When promotion/relegation comes in, how much should a licence cost?


When promotion/relegation comes in, how much should a licence cost?

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MarkfromCroydon
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It now seems there is so much momentum that promotion/expansion, and eventually relegation will come into the A League. What I'm wondering is how much should the fee be and how much will the fee be for teams to gain entry to the top tier? If I was running one of the current A League clubs, I would be expecting a fee of $5 million with the bulk of that to be distributed between the existing clubs.
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$0

That's the whole point.
aussie scott21
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Why wouldnt you just say self funded for their first 2 seasons?
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Waz - 29 Jun 2017 6:39 PM
$0That's the whole point.

This. 100%. Franchise models should be abolished.

If you are moving up and down the tiers and your football club is up to par you should be accepted without a fee. In fact moving into the A-league should be a reward and not cost you anything. The clubs themselves should be able to survive on TV money, Food and merchandise, gate takings, memberships, friendly matches and tour promotions etc etc etc. What I am not sure about is do we unwind the lincence fees already paid by A-league clubs over time, which is about $50m or more or do we just write it off :)







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RBBAnonymous - 29 Jun 2017 7:09 PM
Waz - 29 Jun 2017 6:39 PM

This. 100%. Franchise models should be abolished.

If you are moving up and down the tiers and your football club is up to par you should be accepted without a fee. In fact moving into the A-league should be a reward and not cost you anything. The clubs themselves should be able to survive on TV money, Food and merchandise, gate takings, memberships, friendly matches and tour promotions etc etc etc. What I am not sure about is do we unwind the lincence fees already paid by A-league clubs over time, which is about $50m or more or do we just write it off :)

I think the best way would be to give the current HAL clubs an ownership into the league. So estimate a percentage (say 2% per club) and they own that much of the league. The clubs can sell their percentage off if they wish or keep it and retain a minor income. Would also push them to drive the league to success by sponsorship, marquees, etc

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jaymz - 29 Jun 2017 7:21 PM
RBBAnonymous - 29 Jun 2017 7:09 PM

I think the best way would be to give the current HAL clubs an ownership into the league. So estimate a percentage (say 2% per club) and they own that much of the league. The clubs can sell their percentage off if they wish or keep it and retain a minor income. Would also push them to drive the league to success by sponsorship, marquees, etc

Its not an easy one to answer. I don't like the idea of a legacy cost as well. How long would you let that go for considering that the A-league in 10 years time might look totally different that the current teams we have now (isn't that exciting, refresh the league every year)







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RBBAnonymous - 29 Jun 2017 7:29 PM
jaymz - 29 Jun 2017 7:21 PM

Its not an easy one to answer. I don't like the idea of a legacy cost as well. How long would you let that go for considering that the A-league in 10 years time might look totally different that the current teams we have now (isn't that exciting, refresh the league every year)

I don't either but thing is, its not fair on the current clubs who have shouldered losses since the beginning to then be expected to be removed of their iron clad guarantee of TV funding with the potential of being relegated. At least they are being compensated this way. Id say the ownership would be lifetime (unless sold) otherwise for the duration of their current licence. 

Its the only way I think you could convince them to agree to and open league tbh. I mean hypothetically if a club was relegated they would still be getting ownership payments in div 2 which would give them a great opportunity to get promoted. Not a level playing field but its the price we pay for the franchise system

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think Huddersfield just got paid out $200 million HA!
fancy that


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jaymz - 29 Jun 2017 7:44 PM
RBBAnonymous - 29 Jun 2017 7:29 PM

I don't either but thing is, its not fair on the current clubs who have shouldered losses since the beginning to then be expected to be removed of their iron clad guarantee of TV funding with the potential of being relegated. At least they are being compensated this way. Id say the ownership would be lifetime (unless sold) otherwise for the duration of their current licence. 

Its the only way I think you could convince them to agree to and open league tbh. I mean hypothetically if a club was relegated they would still be getting ownership payments in div 2 which would give them a great opportunity to get promoted. Not a level playing field but its the price we pay for the franchise system

I think once they get back what they paid as a licence fee, the payment should stop ie accounting for inflation of course :)







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No need to refund licence fees - no relegation until expansion is completed

12 teams = 2019
14 teams = 2024
16 teams = 2026

Then relegation. That's long enough.
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Waz - 29 Jun 2017 8:06 PM
No need to refund licence fees - no relegation until expansion is completed 12 teams = 201914 teams = 202416 teams = 2026 Then relegation. That's long enough.

Whilst I don't disagree with you. When would the second div come in?

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Agree with what other have said, quite clearly, P&R can only be introduced on the basis that there are no license fees.
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aussie scott21
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pippinu - 29 Jun 2017 8:56 PM
Agree with what other have said, quite clearly, P&R can only be introduced on the basis that there are no license fees.

This is wrong.
You could say any team getting promoted for the first time is not entitled to tv money and their share is distributed among the other clubs. This could be for 1 or 2 seasons and if they went down and came back up they would be free to enter. A one time fee or lack or tv revenue than it finishes. If an A-League went down they would not need to pay to come back up. 

Its not hard to find other solutions. 
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@ jaymz

Div 2 in 2018/19. My opinion is it should run parallel to the HAL and start at 12 clubs in a single division.
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$0.00c


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scott21 - 29 Jun 2017 9:29 PM
pippinu - 29 Jun 2017 8:56 PM

This is wrong.
You could say any team getting promoted for the first time is not entitled to tv money and their share is distributed among the other clubs. This could be for 1 or 2 seasons and if they went down and came back up they would be free to enter. A one time fee or lack or tv revenue than it finishes. If an A-League went down they would not need to pay to come back up. 

Its not hard to find other solutions. 

Are you saying that a team could only be promoted on the basis that they pay, or agree to pay over a certain time period, a license fee, OR they agree to forego all TV money for one or even two seasons?

Well, that's one way of making clubs wish they never earned promotion to the A-League.
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Showing that the club has the facilities, fans and community support, youth prospects etc are all more important for the game long term than giving the ffa a short term cash injection.
MarkfromCroydon
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The reason I reckon a fee should be payable is that we are now dealing with a business. The business owners (FFA and current clubs) are running the business and are trying to make money out of it. Most of them are not too successful at the minute, but that doesn't mean they're not trying to make a profit. They will not want to admit new teams unless the new teams can bring something to the business. As someone with experience running a business, I can tell you, the only partner I want is someone who has some skin in the game. They have to have something to lose. Why would you let a new club in 'free of charge' and take the risk that they would fold or be a poor addition to the league. The only way to make sure you have some protection is to make sure they pay to come in. I simply don't see why any current club would want to let any new club in for free. This is even more so given the licence fees that have been paid by the existing teams. 
To me, a $5 million fee is a reasonable fee. It's not chump change, but it should easily be affordable to any club that wants to play in the top league. For heavens sake, its the value of a single house in some areas of Sydney and Melbourne. 
Really, any club that would question or baulk at such a fee must be regarded with skepticism and you'd have to question how financially viable they are. 
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Is paying a $5million plus franchise like a ponzie scheme?
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MarkfromCroydon - 29 Jun 2017 11:42 PM
 They will not want to admit new teams unless the new teams can bring something to the business. 

Who gave them "Football" to play business with ?

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Arthur - 30 Jun 2017 10:38 AM
Is paying a $5million plus franchise like a ponzie scheme?

See , Aus Football does have a Pyramid.

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MarkfromCroydon - 29 Jun 2017 11:42 PM
The reason I reckon a fee should be payable is that we are now dealing with a business. The business owners (FFA and current clubs) are running the business and are trying to make money out of it. Most of them are not too successful at the minute, but that doesn't mean they're not trying to make a profit. They will not want to admit new teams unless the new teams can bring something to the business. As someone with experience running a business, I can tell you, the only partner I want is someone who has some skin in the game. They have to have something to lose. Why would you let a new club in 'free of charge' and take the risk that they would fold or be a poor addition to the league. The only way to make sure you have some protection is to make sure they pay to come in. I simply don't see why any current club would want to let any new club in for free. This is even more so given the licence fees that have been paid by the existing teams. 
To me, a $5 million fee is a reasonable fee. It's not chump change, but it should easily be affordable to any club that wants to play in the top league. For heavens sake, its the value of a single house in some areas of Sydney and Melbourne. 
Really, any club that would question or baulk at such a fee must be regarded with skepticism and you'd have to question how financially viable they are. 

This appears to be moving away from how we would normally view P&R.

In essence, you are saying P&R in only very limited, exceptional circumstances (or until a bigger NPL club like South Melbourne finally wins through, might be first year of P&R, or it might be in the 10th year of P&R).

Put another way, if you are looking at it from the perspective of the current club owners, and are arguing that they are unlikely to allow P&R any time soon, to safeguard their investments and improve their chances of clawing back a tiny bit of losses accrued over many years, then I would say to you:  yes, that's probably right.
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pippinu - 30 Jun 2017 11:00 AM
MarkfromCroydon - 29 Jun 2017 11:42 PM

This appears to be moving away from how we would normally view P&R.

In essence, you are saying P&R in only very limited, exceptional circumstances (or until a bigger NPL club like South Melbourne finally wins through, might be first year of P&R, or it might be in the 10th year of P&R).

Put another way, if you are looking at it from the perspective of the current club owners, and are arguing that they are unlikely to allow P&R any time soon, to safeguard their investments and improve their chances of clawing back a tiny bit of losses accrued over many years, then I would say to you:  yes, that's probably right.

Every club will have to have skin in the game. They will all need to reach a certain standard to play in the A-league. We need to plan for that so that those clubs who are ready over time can start making the investment. 







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RBBAnonymous - 30 Jun 2017 11:03 AM
pippinu - 30 Jun 2017 11:00 AM

Every club will have to have skin in the game. They will all need to reach a certain standard to play in the A-league. We need to plan for that so that those clubs who are ready over time can start making the investment. 

I agree about having "skin in the game" and reaching a "certain standard" - but that's not the question raised in the OP - he is asking if newly promoted clubs should pay a license fee, and he then suggests it should be $5 mill.

So you reckon all newly promoted clubs should pay a $5 mill license fee?

Have people truly though through the ramifications of demanding a $5 mill license fee from some tinpot club which has just won promotion?
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pippinu - 30 Jun 2017 11:14 AM
RBBAnonymous - 30 Jun 2017 11:03 AM

I agree about having "skin in the game" and reaching a "certain standard" - but that's not the question raised in the OP - he is asking if newly promoted clubs should pay a license fee, and he then suggests it should be $5 mill.

So you reckon all newly promoted clubs should pay a $5 mill license fee?

Have people truly though through the ramifications of demanding a $5 mill license fee from some tinpot club which has just won promotion?

My preferred option is that newly promoted clubs get promoted. To pay zero. I can understand the argument for clubs who have already paid a licence but that's the way it goes. We could go back to the first clubs who started in Australia back in the late 1800's. Do we owe them something as well? 







Edited
7 Years Ago by RBBAnonymous
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RBBAnonymous - 30 Jun 2017 11:35 AM
pippinu - 30 Jun 2017 11:14 AM

My preferred option is that newly promoted clubs get promoted. To pay zero. I can understand the argument for clubs who have already paid a licence but that's the way it goes. We could go back to the first clubs who started in Australia back in the late 1800's. Do we owe them something as well? 

We owe them our gratitude fro pioneering the game we all love in trying conditions.
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pippinu - 30 Jun 2017 11:37 AM
RBBAnonymous - 30 Jun 2017 11:35 AM

We owe them our gratitude fro pioneering the game we all love in trying conditions.

My sentiments exactly for our current A-league owners.







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RBBAnonymous - 30 Jun 2017 11:40 AM
pippinu - 30 Jun 2017 11:37 AM

My sentiments exactly for our current A-league owners.

Yes, fair enough.

Let us also pause to reflect on the great pioneers who have come and gone in the A-League's short history (Palmer, Tinkler, etc)
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