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3 year Sky deal for less than current deal


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Its good that you have considered all the salient points on this, loaded with all the information (even though there actually isnt any as of yet) and came to this opinion. Well done you.

I'm not clicking on a Mail link - can anyone summarise what it says about BT interest?

Once again the Nigel Wood £40m/year deal from 2014 looks like a brilliant piece of business. I'm glad he gets the recognition he deserves from grateful fans of the game.

5 minutes ago, Smudger06 said:

Whilst you have been making a lot of sense recently Michael, I think you put too much importance on the advertising part of Sky's Business model. Subs are King. Ads are just a bonus on the side for them. 

I totally get that advertising is a pretty small line item in the context of subscriptions, but it is a line item regardless. 

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3 hours ago, DoubleD said:

I don't disagree, and the clubs certainly have to take some blame for that.

No doubt some clubs are also realising this, hence the talk about whether they should be reverting to 1 body.

However, it still doesn't change the fact that this was one of Elstone's KPIs when he came in. He has been in 2 and a half years, and as he stressed on his appointment about the split creating accountability, he will be judged on this and if the reports are true then it is a metric he has failed on

But a KPI is fairly meaningless if it is set up to fail to begin with. Elstone may be many things, but a magician he ain't. 

Edited by whatmichaelsays
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15 minutes ago, whatmichaelsays said:

For me, the million dollar (or £10m) question is if, and to what extent, Super League has been able to 'move the needle' on the audience that it offers Sky (or any other broadcaster). 

Sky knows what a rugby league supporter is worth to them - they have a good idea of how much RL content is watched and they have a good idea how many subscriptions rely on RL. 

They also know how much an RL supporter is worth to advertisers. They've invested millions into programmatic advertising and other forms of Ad Tech to make their advertising services more valuable. It's why Sky is happy to bet big on content like F1 and golf but it's also why different demographics watching the same content are important - because now, two households watching the same programme at the same time can see very different adverts depending on the data Sky holds on them. 

So, when we talk about "adding value", we're primarily talking about whether Super League has been able to broaden it's audience in a way that measures favourably against those points. I know we had a discussion on a previous thread about this, but it's why arguments over "my away following is bigger than your away following" massively miss the bigger picture. 

Has the sport broadened it's appeal so that more TV subs rely on RL, and has it broadened it's appeal to the audiences that advertisers will pay a premium for? If it has, the game can argue for a better TV deal. If it hasn't, then it can't. That's not an issue of geography or of glamorous cities - it's an issue of how the game has changed the demand for RL content, who is demanding it and how they're satisfying that demand. 

But that does then bring me back to the question of what good work did RL do to achieve the record deal last time? And 'get lucky' can't be the answer. 

And what did the Premier League not do this time that saw them get a lower deal?

I agree with the principal of what you  are saying, and I do think widening of the audience with a particular focus on more affluent markets would add value, but I'm not sure how much the game is going to be able to 'move the needle' to such a level that we are going to see tens of millions added to a tv deal - I actually think there is probably a series of tactical changes that will add more value, which will also support meeting needs of wider audiences over the coming years, but I think that is a long-term development. 

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1 minute ago, whatmichaelsays said:

But a KPI is fairly meaningless if it is set up to fail to being with. Elstone may be many things, but a magician he ain't. 

It doesn't change the fact that he came in 2.5 years ago, promising to change the commercial landscape, generating untapped value. If the reports of the new tv deal are correct, then he has failed this metric, Betfred deal aside.

He may still gain enough support from SL execs to remain in position despite this

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1 minute ago, Dave T said:

But that does then bring me back to the question of what good work did RL do to achieve the record deal last time? And 'get lucky' can't be the answer. 

And what did the Premier League not do this time that saw them get a lower deal?

I agree with the principal of what you  are saying, and I do think widening of the audience with a particular focus on more affluent markets would add value, but I'm not sure how much the game is going to be able to 'move the needle' to such a level that we are going to see tens of millions added to a tv deal - I actually think there is probably a series of tactical changes that will add more value, which will also support meeting needs of wider audiences over the coming years, but I think that is a long-term development. 

We proposed a whole game structure that looked attractive and promised that for once we would stick to it? We let them down.   

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2 minutes ago, Smudger06 said:

We proposed a whole game structure that looked attractive and promised that for once we would stick to it? We let them down.   

The customers didn't like it in sufficient numbers ultimately. Knowing when to confine something to history is important. 

And I say that as somebody who enjoyed the 8's.

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Just now, Smudger06 said:

I must admit the 8's outside of the middle, MPG comp, i.e SL8's and Champ Shield 8's were a right drag on but minor tweaks would have been the order of the day not SL trying to split and grab more power, and not replacing them with an even worse Loop fixture solution.  

The enjoyable part of that structure was the middle 8's - or inter-division playoffs. That was the takeaway from that structure. 

But as is often the case in RL, if fans don't like a certain thing, no matter how small, they will make a hell of a lot f noise about it to anyone who will listen, happy to trash the game.

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1 minute ago, Dave T said:

The customers didn't like it in sufficient numbers ultimately. Knowing when to confine something to history is important. 

And I say that as somebody who enjoyed the 8's.

Very true but it looked good on paper when if was first announced and it unified the game substantially with provision for growth at League 1 level. It must have looked very good to Sky too. We Should have presented a unified front to the public and our TV Partners, we gave them cold feet and we gave them loop fixtures as an alternative, grave errors. especially public spats. 

 

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3 minutes ago, Dave T said:

The enjoyable part of that structure was the middle 8's - or inter-division playoffs. That was the takeaway from that structure. 

But as is often the case in RL, if fans don't like a certain thing, no matter how small, they will make a hell of a lot f noise about it to anyone who will listen, happy to trash the game.

Yes, unfortunately I fell into that trap, I see the system for what it tried to do now. 

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So BT entered the fray, and gave Sky some competition,  if only nominally and the price went down! I thought competition meant the seller could get a better deal. Perhaps BT equalled Sky's bid so Sky upped it a bit. But getting competition for your rights and getting a lower deal is worrying.  Dave T asked why the Premier league got a bit less from Sky, relatively speaking of course,  3.2 billion to 3 billion is no hardship,  is because the EPL under Scudamore had the bright notion of offering a package that suited Amazon,  so overall they didn't lose out. Why couldn't SL on learning of BT's interest offer them a small package,  Sky may have reduced their offer to 27m a year perhaps but BT might have paid 5m to get some games.

What was in Elstone's in tray other than sell the game and get at least another partner for SL. Perhaps that announcement is still to come,  but somehow I doubt it.

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We have 3 years to sort ourselves out now. Needs to be done right, for once. BT coming in is a positive to take away, it was speculated as a £25m - £30m deal initially, would have gone like this.......Sky £25m, (Sky sat thinking nice1) .......BT pop up late with £28m ??? Sky (FFS) £30m. BT, we are out but never mind we gave it a go and at least we've made our competitor pay more.....in a nutshell, perhaps.  

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2 minutes ago, HawkMan said:

 I thought competition meant the seller could get a better deal.

You didn't believe that old tosh from selling public stuff to private companies did you?

I do like the amount of engagement and involvement this process is good for the game.

" .......means always being with the oppressed and never the oppressors."-- Marek Edelman

 

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11 minutes ago, Smudger06 said:

We have 3 years to sort ourselves out now. Needs to be done right, for once. BT coming in is a positive to take away, it was speculated as a £25m - £30m deal initially, would have gone like this.......Sky £25m, (Sky sat thinking nice1) .......BT pop up late with £28m ??? Sky (FFS) £30m. BT, we are out but never mind we gave it a go and at least we've made our competitor pay more.....in a nutshell, perhaps.  

Indeed, this is ultimately it - and there are so many unknowns we are just speculating. Maybe we squeezed every penny out of this negotiation from the starting point.

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28 minutes ago, HawkMan said:

So BT entered the fray, and gave Sky some competition,  if only nominally and the price went down! I thought competition meant the seller could get a better deal. Perhaps BT equalled Sky's bid so Sky upped it a bit. But getting competition for your rights and getting a lower deal is worrying.  Dave T asked why the Premier league got a bit less from Sky, relatively speaking of course,  3.2 billion to 3 billion is no hardship,  is because the EPL under Scudamore had the bright notion of offering a package that suited Amazon,  so overall they didn't lose out. Why couldn't SL on learning of BT's interest offer them a small package,  Sky may have reduced their offer to 27m a year perhaps but BT might have paid 5m to get some games.

What was in Elstone's in tray other than sell the game and get at least another partner for SL. Perhaps that announcement is still to come,  but somehow I doubt it.

My understanding is that the Premier League did get a real reduction in value, as their final packages sold to BT and Amazon did not reach the value they wanted. 

So for all the talk of the changing landscape, the rights pretty much went to the two big players and Amazon picked up a few cheap games and the total value went down.

Edited by Dave T
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50 minutes ago, Dave T said:

But that does then bring me back to the question of what good work did RL do to achieve the record deal last time? And 'get lucky' can't be the answer. 

And what did the Premier League not do this time that saw them get a lower deal?

I agree with the principal of what you  are saying, and I do think widening of the audience with a particular focus on more affluent markets would add value, but I'm not sure how much the game is going to be able to 'move the needle' to such a level that we are going to see tens of millions added to a tv deal - I actually think there is probably a series of tactical changes that will add more value, which will also support meeting needs of wider audiences over the coming years, but I think that is a long-term development. 

I do think that timing was in the game's favour at the signing of the last TV deal. That doesn't necessarily mean that the game "got lucky", but the deal was struck at a time where Sky had lost some of it's prominent sports rights and it was looking for some good news to stuff in the shareholder's report (I seem to recall that the renewal discussions were brought forwards at Sky's behest?). 

Similarly, I would suggest that the Premier League's reduction was the result of the market somewhat correcting itself - I think most would agree that TV rights values had got out of hand (especially where football was concerned) at one point. 

So does this deal, if we take the Daily Heil report at face value, represent a good deal? Quite possibly, given the market conditions. But my issue was more about this notion that some in the game seem to have that RL TV rights are always undervalued, that Wood signed the agreement too hastily (despite having the blessing of the clubs - even the top ones - at the time) and that it needed a better salesman / negotiator to "put it to Sky". I didn't see that view personally and my argument was that if Super League was ever going to increase it's revenue from TV, simply stamping it's feet and arguing "you underpaid us last time" isn't enough. I wouldn't expect the value of my house to go up in the middle of a recession unless I did something worthwhile to improve it's value, and the same applies here. 

Edited by whatmichaelsays
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4 minutes ago, Dave T said:

My understanding is that the Premier League did get a real reduction in value, as their final packages sold to BT and Amazon did not reach the value they wanted. 

So for all the talk of the changing landscape, the rights pretty much went to the two big players and Amazon picked up a few cheap games and the total value went down.

The total domestic rights value Dave. The increase in international rights made this slight problem go away though.  

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If the deal was only initially worth £x million but Elstone managed to get £y million which is greater than £x million albeit less than the current deal due to the prevailing market and economic outlook isn’t that a success for him?
 

Just saying the potential new deal is for less money therefore it is a failure is too simplistic an argument but there again certain individuals will use anything to bash Elstone who may or may not be doing a very good job

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Just now, Smudger06 said:

The total domestic rights value Dave. The increase in international rights made this slight problem go away though.  

Yes, in my original post I did qualify that this was domestic we were talking to.  I know all the talk was around the international rights increasing to cover any shortfall, but I don't think I followed what they eventually sold for, apart from the fact that the China deal has recently fallen through.

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4 minutes ago, whatmichaelsays said:

I do think that timing was in the game's favour at the signing of the last TV deal. That doesn't necessarily mean that the game "got lucky", but the deal was struck at a time where Sky had lost some of it's prominent sports rights and it was looking for some good news to stuff in the shareholder's report (I seem to recall that the renewal discussions were brought forwards at Sky's behest?). 

Similarly, I would suggest that the Premier League's reduction was the result of the market somewhat correcting itself - I think most would agree that TV rights values had got out of hand (especially where football was concerned) at one point. 

So does this deal, if we take the Daily Heil report at face value, represent a good deal? Quite possibly, given the market conditions. But my issue was more about this notion that some in the game seem to have that RL TV rights are always undervalued, that Wood signed the agreement too hastily (despite having the blessing of the clubs - even the top ones - at the time) and that it needed a better salesman / negotiator to "put it to Sky". I didn't see that view personally and my argument was that if Super League was ever going to increase it's revenue from TV, simply stamping it's feet and arguing "you underpaid us last time" isn't enough. I wouldn't expect the value of my house to go up in the middle of a recession unless I did something worthwhile to improve it's value, and the same applies here. 

Don't disagree with much of that, and as per the point about PremLeague rights being lower due to a market correction, maybe this is exactly the same with RL, coupled with the fact that the world is falling apart!

Personally I think a 3 year deal is a decent result, providing the value allows for us to consolidate and get through what had the potential to be a crippling period for the game. This could mean that in 4 years we would be looking to negotiate following a massively successful World Cup, and potentially a PE deal which could see a strategic change, potentially investment in things like broadcasting infrastructure- I think this is where we will see if Elstone is any good. 

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8 minutes ago, LeeF said:

but there again certain individuals will use anything to bash Elstone who may or may not be doing a very good job

Just thought this deserved repetition.

" .......means always being with the oppressed and never the oppressors."-- Marek Edelman

 

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1 hour ago, whatmichaelsays said:

So, when we talk about "adding value", we're primarily talking about whether Super League has been able to broaden it's audience in a way that measures favourably against those points. I know we had a discussion on a previous thread about this, but it's why arguments over "my away following is bigger than your away following" massively miss the bigger picture. 

Has the sport broadened it's appeal so that more TV subs rely on RL, and has it broadened it's appeal to the audiences that advertisers will pay a premium for? If it has, the game can argue for a better TV deal. If it hasn't, then it can't. That's not an issue of geography or of glamorous cities - it's an issue of how the game has changed the demand for RL content, who is demanding it and how they're satisfying that demand. 

Perfectly put.

Newham Dockers - Champions 2013. Rugby League For East London. 100% Cockney Rugby League!

Twitter: @NewhamDockersRL - Get following!

www.newhamdockers.co.uk

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Its perfectly possible that Elstone has rescued a poor deal and averted disaster. What if...Sky did their sums and decided that they were going to offer substantially less than last time because subscription and advertising revenues were less than expected and production costs were higher than expected?  In addition, what if  they had become fed up of fans phoning them up and cancelling and also using social media to and forums like this criticise the match day teams?

Edited by JohnM

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I hope whatever the final financial figures, more games will be filmed and  broadcast to network standard, either as part of the main package or some sort of Gamepass style extra subscription service. 

In this day and age inventory for broadcasters/vod is important and we're not making the most of what we have. 

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