The AFL television rights story is one of those great issues
that
spans
business, politics, media and sport. Talkback has been buzzing and
given
the
vested interests of so many players, we’re enjoying much of the
commentary
and
speculation. We particularly liked Mark Day’s piece in The Australian (Seven grab means game on) which strongly pushed the News Ltd line about the importance
of
newspaper
coverage to the AFL. Day even claimed Seven shares would rise $2
if
they
stopped suing the world over Foxtel, something that will have to
be
settled as
part of this new television rights contract.

The Age had an interesting business feature today and go here for a good wrap of what the financial analysts think. The new
revelations
in
today’s papers are that Ten has paid Seven $10 million to buy
into its
“first
and last” right, and the networks intend to alternate the
finals, which
are
estimated to provide about 25% of all AFL advertising revenue.

It’s hard to think of a more dramatic melting polt to unfold over
the
coming
months, and the Federal Government will play a bigger role than
many
people
realise through its unfettered control of the anti-siphoning
list,
media
deregulation and the drive to maximise the sale price of Telstra.

We all know that Foxtel is a mess and the shareholders are
fighting
amongst
themselves yet again as losses blow out to $100 million in the
latest
half,
thanks to the digital conversion.

As
50% Foxtel shareholder, Telstra is bleeding. But the taxpayer
has
other
sporting rights exposure through the telco’s sponsorship of
Telstra
Dome
in
Melbourne and Telstra Stadium in Sydney, the millions Telstra
has
thrown at the
AFL for the internet rights, and the tens of
millions
thrown
into NRL
sponsorship.

Surely Telstra just can’t sit back and let Seven and Ten grab
the
free-to-air
rights because Nine simply can’t offer the live coverage into
NSW
and
Queensland on Friday night and Sunday afternoon. Telstra needs to find
a
new
chief executive quickly who can play in this paddock.

The other very interested observer would be John Fairfax, which
prides
itself
on independent coverage, unlike News Ltd which is contracted to
provide
a
certain amount of coverage of AFL matters in its newspapers across
the
country.
Remember that Age advertising slogan, “Not the official AFL paper.”

But if Seven and Ten win the rights and the Fairfax board proceeds
with
its
plan to merge with the Ten Network, if or when media ownership
is
deregulated,
this would leave the supposedly independent quality
newspaper
company joined at
the hip with a major commercial partner of the AFL.

The debate about media ownership will be long and passionate over
the
coming
months, and as the only senior cabinet minister left from
Victoria,
passionate
Essendon supporter Peter Costello will need to keep a
close eye on
proceedings.
So too will Graeme Samuel, the former AFL
commissioner who drove
the rights
negotiations last time, who now aspires to
become the chief
competition
regulator of our media, wearing his ACCC
chairman’s hat.

Seven shares rose after Wednesday’s announcement, but there has
been
some
rebalancing this morning as PBL gained 21c to $15.59, Ten rose 3c to
$3.77
and
Seven lost 7c to $7.59.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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