Australia's commercial free-to-air broadcasters are concerned about Cricket Australia potentially wrapping up a subscription broadcast deal without the free-to-air television component being built in.
Concern from free-to-air broadcasters is growing that Foxtel will lock up a lot of the sport behind a paywall and they will be forced to negotiate with the pay TV provider rather than Cricket Australia.
Fox Sports was able to secure a better position after Cricket Australia rejected a consortium bid from Nine and Ten. Before that the subscription TV channel was itself frustrated by the Nine-Ten bid locking them out.
Free-to-air executives warn the value of cricket to them could be severely diminished if Fox Sports controls the rights and they end up with a simulcast where they don't control the advertising, undermining their ability to monetise the sport.
There are also concerns over the sports digital rights, with Foxtel exploring a direct-to-consumer Fox Sports streaming service, it remains unclear how that would impact free-to-air if they simply had linear broadcast rights.
Behind the scenes the TV networks are supportive of Cricket Australia chief executive James Sutherland and his ability to take some decisive action, and are hoping he takes an active role in the rights negotiations.
Sources said the commercial free-to-air broadcasters concede pay TV has a role to play in Cricket Australia's next deal if the organisation wants to get a higher price, but they are pushing to emphasise their reach is valuable and if their ability to monetise the rights is diminished either through not enough cricket or simulcast taking value out, their interest in the sport will wane.
Negotiations with Cricket Australia are ongoing but sources said talks were beginning to speed up and a deal could be reached as early as next week.
Cricket Australia is weighing up audience reach over cash. Foxtel can afford to pay a higher price for cricket, but the free-to-air sector has far greater reach. The association's tender documents outline "CA is not required to accept the highest financial bid".
The anti-siphoning list, which dictates the sports that free-to-air television has first rights to bid on, will mean Fox Sports will need to work with a free-to-air partner. Test matches and international limited overs cricket is on the anti-siphoning list, while the Big Bash League is not. However, that doesn't necessarily guarantee sports on the list for free-to-air.
Cricket Australia wants a deal for the next six seasons, starting in October, and has told broadcasters that potentially only select content needs to be shown on free-to-air television, including Ashes, Boxing Day and New Year's Tests, every women's international game, about half of the Big Bash League, including finals, and special events such as the annual Allan Border Medal presentation.
Nine remains keen on Test match cricket in particular, despite securing Tennis Australia's broadcast rights last week, while Ten wants to re-sign the Big Bash League and is potentially looking at branching into international cricket. Sources said the pair bid around $130 million a year, including cash, contra and taking on production costs for women's cricket, which Cricket Australia previously paid. Meanwhile, Seven West Media is understood to have thrown in a second bid for cricket and is expected to push hard having lost its summer sport, tennis, to Nine.
Better rating sport
Cricket Australia is said to want at least $150 million annually, or $900 million over six years for all rights.
Foxtel needs far better rating summer sport than soccer and basketball are delivering. It also is offering a dedicated cricket channel, as it has done for NRL and AFL, a move both sports have benefited from.
In its tender documents, the organisation said it had four primary transaction objectives for the licensing of its rights: an alignment with CA's strategy, including supporting its digital strategy; the financial optimising of the rights; reach and exposure of the sport; and a commitment to promote or "leverage" cricket across the broadcaster's network.
CA said it had made "a significant investment in building a world-class digital offering for Australian (and global) cricket fans" in the past five years in a partnership with Nine. It said it "has a strong preference to ensure the continuation of a partnership model", though it also left the door open for bidders to take all digital-streaming content under a full licensed rights model.
Cricket Australia, Ten, Nine and Seven declined to comment.
This article was published and provided by the Australian Financial Review.