Vlasnik
Kennel Legend
- Joined
- Nov 16, 2011
- Messages
- 10,442
- Reaction score
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No matter where you stand on the Israel Folau affair the intersection of his new contract talks with Rugby Australia’s latest annual report is timely.
It’s the perfect chance to see where the money is going in Australian rugby. Rugby Australia’s annual report tells us where and there are four main conclusions, none of which are particularly palatable.
First, RA is a top-heavy organisation; second, it is dangerously addicted to broadcast revenue; third, it is locked into a Super Rugby competition that is beginning to look like a burden; and fourth, the grassroots is still living on crumbs.
In fact, if you gave the money RA spends on Folau and Quade Cooper to community rugby, it would increase grassroots spending by more than 20 per cent, overnight.
That stark difference between the top of the game and those at the bottom is a theme that repeats all the way through the Rugby Australia reports.
Structurally, though, the most worrying aspect of RA’s finances are those that relate to Super Rugby, player costs and ‘‘corporate’’ expenditure versus the amount being brought in by broadcasting.
Take a deep breath. In 2017, RA spent $12m on ‘‘Super Rugby team costs’’, $27m on ‘‘Super Rugby funding’’ and $25m on ‘‘player payments and RUPA costs.’’ That’s a total of $64m.
However, it’s total broadcast take – by far the No.1 source of revenue – only amounted to $61m.
It gets worse. Much worse. RA also threw $1.3m to the ‘‘SANZAAR office,’’ spent another $8m on ‘‘High Performance and National Teams’’ and another $4m on ‘‘Marketing and Media’’.
There’s more. Rugby Australia also spent $17m on ‘‘Corporate’’ costs, described in the RA report as ‘‘all costs associated with the administration, legal, compliance . . . of running the business.’’
In other words, executive salaries and the like.
The amount given to ‘‘Community Rugby’’ was $3.7 million. A reminder at this stage that I am not aligned to club rugby in Sydney, never have been.
In fact, I have been an avowed supporter of Super Rugby. But the game is at a crucial juncture in Australia and you cannot look away at these numbers.
This report shows that people at the top of the business - players and administrators - are doing very nicely, thank you. Meanwhile, those are the bottom are not.
Separately, the costs associated with Super Rugby are beginning to look outrageous when you consider how the competition has alienated supporters in recent years.
At its current rate of spending, RA will spend $195m on ‘‘Super Rugby team costs’’ and ‘‘Super Rugby funding’’ over the next five years.
What makes those outlays particularly worrying is that RA already received a boost in broadcast revenue from the last TV deal.
Therefore, the capacity or desire from broadcasters, in Australia or overseas, to pump in enough money to generate a similar uplift in the next deal is limited.
Even the UK market – which gave SANZAAR such a boost in the last deal – has run out of steam.
This all leaves Rugby Australia in a precarious situation. For years the strategy has been to throw money at the top end, using a ‘star system’ in recruitment, and back the high-performance teams to generate the money to use elsewhere.
So when RA says, ‘‘We would love to spend more money on the grassroots but can’t,’’ it’s not strictly true.
More accurate would be to say, ‘‘We would like to spend more money on the grassroots but we’re choosing not to.’’
RA will say it has committed to spend another $1m on community rugby this year, but that still only matches the $1m it spent last year bringing home Wallabies from overseas (another little nugget of information contained in the report).
The approach has been ‘top down’ for years. RA has spent vast amounts of money on players and administrators, yet the Wallabies actually fell in the rankings last year.
It is also spending huge amounts of money on a Super Rugby competition that Australians appear to have lost touch with.
And in Folau’s case, they are about to spend a lot of money on a player who is endangering their second biggest source of revenue (sponsorships, $31m).
The house has been bet on the top of the Australian rugby pyramid, and it’s a wager that has rarely looked shakier.
It’s the perfect chance to see where the money is going in Australian rugby. Rugby Australia’s annual report tells us where and there are four main conclusions, none of which are particularly palatable.
First, RA is a top-heavy organisation; second, it is dangerously addicted to broadcast revenue; third, it is locked into a Super Rugby competition that is beginning to look like a burden; and fourth, the grassroots is still living on crumbs.
In fact, if you gave the money RA spends on Folau and Quade Cooper to community rugby, it would increase grassroots spending by more than 20 per cent, overnight.
That stark difference between the top of the game and those at the bottom is a theme that repeats all the way through the Rugby Australia reports.
Structurally, though, the most worrying aspect of RA’s finances are those that relate to Super Rugby, player costs and ‘‘corporate’’ expenditure versus the amount being brought in by broadcasting.
Take a deep breath. In 2017, RA spent $12m on ‘‘Super Rugby team costs’’, $27m on ‘‘Super Rugby funding’’ and $25m on ‘‘player payments and RUPA costs.’’ That’s a total of $64m.
However, it’s total broadcast take – by far the No.1 source of revenue – only amounted to $61m.
It gets worse. Much worse. RA also threw $1.3m to the ‘‘SANZAAR office,’’ spent another $8m on ‘‘High Performance and National Teams’’ and another $4m on ‘‘Marketing and Media’’.
There’s more. Rugby Australia also spent $17m on ‘‘Corporate’’ costs, described in the RA report as ‘‘all costs associated with the administration, legal, compliance . . . of running the business.’’
In other words, executive salaries and the like.
The amount given to ‘‘Community Rugby’’ was $3.7 million. A reminder at this stage that I am not aligned to club rugby in Sydney, never have been.
In fact, I have been an avowed supporter of Super Rugby. But the game is at a crucial juncture in Australia and you cannot look away at these numbers.
This report shows that people at the top of the business - players and administrators - are doing very nicely, thank you. Meanwhile, those are the bottom are not.
Separately, the costs associated with Super Rugby are beginning to look outrageous when you consider how the competition has alienated supporters in recent years.
At its current rate of spending, RA will spend $195m on ‘‘Super Rugby team costs’’ and ‘‘Super Rugby funding’’ over the next five years.
What makes those outlays particularly worrying is that RA already received a boost in broadcast revenue from the last TV deal.
Therefore, the capacity or desire from broadcasters, in Australia or overseas, to pump in enough money to generate a similar uplift in the next deal is limited.
Even the UK market – which gave SANZAAR such a boost in the last deal – has run out of steam.
This all leaves Rugby Australia in a precarious situation. For years the strategy has been to throw money at the top end, using a ‘star system’ in recruitment, and back the high-performance teams to generate the money to use elsewhere.
So when RA says, ‘‘We would love to spend more money on the grassroots but can’t,’’ it’s not strictly true.
More accurate would be to say, ‘‘We would like to spend more money on the grassroots but we’re choosing not to.’’
RA will say it has committed to spend another $1m on community rugby this year, but that still only matches the $1m it spent last year bringing home Wallabies from overseas (another little nugget of information contained in the report).
The approach has been ‘top down’ for years. RA has spent vast amounts of money on players and administrators, yet the Wallabies actually fell in the rankings last year.
It is also spending huge amounts of money on a Super Rugby competition that Australians appear to have lost touch with.
And in Folau’s case, they are about to spend a lot of money on a player who is endangering their second biggest source of revenue (sponsorships, $31m).
The house has been bet on the top of the Australian rugby pyramid, and it’s a wager that has rarely looked shakier.
