NRL to seek millions in compensation from Foxtel after monster AFL deal

The NRL will seek tens of millions of dollars in compensation from broadcast partner Foxtel after the pay-TV giant struck a mammoth rights deal with the AFL last week.

Some clubs are under the impression the NRL has an ace up its sleeve that will allow them to return to the negotiation table with Foxtel for the seven-year deal it signed in 2020.

As reported by the Herald at the time of the renegotiated television deal, at the start of the COVID-19 pandemic, ARLC chairman Peter V’landys and NRL chief executive Andrew Abdo tried to include a “most-favoured” clause in its five-year extension with Foxtel.

It would have prohibited the pay television provider from striking a better deal with the AFL without compensating the NRL for the difference.

Foxtel rejected the NRL’s request, but the club's are under the impression that the governing body believes there was an understanding between the two parties to revisit the deal if the AFL’s deal gazumped that of rugby league. Foxtel did not respond to requests for comment. The NRL declined to comment.

The deals are difficult to compare. The AFL has an extra game each round. The AFL has also secured exclusive rights to all Saturday games in the first eight rounds, but in exchange will hand the Seven Network exclusive Thursday nights for the first 15 rounds from 2025.

The AFL’s new deal, which commences in 2025, is worth about $640 million annually.Credit:Getty

Whether Foxtel believes it is under any obligation to compensate the NRL is unclear. The pay television network paid around $200 million a season for the NRL when it renegotiated its rights deal two years ago.

Combined with the free-to-air deal with Nine Entertainment Co, the publishers of this masthead, New Zealand, international and radio rights, the total deal is approximately $400m per year.

The AFL’s deal with Foxtel and Seven is reportedly worth around $640m a year from 2025-2031. The Foxtel component of the deal is believed to make up about 60 per cent of that figure, or just under $400m.

Over the past week, V’landys and Abdo have been heavily criticised for leaving money on the table when they sat down with Foxtel, leaving some clubs seeing red.

Foxtel pays the NRL about $200 million a year under the agreement renegotiated at the height of the COVID-19 uncertainty.Credit:Getty

V’landys has assured them there is nothing to fear but won’t divulge the ace up his sleeve. V'landys declined to comment, describing discussions as "confidential".

The Herald has been told that ace is a perceived verbal agreement between the NRL and Foxtel chief executive Patrick Delany that the NRL’s willingness to do a deal at the height of COVID-19 uncertainty wouldn’t be forgotten.

V’landys indicated as much when he highlighted the dire predicament Foxtel found itself in when all of Australia’s sporting codes were forced to shut down two years ago, leaving Fox Sports without content to provide its paying subscribers.

“At the time, Fox needed an asset on its sheet to continue its viability. If we didn’t come into play, there’d be no Foxtel,” V’landys told the Herald last week.

“If Foxtel coughs, all the codes catch a cold. If you haven’t got them in play, the other parties won’t be paying as much as they should because you need competitive tension. When COVID-19 hit, they were the only ones. If they went under, there was no one else available.”

V’landys also recently went to war with the NSW government over a perceived verbal agreement to invest almost $800m into Sydney suburban grounds. But the government later decided to prioritise funding to the towns ripped apart by recent floods, much to the dismay of the ARLC chair.

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