https://www.theage.com.au/sport/soccer/fox-sports-threaten-to-withhold-5m-from-ffa-over-western-united-20190221-p50zeh.html

Fox Sports threaten to withhold $5m from FFA over Western United

A decision by A-League expansion side Western United not to incorporate the word ‘Melbourne' in its name could cost Football Federation Australia $5 million in annual TV rights after it opened the door for Fox Sports to challenge its obligation to increase broadcast payments.

The Herald understands Fox Sports is seeking to avoid paying a nine percent increase of its broadcast deal in June 2021 despite being contractually obliged to contribute an additional $5million if two new teams were introduced to the A-League from Sydney and Melbourne.

However, several sources suggest the Pay TV provider is intending to withhold the revenue increase after the newest A-League side announced last week that it would compete under the name "Western United Football Club" while based in Wyndham in west Melbourne while temporarily playing games in Geelong in its first two years. 

It's understood that representatives of Fox Sports argued to FFA that in not being associated by name with Melbourne, Western United cannot be viewed as a team from the Victorian capital, rather as a regional club.

FFA issued a stern response to Fox Sports, arguing the name does not diminish its association with Melbourne, citing AFL side Western Bulldogs as an example. Meanwhile, behind the scenes, administrators urged Western United to incorporate more references to the city of Melbourne in their latter stages of branding.

It's understood FFA hoped to kill off the argument entirely by pushing the new club to include the word "Melbourne" or references to the city in its yet-to-be-released logo. Sources suggest FFA is continuing to lobby the group to adapt a stronger association with the city before entering the competition.

The governing body is hoping the new team will be playing out of its new purpose-built football stadium on the outskirts of Melbourne before July 2021, when Fox Sports must increase its payments for expansion.

The club will enter the A-League in October, playing out of Kardinia Park in Geelong for at least two seasons during construction of its permanent home in Tarneit, 30 kilometres from the centre of Melbourne.

The Herald sought comment from Fox Sports on Thursday. It is understood the network has not disputed the other A-League expansion club, Macarthur South-West Sydney, being a team from Sydney.

While Fox Sports are unlikely to be successful in arguing the newest A-League club are not from Melbourne, the stoush reflects the pay TV provider's dwindling appetite for Australian domestic football at a time when viewership has dropped significantly.

Last week, only 29,000 watched Western Sydney Wanderers beat Adelaide United on the Saturday night timeslot while Newcastle Jets win over Melbourne City on Friday night attracted 18,000 viewers on Fox Sports.

Last season had an average ratings of 51,000 for each game while the 2016-17 season average audience was 63,000 per match. The A-League's peak average rating on Fox Sports was almost 75,000 in the 2012-13 season which included Alessandro Del Piero at Sydney FC and the birth of Western Sydney Wanderers.

The FFA has entered negotiations for a new free-to-air partnership for next season with its partnership with Channel1 0 yet to attract a broader reach.

The A-League has been televised live on 10 for the past two seasons after Fox Sports purchased the FTA component, moving it to 10 as part of its former partnership with the network. The current agreement doesn't encourage promotion from 10 with sources suggesting Fox Sports retains the bulk of advertising revenue from Saturday night games.

I think this deserves its own thread due to the underlying current here. its absolutely alarming that fox sports is trying to wiggle its way out of its obligations. it helps reinforce the rumour that they tried to buy out of the HAL 12 months ago. I'm glad to FFA told them get stuffed, but we are within our rights to be very worried about this.

The HAL is in trouble, look at the ratings decline in the last few paragraphs. You are talking about a 50% decline in viewers since the last pay tv deal and FTA ratings are so low you cant even get figures anymore so no wonder fox are looking to reduce costs. Doesn't bode well for the next tv deal.

I didn't realise it had plummeted by that much?

I'm one of that 50% decline.

I rarely watch HAL anymore.

It stresses the importance of havign our shit together (Independent HAL, clear expansion + 2nd Division plans) by the time the next TV deal comes around. 

At this stage, there's no way we even get a remotely similar deal to the one we just got. The ratings are abysmal across the board. 

It's the FFA's fault for allowing the league to stagnate. We'd probabaly be better of if the a-league collapsed and a new league was started with promotion and relegation and more teams.

Haters gonna hate this, but the way the salary cup is structured  the teams with the most money rise to the top, you get the odd fairytale team like jets last year and Nux this year, but basically the league is not close enough, with the top 6 virtually locked in people lose interest.

In the early days the quality was poorer but all the teams were close, a battle every game, made it really interesting.

Getting rid of the cap will make it more like the SPL then it is now. 
P/r will add revolving interest but the same issue will occur unless everyone is either willing to invest in players or more restrictions on the salary cap enforced .

It is observable that the last five or six seasons has seen a few clubs dominate at different times, compared to how open it was the first five or six seasons.  In season 3, when we had our largest average attendance of nearly 15k, Jets beat the Mariners in the grand final.  Even the short lived Gold Coast United was able to finish third in its first two seasons.  The Wanderers were able to win the premiership in the very first season.  Hard to imagine that Western United will be able to replicate that.

The interesting thing here is that of the Melbourne bids, I don't think either Team 11 or WUFC were ever going to use the word Melbourne in the name. South Melbourne would have been the only Melbourne bid that would have fit that requirement. This is clearly Fox trying to weasel out of the deal.

Questions also need to be asked of the FFA as to why it continued to entertain Canberra. It is obvious now that only bids that met Fox's funding requirement where actually going to succeed, so why waste Canberra's time and resources. Yet another example of a lack of transparency from the FFA.

With Fox receiving the bulk of advertising revenue from the FTA broadcast, it's no wonder 10 don't promote it. Why should they. Yet another example of shortsightedness on behalf of the FFA. They really should be pushing to have all games broadcast on a FTA network, but have them on a delayed telecast rather than live. Having a single live game on FTA is useless as there is no saturation. 

would sbs take us back? 

So, all Melbourne teams should have Melbourne in their name and its the same for Sydney?

Fox sports can get fucked.

Theres going to be regional teams in the a-league anyway especially when promotion and relegation comes in the near future.

That isnt what fox are saying at all did you read the article? 

the contract they had was for a team in Melbourne and Sydney at team playing in Geelong is not melbourne based and without the word melbourne in it is not contractually bound to paid the money the FFA have f***d up NOT foxtel. 

If anything foxtel are losing a truck tone of money on the HAL based on decline in ratings ----HOWEVER---- we are starting to see the deterioration of foxsports football because they lost the rights to the EPL a few seasons ago. Most EPL fans might watch a bit of the HAL if it is on TV since optus took over they dont have access to it they dont love the league but they love the sport and will watch it if they have access to it which they no longer do... 

As crazy as it is this is really worrying signs for the league.The harsh reality is the fox money is what keeps the league alive and if fox are looking at ways to get out of committing to the league (through dictating the season length and limiting expansion and then trying to still get out of paying extra). It says things are not in a great way. 

But its a bit laughable the solution to fix everything- i.e. pro/rel is being mentioned. If fox are losing interest broadcasting the top division they will have absolutely no interest in a second division broadcast especially in more remote areas than the big cities. I cant see a second div being truly professional without broadcast deal and I cant see it getitng a broadcast deal. 

And for the comments of we dont need fox- we really really do. We havent exactly had FTE bashing down the door offering big contracts and neither has a streaming comapny. No fox money means no professional league. 

very backwards thinking. with that attitude football never get anywhere in this country.

We are dependent on Foxtel money like a druggo relies on their dealer. Need to wean ourselves of it some how or at least not be as dependent.

Correct.

We need a self-sustainable league - THEN go for the tv money.

The reality is that an A-League franchise costs around $7-10m/year to run.  They get less than $3m/year from tv...  So if we can trim them to run on a $4m budget, the tv money becomes gravy.  As interest increases in the clubs themselves, the tv value will rise.  

Lifting this off the P&R thread which spoke about the J League:

The league also encouraged the clubs to promote football or non-football related sports and health activities, to acquire local sponsorships, and to build good relationships with their hometowns at the grass-root level. The league believed that this would allow the clubs to bond with their respective cities and towns and get support from local government, companies, and citizens. In other words, clubs would be able to rely on the locals, rather than major national sponsors.

If the FFA are throwing all of its eggs under the Foxtel basket for not just consolidation let alone growth of the a-league then its a severe high risk for failure as everything will dictate that we are not running a football league but a commercial monopoly from a TV company.

So now we are relying on Foxtel to set the future for the sport going forward and if it doesn't go their that's it? Is this a sustainable model for the game in the long term?

Has it occurred to anyone that the reason for the decline in Foxtel rating may also be attributed to online streaming  ? I still have Foxtel and watch it on that format ...I am older....but many of the younger generation watch it on other platforms .
It is obvious that the A-League has stagnated a little over the past few years (Thank you Steven Lowy ,David Gallop) but I am not convinced the Foxtel figures are telling the true story.
Seems an obvious fix ...last good ratings were when we had a new club and star marquees.
new clubs ? - check
star marquees ? - no

Well put it this way- if the numbers were healthy across all platforms, Fox would not be trying to renege on their contract over a team name. 

No one said numbers were healthy across all platforms...I simply suggested that maybe they are not as bad as the Foxtel figures show .
Foxtel are paying the lions share of funding for the A-League yet they are sharing viewers with other platforms and may be angling for an excuse to pay much less (or pull out altogether). This is not just a "football" problem ..it is a problem across all broadcasting  ie FTA TV and Foxtel shows in general.
Football needs to maybe consider having their own film unit and selling directly to all platforms . ala  Liverpool TV , Manchester UTD TV etc etc ...and yes I realize that would be a big and expensive change but we need to start looking ahead ...in only a few years Foxtel and FTA will not exist in their current form .
We will need to have some sort of income stream in place.
We need to be pro-active not reactive ...for once .

It's not isolated to the HAL. Ratings have been slumping and declining across most sports around the world. NFL, NBA and EPL are all on the decline and have been for the last few years. All of those sports offer streaming services, yet there is still a decline. There is no single reason for this and no single solution.
My hypothesis is that production costs have become far are too high and they need to be reduced. To put it simply, the media industry needs to be streamlined, in particular staffing levels and wages need to drop. 

i think they'll take anyone. the ch 10 deal is absolute poison. 


its just an excuse to withold the money. 


have you ever heard of a company called Croc Media? Its owned by Craig Hutchison (they also are the majority owners of radio station SEN).

anyway, Croc Media is primarily a company that specialises in the production of sports on radio. They then sell the production to any radio station around australia who wants to broadcast that specific sport. Thus cutting costs for everyone. have you ever heard of AFL Nation? NRL Nation? Big Bash Nation? Football Nation? They are all Croc Media productions.   

Is there anyone out there that can do a similar thing for TV? 

Foxtel :)

It's doubly ironic that the FFA themselves insisted on Northern Fury rebranding as Northern Queensland Fury because they needed to give a clearer geographic indicator...  Yet quite happily approved a Western United bid that is clearly about the western region rather than the west of the city.  They must have cross-hairs on their feet at FFA HQ.

Northern Queensland was never going to get a second team so a far reaching name is not inappropriate. As it turns out Northern Queensland is lucky it even had one.

many lower divisions don't get broadcast usually only the big games..

So by reducing their turnover interest will grow. Lol.

no, its about allowing clubs to operate within there means rather than being dictated to by a multitude of rules and regulations like the salary cap for example.

Or its just realistic and people like their dreams. 


What league is reliant on their TV money? And how do you propsoe we become independent on broadcasting money? Because if you say go FTE or streaming not only is that less money for the league but none of those are realistically lining up and throwing their money at the league. Without fox the league is going to die. 


Contraction for growth is an odd idea. How exactly are you proposing cutting 3mil from costs?

so just stay the course or do you have a better idea? perhaps football is doomed to fail in the country for all of eternity lol

Clubs need to look for other sources for sustainability. Right now, the HAL is captive to Foxtel. Foxtel as a business is also at risk as well. If the HAL was to look at long term survival, other sources or a more diverse range of sources are needed.

removing the salary cap will increase the value of players.

Does that also mean introducing transfer fees - because that would be a driver for revenue.

Contraction for stability - growth from stability. 

Where to trim budgets?  Impossible to say without a break-down of each franchise's budget - but there's clubs all over the world, and around Australia, operating at a pretty good level for less than $5m/season.

Our reliance on Fox is part of the reason the game is falling on its arse.  We've built a league so reliant on their cash that we have to bend over every time they tell us too...  Play a short season during the off-season of their more popular sports...  Stagger fixtures across the weekend so no one can remember when the next game is...  Pick teams from capital cities rather than have teams in the league by virtue of their football...  Play in oversized stadia because the media facilities and lighting is more important than the club's own cash-flow. 

One radical solution is that the FFA takes on the cost of production themselves, and then offers a finished product to the networks, in addition to streaming it on their own platform/in partnership with a telco.

Maybe when the billionaire owners get to control the A-league they will form an "A-League TV" of some sort to sell content to whatever platforms they can ?
...and lets face it ..one thing billionaires are good at is selling stuff !
If we plebs can see the writing on the wall re Foxtel and FTA  I am sure it has occurred to the Club owners ...
(I would have said that FFA would have realized this too...but it would not surprise me if they had not thought of this at all :D)

I think we should stop praying for some benefactor to swoop in and save the league. It's not sustainable or realistic.

@simione001

If they remove the cap then the bigger clubs will increase its costs in purchasing bigger player contracts. In turn smaller clubs will at least maintain current player expenditure to have any chance to keep up. Can’t see how this will reduce their running costs.

@Burzter

To promote non football sports and health activities cost money. If affordable they should be doing it now but doesn’t seem to generally be the case. Can they do it with less available funds?

That was an example from the J League. It also spoke about having greater local focus and support (Victory in Business is a good example imo). There should be plenty of opportunities around but there might not be the incentive since Foxtel covers a significant part of the cost or at least, there is less incentive to look for other sources.

As for cutting costs, I'm not sure. $7-$10m to run a HAL club doesn't sound too exorbitant in all honesty. Assuming CCM are spending $7m p.a., I can't see them having too much fat to trim. 

clubs should able to spend as little or as much as they want or can afford.

Foxtel Foxtel.....  this really is a 'slap in the face' to the A-league and Football overall.  :(

Maybe however most ( if not all ) clubs are not reducing their salary costs even to the minimum specified by the FFA. This is within their control now.

just go back on sbs problem solved 

Where does to missing Foxtel millions come from then????

In other words the current model is garbage. 

All sustainable professional leagues rely on TV money as their main source of income.

In Australia yes, but overseas this isnt entirely the case due to the poor infrastructure of the clubs inability to sustain there own businesses without the sugar daddy hits here and there.

All sustainable TV deals come as a result of competition between bidders.  If your principal backer drops out, others will line up to replace them, so clubs can have a degree of confidence that income streams will exist long into the future.

The A-League operates on a deal that the principal partner is currently doing its best to get out of, having been unable to on-sell FTA rights for any significant sum.  When they bought the rights they did so without any serious competition.  Since buying the rights, ratings have fallen rather than grown.

We can either operate on the premise that Fox will continue to give the FFA generous deals despite a lack of competition, and allow them to negatively impact the actual game, or we can operate in the best interests of the game and develop a league which doesn't rely on a small handout.

These days i question whether the closure of the NSL was worth it or not, with the FFA starting the game again a clean sheet of paper and for the FFA to set out a new era where everything is dictated by a TV company on how many teams to games played, even some of the stadiums sizes are not properly fixed for the benefit of the football product.

At least for all of the problems in the NSL era, at least we had a football structure which propelled to have the right amount of teams and games played and youth league structure, but since the 'new football era' began we only expanded to 10 teams( 2 failed sides), cut costing youth league structure, fragmented system where the a-league is played in a different season from the NPL, to having the longest offseason in world football! .

Have we really we made progress? I have to highly question the work of Frank Lowy and John O'Neill if blow torching the game in starting again in 2005 was a great idea but right now the game is at a crossroads as we dont know what the a-league will even look like in the future due to the incompetence of the FFA in there inability creating the right structure of a proper football league should look like in a global standpoint at the beginning.

Manu, MC, Chelsea etc say hello.

Unless you can find billionaire benefactors for the HAL and billion dollar TV deals, we can't compare or try to emulate the EPL model. 

EPL clubs are overwhelmingly profitable and dont just rely on TV $ or benefactors, those days are long gone. Interesting article below

https://www.theguardian.com/football/2018/jun/06/premier-league-clubs-profit-record-revenues-tv-deal

Take away all tv money and they wouldn't be profitable anymore...  That's why relegated clubs usually go into slash and burn mode...

However...  If the main broadcaster dropped away in England, there would be another to jump into their place.  Our problem here is that no one else appears to want to take Fox on for our relatively small tv deal.  As a result there's no force to push the value up, and more importantly there's no safety net if they collapse.

There are plenty of articles in the web but ManU TV revenue was only 34% of their total last year, with the tv exposure driving other income sources. Spurs didnt build a new stadium because they were going to get more TV money!In portugal majority of their income is from transfer fees & TV money is poor comparatively.

some of you guys need to explore the world outside the HAL Franchise bubble

Safe to say I've explored way beyond the HAL franchise bubble...  I was commenting on the EPL money, not any other leagues around the world.  Using the finances of the top 3-4 English clubs to demonstrate that the majority of the league would be viable without the tv deal is dubious logic.

It's quite interesting that the majority who have been posting on here about what needs to happen with the A-League think that the EPL is the model we should follow.  I don't but I'm one of the few.

I dont get this point

If the EPL model requires billionaire owners than why has it been implemented pretty much everywhere except Australia and America?

It depends how one defines the EPL model...  Personally, I prefer the ownership structure of Bundesliga clubs.

I don't think most think we should follow the EPL model though - I think most think we should follow the world standard of promotion & relegation.

I agree totally with the Bundesliga model.  The purpose and the framework for the League is set out in a Treaty between the DFB and the club owners body that is negotiated between the two parties and then a separate operational body runs the league as set out in the Treaty.  The League operates to serve both the purposes of football and the owners and the operational body operates without a conflict of interest.  The Treaty is able to be renegotiated and this has occurred at least one.

I guess it depends on aspects of the EPL model - being P&R which is universal. 

We can't adopt it's revenue model however - we simply don't have the ability to generate the level of TV rights and billionaires.

Too esfhhnix

South Melbourne FC sounds pretty good.

ive always found it confusing that despite the fact that the league appears to be struggling there seems to be no lack of interest from individuals looking to start new franchises.

Ty Fox for forcing these muppets do their job correctly.

-PB

It obvious Fox overspent on Cricket and now don't want spend extra on other sports if they don't have to. 

So there wont be a FTA channel next season? Or it goes to the ABC.

It would be interesting to see what the cost of cricket vs AFL vs HAL is on $ per average viewers, will give you an idea of where they get most bank for the buck

which is great of course. they clearly believe in the long term it'll be worthwhile. However, it will be interesting to hear if there will be any stories about potential bidders walking away due the dropping away of the HAL in the coming years.


that would be very interesting data. Maybe FootyIndustry Twitter might be able to provide those figures. 

saw a tweet once from sportsindustry showing the total AFL income (AFL plus the 18 clubs) to be $1.6 billion previous year, with the broadcast revenue being $418 million of that (or about one quarter).

Quality of players & coaches in a league, do have an effect on ratings as the assumption the more you pay the better the competition...

This is one of the key arguments in getting rid of the salary cap.... ie increase the quality of players to lift the league.. 

If we lost the Fox money, those assuming a great new dawning will be disappointed in the outcome... If the A-League falls over, then don't expect any broadcaster, streaming or otherwise to invest in a major way.... professional Football in Australia without the coverage a major news outlet brings and the revenue it brings will be set back a number of years...

The assumption of some vast, huge untapped Football market in Australia just waiting for a change in operating systems boarders on insane...

P & R will come, but in and of itself without money for quality players and coaches, it will not drag the playing base across ..

 

We really just need to follow in teh footsteps of every other football league in the world and let Billionaires pour money down the drain in a competition to see who's trophy team will win. 
The focus on clubs breaking even is killing the aleague, as funny as it sounds. "Lets all be really cautious and not sepnd any money and in 100 years we'll be 5% bigger if we're lucky". 

The aleague needs excitement. Big names. Advertising. Active fans. Cheaper tickets.
We have/have had billionaires running clubs but they're penny pinchers for whatever reason. 
I've certainly never watched as little aleague as i have this season. It's just the same crap over and over again. No investment.

The aleague has been standing stil for 5 years now. Which means we've gone backwards fast. Every other country in Asia is pouring money into football yet we can't find enough money to have decent facilities. It's bad signs for the Socceroos too. 
We need some Del Pieros next season - another reason Western's interest in Brown and Kone are extremely underwhelming given their link with Sticca

How many leagues in the world have billionaires pouring money in?

We need to understand that just about every other league in the world began before tv, and grew organically with sustainable clubs.  TV money, no matter how large, was always the gravy on top of the meal, rather than the meal itself.  Until we have a league that can stand without tv money, we will always be playing the game for the benefit of the tv deal, rather than for the benefit of the game.

So basically the FFA are doing all they can to ensure they get an extra $5m for our game two years from now

Wow. Thats big thinking

The writing is on the wall. Fox are no longer interested. Instead of creating an expansion plan that would have ensured our TV deal doubled, we have instead chased the smallest possible outcome

funny thing is they tossed out other options because of this $5mill

The salary cap is doing exactly what it’s supposed to do:

In the last 8 years we’ve had 6 different winners of the Premiers plate and 5 different champions.