Crikey Sports introduces Nick Tedeschi who writes for Punting Ace with his weekly From The Couch article  — “one of the most popular rugby league pieces anywhere.”

Punting Ace’s Nick Tedeschi writes:

Altruism is not a high priority for News Limited. They are in the business of making money. The vessels may be diverse, ranging from newspapers and satellite television to sports teams and restaurants, but the charter remains the same: make money. That mantra comes from Rupert Murdoch at the top and spills down throughout the entire empire, the message reaching even the most isolated outposts.

This, of course, makes News Limited’s continued involvement in the Melbourne Storm particularly interesting. The Melbourne Storm are solely owned by News Limited and have been since their inception, a bastard child of the Super League war manufactured from the remnants of the Western Reds and the Hunter Mariners to give rugby league the semblance of a national presence. At no point in the club’s 12-year history has the Storm even looked like breaking even with recent estimates suggesting News Limited has torn up somewhere in the vicinity of $70 million on propping up a rugby league team in AFL heartland.

One of the main sticking points to the removal of News from the ownership of the NRL, handing the game over to an independent commission, was the survival of the Melbourne Storm and a stream of excess funding from the game that would allow the team to continue on. News Limited puts nearly all of its annual $8 million payment from the NRL back into the Melbourne Storm and have sought to have the League provide $6 million a year for five years to ensure the club’s survival.

News Limited is obviously heavily invested in the Storm and in particular a rugby league presence in Melbourne. And their continual support suggests that while the Storm may not be making money directly for News, the greater organisation is benefiting financially from their existence. That is clear from News Limited’s willingness to sell out of the Storm but their insistence that the club survive. The most obvious link is the additional revenue Fox Sports accrues from advertisers by having a presence in Australia’s second largest television market.

There is no doubt that the existence of the Storm and rugby league Victoria is on the precipice after recent revelations that the club had been engaged in systematic salary cap rorting totalling over $1.7 million for at least five years. Former chief executive Brian Waldron has been labelled the “architect” and “chief rat” by News Limited management, claims which he hasn’t refuted to date but has suggested salary cap cheating was widespread in the game and that News representatives on the Storm board were aware of the Storm’s rorting.

Put simply, the Storm exists at the whim of News Limited. News Limited continues to fund the team because it provides a financial benefit to the company. If the short-term financial costs become too greater price to pay for the long-term financial benefits then News Limited will have no problem pulling the plug. News have committed to the Storm but that commitment will only last if the Storm brand isn’t damaged irreparably and if News are not found to be complicit, even passively so, to the shady and potentially illegal financial dealings of executives and the management team at the Melbourne Storm.

The Storm had built up a lot of credit publicly due to their on-field success. That has allowed them to survive such a heavy initial blow. There is not a lot in the savings account now, however, and the club will need to manage this crisis very carefully if they are to survive. News had want to escape with clean hands. If they don’t, those hands will be covered with the blood from the body that once was the Melbourne Storm.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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