Today we are feeling rather literal in our mission to unmask the AFL as just possibly the most stupendously stupid and hopelessly conflicted sporting body in this wide-brown land. Sports insider Patrick Fitzgerald has delivered the goods with this brutal attack on the AFL.
I have no idea where the AFL goes for its own, although we now have a pretty good picture of a whole gaggle of Mr Magoos stumbling around AFL House from one management crisis to the next. If they were the NRMA, you would be taking out risk insurance on your insurance cover!
These nearsighted mental giants are in need of intensive care and I am only too happy to provide lots of gratuitous advice to guide them to the nearest exit.
The AFL continually tells us why it is the number one sport in Australia. It puts more bums on seats (more than 6 million annually) than any other domestic sport, and also (Rugby League might argue otherwise), boasts a greater aggregate of TV and radio consumers.
But in this humble scribes view, when you have the best football code in the world to underpin you and an historically fanatical following that per capita is the world’s most popular (see how useless stats can be) you don’t have to get a lot right to be on top of your game.
But then you don’t have to get a lot wrong to be out of form and the trouble is the AFL team is looking more and more like bench material. We already know they can’t make All-Australian and we are now more and more in awe of Kevin Sheedhy’s prescience when he gave AFL chief, Wayne Jackson, a big serve last year by observing he was “one of those guys who seems to hang around football”. Yes but for how much longer?
In the last three broadcast rights agreements (or two plus an extension), the AFL has been delinquent in demanding more say in how its product was being scheduled in markets like Sydney and Brisbane. But for sheer consistency in setting new lows in contractual negligence to the point of incompetence with this new three-way agreement, Jackson has sold the public a bill of goods. The AFL corporate affairs unit run by the ultimate Mr Magoo, Tony Peek, is spinning like a top as the AFL battles to overcome its worst PR nightmare that makes Colonial Stadium seem like the provincial Melbourne bun fight it was. The AFL would have the media somehow attribute the current “rights” fiasco to a bit of an oversight, like somehow the fine print of the deal snuck by them. On that basis you should have no problem building a nuclear power station at Docklands and convincing the AFL it’s an art gallery.
Permit me to attempt to translate their spin.
Literally millions of fans around the country are up in arms over reduced, delayed or no longer free AFL television and Internet services particularly on-line radio live match broadcasts. The AFL wants the public to understand they (the fans) find themselves in this very unfortunate position because the AFL somehow expected that with all the goodwill in the world, their media partners in this new five-year $500 million deal would do the right thing. How could the unsuspecting well-intentioned good folks at AFL House know that in the small print of these deals, lurked some rather nasty little grey areas?
It’s these that are now the cause of so-much angst the length and breadth of the country, and why the AFL is so actively holding urgent meetings to try and at least convince the regional TV folk to get with the AFL’s new programme. That should be a fair test of the Magoos’ vision but it doesn’t even get close to the real problem?
The big city slickers at Channel’s 9 and 10 in Sydney and Brisbane, who it transpires are not nearly as hot for all things AFL as they would have had the AFL believe when their team captains first came calling to lick Wayne Jackson’s corporate boots.
So on Thursday so much of these scheduling crisis meetings between the AFL and its media partners, and muted threats and entreaties from the befuddled Minister for Miscommunications, Senator Richard Alston, was a mostly futile attempt by the AFL to put the broadcast cork back in the bottle. Best place to start would obviously be where you might sneak a win with some home ground advantage. Let’s at least get the more traditional AFL strongholds like Southern NSW, maybe Canberra (now the Raiders are shite), and the Gold Coast back in the live AFL game day picture. And if not live, then what about showing games at a reasonable hour that isn’t a drop kick short of midnight? They would be dropkicks to refuse wouldn’t they?
Let’s just cut to the chase: Fact: Small print in a contract is exactly that. There’s always a good reason to make it small and is usually there to contain pesky little surprises if these are not gone through legally with a fine tooth comb. If we were to believe the AFL the small print in their agreement is probably approximate to a microdot! How else do you explain a legal team that seemingly either didn’t read it, which would be a rather criminal neglect and we certainly don’t believe that, or god forbid they didn’t grasp all the implications as to what demands or guarantees relating to TV scheduling commitments the AFL was being offered. Not some wishy-washy indeterminate sub-clauses that either implied or expressed use of “best endeavors” regarding matters affecting programming. The whole nature of this agreement should have been rooted totally (putting the money to one side) in just precisely what the contracted TV consortium was actually offering in pure broadcasting terms. How else you judge their push for the game by comparison with what was known or understood to be Seven’s commitment?
So if you accept that somehow the AFL dropped the ball on this, what the hell was going on at AFL House because a lot of people weren’t remotely on top of this? You retain lawyers to precisely avoid this sort of non-delivery no matter how optimistic you are in accepting that behind all the flannel of good intentions; it is solidly backed up by iron clad contractual obligations. Usually in the case of the AFL, they primarily rely on Eddie McGuire’s lawyer, Jeff Browne. Whether it was Browne playing chief legal eagle or a collective team acting in unison (which is the more likely), and were they purely drawn from Browne’s practice or involved more than one law firm’s input? Again the smart move would have been to have several experts drawn from more than one firm. Whatever the truth, someone owes football and its fans generally a detailed genuine explanation for what now passes for a supposedly superior national TV coverage, but most of all the AFL clubs themselves who stand to win or lose most if this situation is not significantly improved. They also need to understand how AFL House got this so horribly wrong and heads should roll.
It would seem we should somehow believe the AFL was so busy extracting maximum dollar value and hearing the kind of numbers that were music to its ears, that somehow the detail of what it could expect in return, got lost in all the delirium of the deal. We might accept at face value that the AFL finds itself disappointed by the level of live coverage or matches shown free to air at something like a reasonable hour where children can watch their favorites. But the truth is they knew well before the season, in fact I was assured by one insider even as the deal was still warm late last year that what would happen with Channel 9, has now come to pass. The AFL is simply flat out lying when they now feel that somehow they’ve been conned or left to feel let down.
We could go along with the AFL style spin regarding the “fine print” because it is actually plausible, except the timetable for knowing what they did when they did is paramount and the AFL has only bothered to seriously address the issue when it totally miscalculated just how badly fans up north were being screwed. Yes Channel 9 is the villain and we can accuse them of hoarding and hopefully Senator Alston and the Federal Government might wave a stick, but don’t hold your breath because the Liberal-friendly Packer.
It doesn’t placate the disadvantaged in Brisbane or Sydney or elsewhere to understand that the AFL got it wrong. That the reason why they can’t access Friday night live on Channel 9 and other affiliates is because Rugby League gets the nod and they were always going to be first. If the AFL owns up to its own stupidity and what else can we presume, who’s going to accept ultimate responsibility? In any major contract all parties ultimately reach agreement over the fine print.
You can’t withhold it or promise one thing and do another, nor could the AFL ever simply rely on unstated delivery of favorable outcomes. You just don’t ask Kerry Packer to be the tooth fairy.
So here you are as the AFL and you have a product that all sorts of big, greedy media companies are anxious to get their hands on. Ultimately the winning bid is willing to shell out $80 million a year (plus around $20 million delivered in kind by News Corporation on no doubt a rather interesting formula as to how that is calculated. So who is the dominant party in this process?
Well pre-deal you had one major TV network Seven, thinking it was in a competitive process against two other free-to-air networks, like Seven bidding as individual companies. Foxtel was always likely to be tied in with Channel 9, just as C7 was factored into its parent. Instead at the initial tender stage, Seven got totally ambushed by three major TV companies bidding as a consortium (so much for genuine competition) and throw in on the side a hungry Internet predator Telstra, who is also 50% stakeholder in the successful Pay TV rights holder Foxtel. Certainly when the bidding started the AFL would have felt no need to rush out for the Vaseline! It is the dominant partner and everyone who counted was anxious to secure their respective media rights across all platforms.
Channel 9 from the outset wanted to secure Friday night AFL. Why? Because it was the only game in town in every state but two and Melbourne was critical together with Foxtel (25% owned by Packer) being a major piece in the puzzle. If that meant Channel 9/Packer had to park Friday night AFL in Sydney and Brisbane…so what? That’s what hoarding is all about, taking out your main competitor or at the very least neutralising them. Better still you actually control promoting and marketing the AFL’s major rival and can give them the priority in the market the AFL now covets. Channel 9 and the Packers potentially had the AFL lined up for breakfast where there was only ever going to be one winner. However, Channel 9, to seal the unlikely alliance with Channel 10, found it necessary to give up the rights to the finals to 10, a subject that is still a raw nerve with Kerry Packer given that 24 per cent of the advertising comes from finals footy.
But the fact remains as the regular season “jewel in the crown”, the AFL controlled the whole bidding and contractual process. It put the rights to tender and therefore it set the agenda as to what was for sale and controlled all means by which it made a sale. Regardless of any other consideration, the AFL was totally able to place key conditions on what was acceptable and what was not as to the telecast of its football (with due reference also to Federal anti-siphoning regulations governing the showing of major sport on free-to-air TV). This fact if anything only further strengthened the AFL’s negotiating position.
In any “normal” commercial negotiation where the vendor has a hot product, they call the shots, not the people desperate to do the deal and hand over the money. Any fine print in this situation is and always should be very much the prerogative of the vendor (AFL). Convention would dictate that there are within all the myriad clauses or variations that usually demand the fine print in any contract, hard and fast rules or terms (deal breakers) that basically set the tone for everything else that follows. If any potential bidder has any problem with the basic ground rules, you should simply eliminate them and do business with those that will.
The AFL never applied this process otherwise they would not be where they are now – north of the Murray without a paddle!
But we are asked to believe that with the help of the fine print of the TV rights (let’s not even bother with Internet today), somehow inadvertently the AFL allowed Channel 9 to run a camel through the eye of a needle! Believe that and you believe Tony Lockett will win the Coleman Medal this year. The upshot is AFL fans being lied to by incompetent, until now unaccountable cynical operators who took the money and ran when they ultimately inked this deal.
This writer doesn’t use hindsight when I charge that the AFL ran away from its fundamental corporate responsibilities to protect the game. That they manifestly failed to knowingly anticipate even the most basic commercial manouvres, which might give other vested interests antithetical to the AFL, not just the odd free kick, but potentially the whole ball game beyond the traditional southern AFL states.
So the Magoos’ encourage us to believe that the AFL thought they were dealing with the tooth ferry and not Australia’s most consistently ruthless businessman and his One-Tel ignorant son.
They could not foresee that not just two States, but just as critically traditional AFL pockets north of the Murray, such as Canberra (very funny that one hey Senator?), Gold Coast, Riverina, and the Northern Territory might be deprived of live or (60 minutes) delayed AFL Friday night games.
So obliging was the AFL it agreed for the first time to allow manipulation of the draw specifically to ensure many of the best drawing games got the Friday night slot. Friday night commands the single greatest promotion and aggregate weekly rating in AFL. The wizards at AFL House having happily signed away their showcase TV product to Channel 9, throughout the off-season and until this week, was insistent in telling anyone who would listen how much better off AFL fans would be through having the best of all possible TV worlds courtesy of this radical three-way TV deal. It also bragged about the massive bucks they had extracted in stitching up the deal. To the AFL everything sweet about this deal was getting top dollar.
Seven against the combined might of the TV trilogy also felt very stitched up. They may yet discover via legal action whether the consortium acted as a cartel in ganging up on the league’s old broadcast partner of some 40 years, but that would be of little consolation unless (and how the tide of public opinion is now turning), if there was provable collusion of cartel like behaviour and then who knows, maybe Seven could legally demand a new tender be put in place and this time no ambush?
But as now seems more likely who is going to pay that sort of money in light of a world-wide re-evaluation as to the true worth of sporting rights that is sending TV rights holders around the world into bankruptcy? This phenomenon is already causing many sports unbelievable problems from the very top (FIFA and Formula One), right down to the bottom of the sponsorship and TV rights barrel. In that you can include Australia’s troubled National Basketball League (NBL) that has just seen it’s marketing and sponsorship partner and formerly 15% league stakeholder, the financially crippled Sportsworld Group, just walk away from its future obligations.
This now leaves the NBL worse off by an estimated $2 to $3 million income previously guaranteed by Sportsworld. That money is not going to be remotely replaced and some NBL clubs will go the wall. It’s even possible the NBL like the National Soccer League and most of its clubs next year, might have to consider winding themselves back to part-time just for the league itself to survive?
AFL connection to Sportsworld disaster
In typical fashion the NBL-Sportsworld decision this week to “mutually” terminate their massively unprofitable partnership is cloaked in a confidentiality clause. What that means is both are so profoundly embarrassed by Sportsworld’s imminent demise in the UK (it’s shares are now suspended) and all its various operations shall be sold off as separate entities. Again this presents further massive headaches to a number of significant Australian sports, including AFL where there are allegations circulating that Sportsworld owes up to four AFL clubs significant signage income from last season. Sportsworld via its local sports marketing and management company Elite Sports Properties also is an official memorabilia licensee for both the AFL and Australian Cricket Board, and there is likely to be income streams there tied up in the corporate woes of Sportsworld’s future.
Time to neck Wayne Jackson
All of this suggests that while the AFL has like some schoolyard bully gone around beating its chest and strutting like some gamecock for the past few months since its TV deal was done and dusted, all its chickens are now starting to come home to roost. Head of the queue for the Ingham Brothers special “necking” must surely be Wayne Jackson. At the end of the day he stands the watch for ensuring that his executive team is on top of their game. You do not construct multi-million dollar deals and spruik them as the future of football, and then when you have seen the camel pass though the needle’s eye, the AFL defence is basically down to inexactitude in the fine print. Or maybe not a little misplaced trust in Channel 9 to put AFL interests ahead of Rugby League?
Absolute bollocks. For years I have contended to any number of senior AFL figures and media types that cuts across the whole corporate AFL culture, that the league must “insist” that its prime match product be shown live or at worst slight delay in the northern markets of Sydney and Brisbane (and by association everywhere else it mattered). That no TV bid even be entertained unless those pre-conditions were met. Sure this presented some issues for Sydney on Friday night, but already the guaranteed longer-term consolidation of Brisbane as a competitive elite AFL club, should make Brisbane home and away a no-brainer to build up in Queensland. But even yesterday as the AFL and the TV heavy hitters attempted to begin a quick fix regional clean up of the mess they have created, the spin doctors were still trotting out the same tired old line how even an old movie can out rate the Sydney Swans on a Saturday night.
But this is not about right now, or even three months from now. This is about the AFL with a major free-to-air network making the long-term commitment to grow a meaningful relationship where together they work to build the market. This is not some flight of fantasy. It seems to the credit of Channel 10 management in Sydney, they are attempting (partially) to do this by backing the Swans with Saturday night games and possibly some other concession in light of Thursday’s talks. But Channel 9 and other major regional markets that take the Rugby League Friday feed aren’t turning turtle.
It’s also why the AFL’s whole TV strategy for the next five years now lays in tatters. Kerry Stokes could be forgiven for thinking it’s taken a long time of monopolistic arrogance for the AFL big wigs who so ungraciously bushwhacked him last year, to now get theirs…but that’s what’s unfolding before our eyes. The cry of the north until now has been as nothing compared to what may lay in store for those operating the AFL switchboard if the Brisbane v Essendon game is on any kind of free-to-air major late night delay around the nation, let alone Queensland on Saturday night.
It’s almost impossible to believe the terminal stupidity that led the AFL to hand over Friday night to the existing Rugby League network, and so effectively sabotage or warehouse the AFL’s premium brand. Did they seriously believe that the Packer’s after a lifetime of trying to prop up Rugby League were now going to be a significant instrument in its possible capitulation to the seemingly inexorable national expansion of AFL?
What idiot in the business world effectively sells his strongest product of the number one brand on the market to a company that also sells or markets his greatest rival and number two? But not only that lets his rival then effectively bury his product without any kind of contractual safeguard or legal get out, should such an “unlikely” or bad faith eventuality puncture this wonderful new relationship.
Money has blinded the Magoos’ at the AFL, but even allowing for the “Gecko factor” you have to seriously question how supposedly smart administrators, surrounded by costly “independent” legal advice, a veritable phalanx of other experts via the AFL Commission and the Clubs…all of them failed the most basic test when this great TV deal was signed off. Not only were they ignorant to the sensibilities that has now outraged a couple of million disenfranchised fans in their most volatile and elusive northern development markets, but they did what plenty of others have always had a great deal of trouble coming to terms with…trusting Channel 9 to do the right thing.
You didn’t need to be clairvoyant to have advised the AFL that if you must insist on giving Channel 9 AFL, when they already have Rugby League, then you make doubly sure you cover your rear! How hard was that? Viagra hard apparently and now the AFL needs more than Vaseline to put this right!
Brendan Gale puts the cat amongst the pigeons
To put one more final nail in this AFL worst week that was, current AFL Players’ Association president, Brendan Gale sure put the cat among the pigeons on Four Corners last Monday.
Gale’s revelation the AFLPA is more than likely in the next Collective Bargaining Agreement to see significant pay increases beyond 2002 had club president’s dong a collective choke. The words had hardly disappeared from our TV screens when “Spot a Crisis” Smorgon, beleaguered Western Bulldogs president, David Smorgon was crying foul that the AFLPA was showing reckless disregard by not giving the principle of 10 Victorian clubs the thumbs up rather than “the bird”. His club is nearing financial oblivion and the Bulldogs don’t have another “near death: appeal in them that will change their destiny. But Smorgon now sees Gale’s warning as the gathering storm that could finally blow his club away.
As if over-reaction and stupidity are necessary bedfellows for some AFL presidents, Smorgon didn’t have to wait long for company. Collingwood president, Eddie McGuire did a virtual 180 degree turn in talking up economic rationalism on the same Four Corners, basically accepting the rule of the corporate jungle that market forces will prevail, then before you can say “who wants to be a millionaire AFL player”, Eddie is ready to take to Gale with a “machine gun” to combat any possibility of the AFLPA taking a “baseball bat” to get more money from the clubs and thereby putting some clubs (Melbourne ones) at risk.
Now that was Eddie taking a realistic approach to market forces just three days before, and also heading up a wealthy club that preys on recruiting players from struggling clubs. Is it any wonder the AFL gets a bit confused with TV contracts when the part-time Collingwood president and full-blown media personality, in the space of a few days can’t make up his mind whether he supports market forces or wants the AFLPA to ignore them?
And so to the business of kicking the AFL for selling out the game…read on.
Mr AFL CEO,
What a blot on our game (I was about to say on your record) this abominable TV “rights” affair is! Little if any consideration for the fans that have been slapped in the face.
And now it is too late. AFL’s reputation has been sullied by your supreme insult to our intelligence.
History will record that it was during your administration that such a crime against all AFL fans was committed.
You and your Commission dare to do this. Very well, then I shall dare too. I shall tell the truth for I pledge that Crikey will tell it the way it is. It is my duty to speak up. I will not be an accessory after the fact. If I were, then my viewing nights and days would be haunted by the specter of that crime committed against the game.
Of innocent fans so far away suffering the worst kind of torture as they pay for a crime you have committed.
I accuse Wayne Jackson and his minions of having been the diabolical agent of a miscarriage of TV transmissions (and Internet)…. of having sold the fans out and then defended this evil deed for months through the most preposterous and diabolical excuses…
I accuse Channel 9 and Channel 10 of having had undeniable proof before the season started that the fans in Sydney and Brisbane and elsewhere would be disadvantaged…and having suppressed it. Of having executed this crime against the fans and against the game for corporate purposes, so that the AFL administration, which had been played for suckers, would not lose face.
I accuse the AFL communication department of having conducted an abominable campaign in the media….in order to cover up the AFL’s misdeeds and lead public opinion astray as to the real impact of AFL incompetence.
I accuse Channel 9 in their long-standing support of Rugby League of having violated the laws of “hording” the people’s game by consigning AFL north of the Murray to the Friday night TV “graveyard”.
I have but one goal: that Channel 9 be stripped of Friday night AFL, in the name of fans who have suffered so much and have the right to happiness and the enjoyment of their game at reasonable hours on a network that will undo such AFL stupidity.
And I close with the final accusation that cuts to the heart of this gross abuse of trust. How could the AFL prostitute its strongest night game schedule to a network that was already committed to protecting the vested TV interests of the AFL’s chief commercial rival?
(With full acknowledgment to the original prose of that great man of conscience Emile Zola)