank McGuire, who runs McGuire Media. The lads have come a long way from Broadmeadows with Eddie now living in a seven-figure Toorak mansion.
Eddie’s success at hosting The Footy Show led him inside the Packer empire through some legendary six hour dinners at Crown casino with Packer senior and junior. He was Lloyd Williams’s MC of choice at Crown Casino and then got the symbolic life time nod from the Packers when he was MC at young Jamie’s wedding last year.
He then teamed up with old buddy from Ten, Steve Quartermaine, to give Village Roadshow’s MMM radio station some football commentary starting in the 1999 season. Eddie poached Sam Newman from 3AW last year and Sam will be his key anchor on Nine.
Ironically, Quartermaine and McGuire first had some tension when Bruce McAvaney, now at somewhat of a loose end, was poached by Seven from Ten. This opened up the sports presenting job on Ten in Melbourne and the then afternoon Herald’s gossip column Tattler reported in 1990 that McGuire and Quarterbrain squabbled over the reading gig which went to McGuire.
McGuire has the biggest sports and media network in Melbourne. He also built a phenomenal business network through Lloyd Williams, the Packers, the Bartels, the Foxes and his now relinquished status as the perennial MC at corporate functions in Melbourne.
He proved he could built an entertaining team at The Footy Show and then at MMM and the AFL will be hoping he can do likewise at Nine when it is host broadcaster.
Rupert Murdoch’s strategy in all this is fascinating. The Herald Sun, his biggest selling paper, will remain the “voice of football”. However, expect them to become more of a cheer squad than a paper of record, just like The Daily Telegraph did during the Super League wars.
Terry McCrann and Mark Westfield have already weighed in with predictably positive commentaries backing the Murdochs.
McCrann said Lachlan had pulled off a “stunning coup” and advises competitor Kerry Stokes that “it would be madness for Seven to cling to the free-to-air. It would lose even more money than it has in the past – and fail to boost ratings as well”.
The AFL is about the only thing that Seven has got right over the years. They’ve paid well below market for the rights for most of the 40 years they’ve had them, it has underpinned their ratings and they’ve made a shitload out of it.
What on earth is McCrann talking about? Why is something a “stunning coup” for his boss and “madness” for his rival?
Westfield is equally breathless in The Australian in his column under the headline “Football is the winner”. He describes Seven’s “cynical grip” on football as “a choking monopoly” which is exactly what Murdoch has over pay-TV in Britain and the newspaper markets in Adelaide and Brisbane.
Somehow Stokes seems to get blamed for the “arrogance” Seven showed to the AFL in 1986 when it was controlled by Fairfax family. And then there is this line: “Network chairman Kerry Stokes Kerry Stokes will leave Seven, when he retires soon, in tatters.”
From what we can tell he is about $200 million in front so far.
Seven’s attempts to hang onto the rights were labelled “pathetic” and “meagre” by Westfield and he then says “Foxtel has added to its programming arsenal by winning the National Rugby League rights for 2001 over Seven”.
Yeah, but Mark, what about the $500 million your boss lost whilst destroying rugby league. Don’t you think that is relevent. And of course Foxtel won the rights when Rupert owns 50 per cent of the NRL.
Where are the following sorts of lines in the commentaries offered by McCrann and particularly the acerbic Westfield.
“Having blown up $500 million on League, Murdoch has now doubled his bets with an over-the-top bid for AFL. Clearly, it won’t pay for itself but Murdoch is hoping to use it to batter Telstra into submission at the Foxtel negotiating table and then destroy Optus Vision, giving Murdoch an all-powerful monopoly over pay-TV like he has in Britain.”
“With the ignominy of One.Tel, Fox Studios, digital, PMP, News Interactive and Super League hanging over Lachlan Murdoch’s head, the young media scion is hoping this last desperate roll of the dice will restore his chances of succeeding his father at the top of the global media empire.”
Don’t expect to read this sort of commentary in any Murdoch paper soon because even their best respected commentators such as McCrann and Westfield cannot report the action objectively.
Crikey will be cranking up its coverage of Murdoch and Packer in the months ahead. They already have way too much power in Australia and now they’ve bought the national game. If you’ve got any examples of blatant biases in Murdoch or Packer media outlets or examples of their excessive power then just send in the emails.