The significant financial challenges facing the Australian Rugby Union will create considerable interest within the hierarchy of the Australian Football League and the National Rugby League, but for quite different reasons.
As the Brisbane Courier Mail headlined it today, “It’s ruck and ruin” when it comes to the financial state of the ARU, candidly outlined yesterday by the new CEO, John O’Neill.
In April the ARU will reveal an annual loss of around $8 million, and that’s despite a $7 million grant from the International Rugby Union. It is little wonder that the ARU, and it’s even more financially troubled New Zealand counterpart, have agreed on a Wallabies-All Blacks test match in Hong Kong, and are even considering one in Japan.
For the cashed up AFL, the news will surely encourage administrators to step up efforts to invade rugby heartland in NSW and Queensland, such as the private schools long dominated by rugby, and regional centres. It is also well placed to repel any further growth of rugby in Perth – and worry less (if if ever did worry) about expansion in Victoria.
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For the NRL the news is just as good. At a time when the downturn in poker machine revenue is hurting Sydney NRL clubs, the financial woes of the ARU mean that it is going to find it hard to entice NRL players to switch codes.
That will also have the effect of reducing pressure on NRL clubs to pay players more. For years player managers have been using offers from rugby union to extract higher payments from NRL clubs.
This year, only Timana Tahu has switched codes – and that was not about money, but his desire to try his hand at rugby. Ironically, he may end up being a far better buy than the other “stars” who switched codes for seven figure sums a few years ago.
And both codes can take some comfort from the knowledge that, skilful though he is, it will take John O’Neill some years to turn around the finances of the ARU.
Worse still, this year sees both the AFL and NRL gain the full financial benefit from their new free to air and pay television rights agreements. The timing of the ARU’s woes could not be better … for the other codes.
This summer has also confirmed that soccer is a threat that cannot be ignored. Even though the A League suffers from a lack of free to air match coverage, it is starting to draw some serious crowd numbers in Melbourne, Sydney and Brisbane … and getting good media coverage over the holidays. Soccer is starting to make a real impact where, over the longer term, it will hurt the other codes most of all – at the junior levels, especially in fast growing outer urban communities.
That is a real challenge all footy codes can ill afford to ignore.