Foxtel, Seven closing on cricket broadcast deal

Foxtel, News Corp and Seven are closing on a status quo broadcast rights deal with Cricket Australia under which highest bidder Paramount will be left out in the cold in much the same way as happened with the AFL rights earlier this year.

Barring a late change of heart, Paramount and Ten’s offer of around $1.5 billion over seven years is set to be ignored by CA, with Foxtel and Seven to retain the rights. Sources with knowledge of negotiations estimated a fee worth about $1.4 billion was likely.

This would work out to fees of around $210 million per year, compared to the $197 million agreed by Foxtel and Seven with CA at the start of their last deal in 2018.

A small uplift in rights at a time of considerable inflation may push cricket closer to the privatisation of part of its operations in order to raise more capital.

Interested parties were expecting an imminent announcement of the broadcast deal from CA, more than likely in the new year once key executives return home from Christmas holidays.

Foxtel, Seven and Paramount all declined to comment.

Seven will retain the free-to-air portion of the rights – with digital rights for Seven Plus added in the same manner as its part of the AFL deal – despite conducting a public and legal campaign against CA over their current arrangement for the past three years. As part of the pitch to CA, Seven promised to drop current legal action if their deal was renewed.

The Big Bash League is set to be reduced in size, most likely to 10 games per team plus a final series, after audiences for the tournament trended down over the past five years – including the final year of the previous deal with Ten.

Seven had expressed interest in gaining the rights to men’s white-ball internationals, which Foxtel had gained exclusively in 2018 amid a changing political climate in which the federal Labor government has pushed for tighter adherence to anti-siphoning legislation.

“Our media laws must encourage innovation without locking iconic sports behind a paywall and leaving some Australians behind,” communications minister Michelle Rowland said after the AFL’s deal was unveiled. “Australians should have the chance to enjoy iconic sporting events live and free, regardless of where they live and what they earn.”

CA’s initial courting of Paramount and Ten, followed by talks with Nine (owner of this masthead) in recent weeks, appeared to be headed off by fears, played upon by Seven and Foxtel, that Australia’s third commercial network was not a safe bet in terms of audience size.

The AFL made a similar calculation in sticking with Foxtel and Seven, albeit after being able to wring extra cash out of its incumbent partners by making a public show of discussions with Paramount in the United States.

Paramount offered the AFL $6 billion over 10 years, before the league reached terms with Foxtel and Seven worth $4.5 billion over seven years instead.

CA’s broadcast rights advisory group has been headed by the board director Richard Freudenstein, a paid director of the News Corp company REA, earning $242,000 in the role last year according to annual reports.

A motivating factor for CA in its 2018 negotiations – when Seven beat Ten to the free-to-air rights by a mere $2 million a season – was to enter into a partnership with News Corp that increased its coverage of the summer game.

Nine’s ability to compete for the free-to-air rights diminished after the network beat Seven to reach terms to cover the Olympics last week, a $300 million deal that will complement its existing rights to the Australian Open tennis each January.

CA’s chief executive Nick Hockley said on Tuesday that the broadcast rights deal was close to completion.

“What I will say is discussions are progressing very well and hopefully we’ll have some announcements to be made in the not too distant future,” Hockley said on SEN Radio. “We’re working to do the best deal we can in the best interests of Australian cricket and there’s a lot to work through. There’s no fixed timeline, but discussions are progressing well.

“We’ve had really strong interest throughout the process from all parties. The spirit of the discussions is reflective of the fact that it’s our national sport, our only truly national and international sport, and I think Boxing Day, there’s no better picture to demonstrate that.

“Like all sports, there’s competing interests for people’s time, and the main thing is we just want to see kids picking up a bat and ball, and they’re the fans of the future.” Sydney Morning Herald