Watch me start off simplifying this and then making it much more complicated as we go along.
NRL clubs currently receive a grant from the NRL every year. This is basically their share of the current broadcasting deal.
The NRL is looking to get clubs to sign an agreement that says that next year, they will get the money they have all budgeted for, and have known they would be getting for some time now, but when the new broadcasting deal kicks in in 2013, there are no guarantee’s of how much clubs will get, but the working of the agreement basically says “We can’t put a figure on how much you will get in 2013, but we will sort that out as soon as we can”.
For NRL clubs, that isn’t really good enough. They need to set their budgets for 2013 very soon and can’t work off rubbery numbers. So what the clubs are looking for is a more concrete assurance of how much they will get in 2013.
Now, while they are looking at this, there is also a push to maybe get a bit more money for 2012 while they are at it too. I tend to think this is more of a ploy by the clubs though. If they can get a firm figure for 2013, I’m sure they would forget getting an increase in 2012.
Still, you can see why clubs would like a bit more money in 2012. Because the cap wouldn’t increase by any great amount for next year, that extra money would basically go straight into the clubs coffers.
There is a lot of talk right now that 14 of the NRL’s 16 clubs run at a loss. Sounds bad, but keep in mind, in an ideal world, clubs would break even every single year.
If you gave a club $100,000,000, they should spend every cent of that, whether it be on improving the coaching staff, talent scouting, junior development, improving training and playing facilities….clubs aren’t set up to make profits. That is not their business.
Now obviously it isn’t great that clubs are losing money right now, but most of those losses can be attributed to the fact that the current broadcasting deal is just so terrible. That will all change in 2013 when the new broadcasting deal kicks in.
Talk of a breakaway competition is just stupid and I think its mostly fueled by idiots in the media.
We WILL NOT see a break away competition by NRL clubs, for a million different reasons. So don’t even listen to that talk. It won’t happen.
We also will not see a single game missed, this will all be well and truly cleared up before the season gets close, if only for the simple reason that the clubs can not afford to lose income from missing a single game.
One issue I think the clubs will be pushing for looking towards 2013 is an increase in the percentage of the money they receive from the games overall broadcasting income.
The clubs have a point in that, they provide the content from which the entire game profits from. Yes there is a need to shore up grassroots Rugby League, but I agree with the clubs that they deserve a greater cut of the broadcasting rights now that the overall pot of money will be greater. The clubs can get a greater cut, and we would still see funding for grassroots Rugby League rise.
As usual, we are seeing News Limited media and Fairfax media outlets lining up this issue from opposing sides, and a lot of what you are reading is just both sides playing their stupid games, its ridiculous.
So what do I think we will see happen?
I think we will see the clubs sign off on a one year deal that will see them compete in next years competition with little to no increase in the amount of money they receive. Then, once the broadcasting deal is finalized, we will see NRL clubs get a great cut of the overall pie and their grants from the NRL will be much higher than they currently are now.
What I think we will see from there is players having to push for an increase in the salary cap. Clubs will be willing to give an increase, but I think we will see it go up in increments, so that the first few years of the next broadcasting deal will allow clubs to get back on their feet financially.
So what you are seeing right now is a bit of a game that NRL clubs are playing with the NRL. There isn’t as much too it as the media is making out. Of course, its the off season, and there isn’t a great deal else going on, so this issue is obviously the worst thing that has ever happened in the history of history…
So don’t worry about it. There is no need to worry about it.
