His master’s voice has once again proclaimed “peace in our time, shortly” in the great Foxtel-Seven/Ten AFL TV war which is now a battle worthy of World War 1.
Unfortunately for the ‘mouth’ of News Ltd, Mark Day, his claim of an imminent peace isn’t shared universally. Seven and Ten say they haven’t been talking to Foxtel since the Pay TV mob tried to finesse a deal last week with a bit more ‘air’ in the shape of an offer of more ‘contra’.
His story in the Media section of today’s Australian reflects two things: the growing desire of his employers, News Ltd, to see a deal done, and the equal impatience of the AFL that the Pay TV deal is not done.
It is another attempt by News and the AFL to stampede Ten and Seven into doing a deal and fixing the brawl with Foxtel, which is being caused by James Packer’s refusal to allow the Pay TV operator to pay any more than $45 million in cash for rights to four weekly games.
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Ten and Seven want $60 million. Foxtel has grabbed the $5 million offered by Austar to try and move the deal along and is offering production costs and higher ‘contra’ to make the deal seem worth more than $70 million. That is all smoke and mirrors: the hard cash is $50 million and Foxtel/Austar are still $10 million short.
But the most interesting part of the story and of the stand off is the inability of News Ltd to get Packer and PBL to agree to offer more money.
This could be done through Foxtel or through Fox Sports (News and PBL control Fox Sports and its owners, Premier Media). Foxtel’s Kim Williams and Premier/Fox Sports, David Malone, know they can easily get the extra money back from lifting subscription fees for the AFL but that argument has fallen on deaf ears at PBL.
Hence this very interesting paragraph in this morning’s Mark Day story:
Observers believe Foxtel was under pressure to do a deal with the consortium. Austar was increasingly concerned that its subscribers would react strongly against the loss of AFL – a view shared by Foxtel co-owners News Limited (publisher of The Australian) and Telstra.
And this paragraph, outlining the AFL’s warning to Foxtel, which has been heeded by News:
It is understood the AFL also told Foxtel that if it abandoned AFL, or sought to set a new, lower floor price for future rights, it would not be in a strong position to negotiate in 2010, when the next agreement will be on the table.
And this one pinning the blame for the intransigence not on Seven and Ten but on James Packer. No wonder News outlets are bashing Nine and James Packer at the moment.
Two weeks ago the Foxtel contra offer was increased to $10 million a year. This was seen as a way of satisfying the demands of Foxtel part-owner James Packer, in that Foxtel did not pay Seven more than it had offered to pay Nine in its bid for AFL rights.
Where is General Haig when you need a good, mad, bloodletting rush across the trenches to win this battle?