1 00:00:06,667 --> 00:00:10,547 Speaker 1: You're listening to the Weekend Sport podcast with Jason Vine 2 00:00:10,707 --> 00:00:11,747 Speaker 1: from Newstalk ZEDB. 3 00:00:12,827 --> 00:00:16,467 Speaker 2: With a major shakeup in the New Zealand sports broadcasting 4 00:00:16,907 --> 00:00:20,547 Speaker 2: landscape this week. On Tuesday it was announced that Sky 5 00:00:21,147 --> 00:00:25,027 Speaker 2: have purchased TV three, giving themselves a ready made free 6 00:00:25,027 --> 00:00:28,787 Speaker 2: to wear platform for some of their sports content. And 7 00:00:28,867 --> 00:00:32,067 Speaker 2: on Friday it was reported and this is not yet confirmed, 8 00:00:32,107 --> 00:00:35,067 Speaker 2: but it has been widely reported that TV and Z 9 00:00:35,787 --> 00:00:38,107 Speaker 2: have won the battle to screen next year's fee for 10 00:00:38,187 --> 00:00:42,187 Speaker 2: World Cup, fending off Sky in the battle for those rights, 11 00:00:42,307 --> 00:00:47,107 Speaker 2: and they will again reportedly screen a significant portion of 12 00:00:47,147 --> 00:00:49,467 Speaker 2: the one hundred and four matches that now happened at 13 00:00:49,467 --> 00:00:52,827 Speaker 2: a World Cup. Because it's forty eight teams, a significant 14 00:00:52,867 --> 00:00:55,867 Speaker 2: portion of those one hundred and four games will be 15 00:00:56,387 --> 00:00:59,947 Speaker 2: on a new paywalled digital platform that's going to be 16 00:01:00,027 --> 00:01:01,867 Speaker 2: up and running by the time the tournament kicks off 17 00:01:01,867 --> 00:01:05,227 Speaker 2: in June of next year. So in other words, you 18 00:01:05,307 --> 00:01:09,267 Speaker 2: will pay to see the entire tournament. You'll pay TV 19 00:01:09,427 --> 00:01:12,467 Speaker 2: and Z. They will obviously also have some free to 20 00:01:12,507 --> 00:01:16,987 Speaker 2: wear content, either on their main channels or streaming. The 21 00:01:17,027 --> 00:01:19,507 Speaker 2: new rugby deal, of course, is yet to be finalized, 22 00:01:20,187 --> 00:01:23,907 Speaker 2: although those discussions are well advanced apparently with an announcement 23 00:01:24,387 --> 00:01:27,427 Speaker 2: imminent that'll be skypicking those rights up again. It's just 24 00:01:27,467 --> 00:01:29,867 Speaker 2: a matter of the dollars and some of the finer detail. 25 00:01:30,267 --> 00:01:32,387 Speaker 2: So what will all of these changes mean for you 26 00:01:32,427 --> 00:01:35,667 Speaker 2: and I for the everyday sports viewer. For a bit 27 00:01:35,707 --> 00:01:39,867 Speaker 2: of analysis, let's bring in Colin Smith, Managing Director of 28 00:01:39,947 --> 00:01:45,267 Speaker 2: Global Media and Sports and founding director of Media Rights Value. 29 00:01:45,467 --> 00:01:50,067 Speaker 2: Colin is hugely experienced in the provision of strategic advice 30 00:01:50,227 --> 00:01:55,187 Speaker 2: and negotiation leadership on sports, media and competition structures. He 31 00:01:55,267 --> 00:01:59,867 Speaker 2: advises leading media companies and major professional sports in Australasia, 32 00:02:00,267 --> 00:02:03,627 Speaker 2: in Europe and across Asia as well. Colin, thanks for 33 00:02:03,707 --> 00:02:06,787 Speaker 2: joining us and lending us your expertise. Let's start with 34 00:02:06,907 --> 00:02:11,067 Speaker 2: Sky's purchase of TV three. How important is it for 35 00:02:11,147 --> 00:02:15,067 Speaker 2: a pay per view operator like Sky to have a 36 00:02:15,107 --> 00:02:16,547 Speaker 2: free to air platform like this? 37 00:02:18,347 --> 00:02:22,507 Speaker 3: Thank you a pleasure to talk to you. It's really 38 00:02:22,587 --> 00:02:27,347 Speaker 3: interesting and when we look at the New Zealand media market, 39 00:02:27,627 --> 00:02:31,507 Speaker 3: what we are now seeing is in essence the domination 40 00:02:31,787 --> 00:02:37,707 Speaker 3: by TV and Z on one side and both entering 41 00:02:37,867 --> 00:02:42,147 Speaker 3: into now behind the paywall and free to air, and 42 00:02:42,187 --> 00:02:48,187 Speaker 3: then with a Sky acquiring the rights from Warner Brothers 43 00:02:49,427 --> 00:02:52,827 Speaker 3: and having a free to wear and also additional streaming, 44 00:02:53,227 --> 00:02:58,547 Speaker 3: so you've got two powerful, formidable broadcasters now in New Zealand. 45 00:02:58,907 --> 00:03:00,907 Speaker 2: The free to air side of things is really interesting 46 00:03:00,947 --> 00:03:03,867 Speaker 2: to meet, Colin. Is it crucial for a company to 47 00:03:03,907 --> 00:03:08,387 Speaker 2: have free to wear, you know, ability because it allows 48 00:03:08,427 --> 00:03:12,067 Speaker 2: for advertising to be sold on that platform, or because 49 00:03:12,107 --> 00:03:14,947 Speaker 2: most sports now want a free to wear components in 50 00:03:14,987 --> 00:03:16,107 Speaker 2: their broadcast offering. 51 00:03:17,227 --> 00:03:20,547 Speaker 3: Well, it's a really good question, and the fundamental is 52 00:03:21,147 --> 00:03:24,747 Speaker 3: if you want to get mass viewership, free or area 53 00:03:24,907 --> 00:03:27,267 Speaker 3: is the way to go. But then if you want 54 00:03:27,307 --> 00:03:31,907 Speaker 3: to maximize your revenues, you want to be behind the paywall. 55 00:03:32,307 --> 00:03:38,067 Speaker 3: So a combination of free content plus behind the paywall 56 00:03:38,587 --> 00:03:45,307 Speaker 3: is highly successful and it maximizes both the viewership and 57 00:03:45,347 --> 00:03:47,187 Speaker 3: the revenues for the broadcaster. 58 00:03:47,507 --> 00:03:49,427 Speaker 2: It sounds so simple when you say that, Colin, it 59 00:03:49,507 --> 00:03:51,387 Speaker 2: sounds so simple. I'm not in my head, But it 60 00:03:51,427 --> 00:03:54,347 Speaker 2: seems to be a very hard balance to strike. What 61 00:03:54,387 --> 00:03:57,867 Speaker 2: are the conversations that go on around board tables at 62 00:03:57,867 --> 00:04:01,467 Speaker 2: both a broadcaster and a sports organization when these deals 63 00:04:01,467 --> 00:04:02,347 Speaker 2: are being put together. 64 00:04:04,587 --> 00:04:10,707 Speaker 3: It is a really a debate actually, because on one 65 00:04:10,747 --> 00:04:15,387 Speaker 3: side you need to make sure you've got the interests 66 00:04:15,427 --> 00:04:18,667 Speaker 3: from the viewers from the New Zealand viewers, so therefore 67 00:04:18,947 --> 00:04:22,627 Speaker 3: that has a compelling portion of free to wear. But 68 00:04:22,667 --> 00:04:27,347 Speaker 3: then in terms of maximizing the revenues for a sport 69 00:04:27,467 --> 00:04:31,747 Speaker 3: or a sports competition, then it needs to be behind 70 00:04:31,787 --> 00:04:36,907 Speaker 3: the paywall. It's frankly that simple, but that complicated as well, 71 00:04:37,107 --> 00:04:38,187 Speaker 3: and it is a trade off. 72 00:04:38,747 --> 00:04:42,867 Speaker 2: Do you think broadcasters care about a sports desire to 73 00:04:42,987 --> 00:04:47,027 Speaker 2: expose their sport to as wide an audience as possible 74 00:04:47,107 --> 00:04:50,387 Speaker 2: or does a broadcaster, a pay per view broadcaster simply 75 00:04:50,427 --> 00:04:53,547 Speaker 2: want if they head it their way, everything behind their paywall. 76 00:04:55,787 --> 00:05:03,347 Speaker 3: The answer is that most pay per view of broadcasters 77 00:05:03,387 --> 00:05:07,307 Speaker 3: would prefer to have as much content behind the paywall. 78 00:05:07,747 --> 00:05:11,667 Speaker 3: But the other part of this is to promote and 79 00:05:11,787 --> 00:05:15,987 Speaker 3: to keep on promoting that competition. Having a free to 80 00:05:16,147 --> 00:05:20,587 Speaker 3: air component is a win win, and you could argue say, 81 00:05:20,907 --> 00:05:25,227 Speaker 3: if we look at the New Zealand example of the 82 00:05:25,467 --> 00:05:30,627 Speaker 3: provincial rugby, being behind the paywall is probably cost it's 83 00:05:30,667 --> 00:05:34,787 Speaker 3: a lot of viewership and where now probably not an 84 00:05:34,787 --> 00:05:40,707 Speaker 3: attractive TV product for a pay TV operator. 85 00:05:41,707 --> 00:05:44,907 Speaker 2: In terms of the organization's the sporting organizations, do you 86 00:05:44,947 --> 00:05:48,227 Speaker 2: think they are now all totally cognizant colin of the 87 00:05:49,067 --> 00:05:50,987 Speaker 2: concept of free to wear that they have to have 88 00:05:51,067 --> 00:05:52,987 Speaker 2: some on free to wear. It's no good just taking 89 00:05:53,027 --> 00:05:55,307 Speaker 2: the money from the broadcaster. They have to have a 90 00:05:55,347 --> 00:05:58,307 Speaker 2: free to wear component in order to keep their sport exposed. 91 00:06:00,267 --> 00:06:03,907 Speaker 3: I would argue with you, yes, they do need a component, 92 00:06:04,987 --> 00:06:10,867 Speaker 3: but it doesn't if it's one game per week or 93 00:06:11,507 --> 00:06:16,827 Speaker 3: a premium game. Yes, but you want the major behind 94 00:06:16,867 --> 00:06:22,027 Speaker 3: the paywall to maximize a revenue for that sport. And frankly, 95 00:06:22,867 --> 00:06:26,147 Speaker 3: sixty to eighty percent of revenues for a sport come 96 00:06:26,267 --> 00:06:27,987 Speaker 3: from paid television. 97 00:06:28,387 --> 00:06:31,507 Speaker 2: It's an incredible amount, isn't it, and so crucial to 98 00:06:32,147 --> 00:06:35,627 Speaker 2: so many sports. The other piece of news this week 99 00:06:35,707 --> 00:06:38,347 Speaker 2: is TV and Z securing the rights to the FIFA 100 00:06:38,427 --> 00:06:41,387 Speaker 2: World Cup next year. They've got new technology coming to 101 00:06:41,547 --> 00:06:44,267 Speaker 2: charge for it as Sky do. Now how big a 102 00:06:44,307 --> 00:06:46,867 Speaker 2: play is this in your view? From TV and Z 103 00:06:47,067 --> 00:06:49,427 Speaker 2: our state broadcaster, it's. 104 00:06:49,547 --> 00:06:53,907 Speaker 3: Very significant and one of the interesting aspects about TV 105 00:06:54,027 --> 00:06:58,787 Speaker 3: and Z it is both a it is government owned, 106 00:06:58,787 --> 00:07:02,787 Speaker 3: but it's totally commercial as well, and it really dominates 107 00:07:02,827 --> 00:07:09,267 Speaker 3: the New Zealand market and then now entering into PATV 108 00:07:09,547 --> 00:07:15,067 Speaker 3: side makes it even more competitive and therefore more important 109 00:07:15,307 --> 00:07:20,267 Speaker 3: for Sky to have the acquisition of TV three. 110 00:07:20,347 --> 00:07:23,707 Speaker 2: Well indeed, and so you would expect that the acquisition 111 00:07:23,747 --> 00:07:27,827 Speaker 2: of TV three would naturally lead to Sky including that 112 00:07:27,907 --> 00:07:30,427 Speaker 2: as a free to air element on future broadcast deals 113 00:07:30,467 --> 00:07:31,427 Speaker 2: with any. 114 00:07:31,187 --> 00:07:38,987 Speaker 3: Code possibly and I could see that with rugby for sure, 115 00:07:39,587 --> 00:07:43,147 Speaker 3: and potentially you know, things like the Olympic if they 116 00:07:43,307 --> 00:07:47,067 Speaker 3: did for the Olympic Games or the Conwalk Games, I 117 00:07:47,067 --> 00:07:48,187 Speaker 3: could see that for sure. 118 00:07:48,947 --> 00:07:52,507 Speaker 2: How important to a broadcaster are marquee events like World 119 00:07:52,547 --> 00:07:56,867 Speaker 2: Cups Olympic Games compared to the regular content of a 120 00:07:56,947 --> 00:07:57,947 Speaker 2: sporting season. 121 00:08:00,307 --> 00:08:07,387 Speaker 3: For a pay television operator, the most important is the 122 00:08:07,387 --> 00:08:11,707 Speaker 3: the games, and it's not the pinnacle events, it's the 123 00:08:12,307 --> 00:08:16,107 Speaker 3: round by round. So in other words, the Super Rugby 124 00:08:16,587 --> 00:08:22,587 Speaker 3: or the NRL Games, they are really important. They attract 125 00:08:22,787 --> 00:08:28,827 Speaker 3: consistent viewership and therefore consistent subscribers. In terms of the 126 00:08:28,867 --> 00:08:33,467 Speaker 3: premium events like the Olympic Games or the Pink World Cup, 127 00:08:35,307 --> 00:08:39,947 Speaker 3: generally they are globally in front of the paywall, as 128 00:08:39,947 --> 00:08:45,227 Speaker 3: opposed behind the paywall. But you can see that changing 129 00:08:45,627 --> 00:08:50,027 Speaker 3: where some sport will be behind the paywall and some 130 00:08:50,267 --> 00:08:53,227 Speaker 3: sport leading sport will be in front of the paywall. 131 00:08:53,787 --> 00:08:55,707 Speaker 2: So it makes sense, It does make sense, It makes 132 00:08:55,707 --> 00:08:58,267 Speaker 2: perfect sense. I wonder what the feeling will be at 133 00:08:58,347 --> 00:09:01,867 Speaker 2: Sky having not acquired the FIFA World Cup next year. 134 00:09:01,907 --> 00:09:03,547 Speaker 2: How much of a blow is that to them, or 135 00:09:04,027 --> 00:09:06,827 Speaker 2: as you've just outlined, are they more interested in content 136 00:09:06,867 --> 00:09:10,547 Speaker 2: that's provided by a regular season that goes across many months. 137 00:09:12,107 --> 00:09:17,827 Speaker 3: I think FIFA World Cup is a one off and 138 00:09:18,387 --> 00:09:22,867 Speaker 3: football generally is not as strong in New Zealand or 139 00:09:22,907 --> 00:09:27,547 Speaker 3: for that matter, in Australia, and so therefore what is 140 00:09:27,587 --> 00:09:33,707 Speaker 3: really important with New Zealand being close to being in 141 00:09:33,747 --> 00:09:38,147 Speaker 3: its winter code, being a one sport nation or historically 142 00:09:38,187 --> 00:09:44,387 Speaker 3: a one sport nation with rugby and growing with NRL, 143 00:09:45,307 --> 00:09:49,907 Speaker 3: it's therefore it's those regular games that is important. 144 00:09:50,587 --> 00:09:53,427 Speaker 2: We're still yet to have the official announcement of Sky 145 00:09:53,507 --> 00:09:55,947 Speaker 2: in New Zealand Rugby's new broadcast deal. It runs out 146 00:09:55,987 --> 00:09:57,867 Speaker 2: as you know, at the end of this year. We're 147 00:09:57,867 --> 00:10:00,947 Speaker 2: told it's imminent. What do you think the sticking points 148 00:10:00,987 --> 00:10:03,147 Speaker 2: would be, you know, right at the end when they're 149 00:10:03,147 --> 00:10:05,707 Speaker 2: just trying to nut out the final nuts and bolts 150 00:10:05,707 --> 00:10:06,227 Speaker 2: of their deal. 151 00:10:07,787 --> 00:10:10,947 Speaker 3: I think there would be two parts of this. Of course, 152 00:10:10,987 --> 00:10:15,067 Speaker 3: it's going to be how many New Zealand dollars millions 153 00:10:15,067 --> 00:10:19,707 Speaker 3: of dollars are they're paying per year and whether it's 154 00:10:20,187 --> 00:10:23,107 Speaker 3: the same amount as the previous deal and I'd say 155 00:10:23,147 --> 00:10:26,347 Speaker 3: that's unlikely, and I think it will be lower, but 156 00:10:26,667 --> 00:10:30,107 Speaker 3: you never know. And the other part of that is 157 00:10:30,187 --> 00:10:34,827 Speaker 3: to ensure what's the future of super rugby and how 158 00:10:34,867 --> 00:10:40,747 Speaker 3: does that continue to thrive when it's got its challenges. 159 00:10:41,347 --> 00:10:44,227 Speaker 2: In general terms, Colin zoom out of it from this, 160 00:10:44,787 --> 00:10:49,947 Speaker 2: how would you describe the global sports rights landscape right now? 161 00:10:51,467 --> 00:10:56,067 Speaker 3: Well, it's over the last twenty years it's boomed and 162 00:10:56,107 --> 00:11:01,587 Speaker 3: that's been huge for the funding of professional sport globally. 163 00:11:03,227 --> 00:11:11,587 Speaker 3: Now with the advent of streaming and many streamers, we're 164 00:11:11,587 --> 00:11:17,267 Speaker 3: getting to a timeline when the values of rights will 165 00:11:17,307 --> 00:11:21,507 Speaker 3: not increase so dramatically as they have in the last 166 00:11:21,547 --> 00:11:27,227 Speaker 3: twenty years. And you can see that's happened already in 167 00:11:27,627 --> 00:11:32,387 Speaker 3: the French league, which is a football league one, and 168 00:11:32,387 --> 00:11:36,027 Speaker 3: it's going to be increasing the case globally. The two 169 00:11:36,107 --> 00:11:41,867 Speaker 3: exceptions so that have been the NFL, you know, earn 170 00:11:42,187 --> 00:11:46,027 Speaker 3: thirteen billion US dollars a year and now the latest 171 00:11:46,027 --> 00:11:50,947 Speaker 3: deal with the NBL, the NBA. Sure, I say in 172 00:11:50,987 --> 00:11:56,027 Speaker 3: the United States that's a deal of seventy six billion 173 00:11:56,147 --> 00:12:00,627 Speaker 3: US dollar. But they are massive with massive markets. But 174 00:12:00,747 --> 00:12:07,467 Speaker 3: I continuing to the same extent, and they are the 175 00:12:07,547 --> 00:12:11,627 Speaker 3: other challenge that brought us them. A view of gen 176 00:12:11,787 --> 00:12:16,907 Speaker 3: Z the younger viewers is less. They're not holding them 177 00:12:17,067 --> 00:12:20,267 Speaker 3: for an entire game, and how they address that is 178 00:12:20,307 --> 00:12:23,267 Speaker 3: a real is an issue they need to consider. 179 00:12:23,667 --> 00:12:27,107 Speaker 2: Indeed, and just on the fact that there was a 180 00:12:27,147 --> 00:12:29,907 Speaker 2: downward trend or certainly it's a plantau of anything, is 181 00:12:29,947 --> 00:12:32,387 Speaker 2: it like the housing market, Colin might go up again, 182 00:12:32,507 --> 00:12:34,827 Speaker 2: or is the downward trend likely to continue now? 183 00:12:36,067 --> 00:12:40,347 Speaker 3: I think my view is it's starting to too close 184 00:12:40,387 --> 00:12:45,707 Speaker 3: to being max out unless they reattract gen Z in 185 00:12:46,147 --> 00:12:50,667 Speaker 3: and they come back into They follow sports significantly in 186 00:12:50,747 --> 00:12:54,867 Speaker 3: the professional sports, but they don't stay for entire games, 187 00:12:55,347 --> 00:13:02,467 Speaker 3: and therefore if they don't subscribe to the paywalls broadcasters 188 00:13:03,147 --> 00:13:07,707 Speaker 3: or don't watch them free to air and therefore to advertisers, 189 00:13:08,147 --> 00:13:12,667 Speaker 3: that means the revenue is flowing in to broadcasters because 190 00:13:12,667 --> 00:13:16,747 Speaker 3: of sports content is an issue, even though sport is 191 00:13:16,787 --> 00:13:21,067 Speaker 3: one of the premium products of broadcast globally, And. 192 00:13:21,147 --> 00:13:25,147 Speaker 2: Just back to the revenue that broadcast money provides, the 193 00:13:25,467 --> 00:13:29,107 Speaker 2: sporting organizations. You mentioned the sort of sixty seventy maybe 194 00:13:29,107 --> 00:13:32,587 Speaker 2: even upwards of that for some sports. Do you see 195 00:13:32,627 --> 00:13:35,347 Speaker 2: that going down? Will sporting organizations need to look at 196 00:13:35,387 --> 00:13:39,147 Speaker 2: other other revenue streams, better sponsorship deal, better ticketing and merchandise, 197 00:13:39,227 --> 00:13:39,827 Speaker 2: that sort of thing. 198 00:13:43,147 --> 00:13:47,547 Speaker 3: Well, the interesting part of sponsorship revenue is really driven 199 00:13:47,787 --> 00:13:51,067 Speaker 3: because of broadcasts. Yes, it's not driven, it's not driven 200 00:13:51,147 --> 00:13:55,067 Speaker 3: by attendance as of games. The challenge, I think the 201 00:13:55,227 --> 00:14:01,987 Speaker 3: challenge is that that percentage I don't think will change. 202 00:14:02,707 --> 00:14:06,987 Speaker 3: There could be some more sponsorship, the issue of sports 203 00:14:07,067 --> 00:14:11,547 Speaker 3: bedding could increase, but that's got some real issues socially, 204 00:14:12,027 --> 00:14:15,787 Speaker 3: and I think that's on both sides of the ditch, 205 00:14:16,547 --> 00:14:19,707 Speaker 3: and so that's I don't think necessarily that's going to 206 00:14:19,747 --> 00:14:30,427 Speaker 3: grow without some government interventions or constraints. And I think 207 00:14:30,467 --> 00:14:35,027 Speaker 3: what's going to happen is the costs of these sports 208 00:14:35,107 --> 00:14:41,027 Speaker 3: leagues where we will need to be addressed going forward 209 00:14:41,067 --> 00:14:42,427 Speaker 3: as well. 210 00:14:42,467 --> 00:14:44,907 Speaker 2: Colin, you've given us tremendous insight. Thank you so much 211 00:14:44,907 --> 00:14:46,987 Speaker 2: for joining us this afternoon with your expertise. I really 212 00:14:47,027 --> 00:14:47,627 Speaker 2: appreciate your. 213 00:14:47,587 --> 00:14:49,027 Speaker 3: Time, absolute pleasure. 214 00:14:49,267 --> 00:14:52,827 Speaker 2: Thank you for joining us, Colin sports broadcasting expert Colin Smith. 215 00:14:52,547 --> 00:14:56,427 Speaker 1: There for more from Weekend Sport with Jason Fine. Listen 216 00:14:56,507 --> 00:15:00,107 Speaker 1: live to news Talks b weekends from midday, or follow 217 00:15:00,147 --> 00:15:01,787 Speaker 1: the podcast on iHeartRadio