[VFL] 1987 VFL TV Rights Saga - Sports Industry AU

Background

The Victorian Football Leagues Television rights with Channel Seven expired after the 1986 Grand Final, and the VFL opened up the rights to bidders and were expecting a significant increase in the rights from the $3.3 million paid for the 1986 season by the Seven Network due to the expansion into Perth and Brisbane the following year. Seven had been the leagues main broadcasters for nine years, and had been broadcast VFL since 1957.

The 1987 Rights

The VFL were surprised when Seven offered no increase on the rights for 1987, staying firm on $3.3 million for the 1987 season (Football Limited pg 163) – Ross Oakley says 3.4 million (The Phoenix Rises pg 85). The league did not believe a 13% increase was enough, and the VFL decided to try other stations, but no interest was forthcoming from the Nine or Ten networks. After a couple of weeks, the league went back to Seven only to be told they had taken too long to consider the offer – evidently a two week deadline – and it was now being reduced to $3 million a season. (Football Limited pg 167).

Ross Oakley and the VFL Commission were convinced a deal had been done amongst the networks to keep off each others turf, and this included Sevens hold on the VFL tv rights. On December 1st, Oakley reported that there would be no bids coming from Nine or Ten, and that Seven and the ABC had some concerns with the tender conditions. It was decided to seek advice from Kerry Packer and Channel Nine (The Phoenix Rises, pg 86). Packer reportedly told Peter Scanlon that the VFL should warehouse the rights for a year and not commit to anyone for more than a year (Football Limited pg 169).

In December 1986, the VFL and Broadcom anounced they had signed a deal for $24.5 million over six years, with Broadcom to onsell TV rights.. The deal included profit sharing up to $24.55 million. If sales didnt reach $4 million a year, the VFL would likely lose money. Seven had offered $3 million a season, but were unsuccessful. However Seven would continue to show the preseaon Panasonic Cup. Sportsplay had offered $5 million a year for the rights, but like Seven, had failed.

VFL Commissioners Peter Scanlon, and Graeme Samuel had financial interests in Broadcom, a fact Ross Oakley says the Commission was aware of, and that the two were absent from any deliberations in the TV rights. This caused some tension between the AFL, and the Herald and Weekly Times which railed against it. (The Phoenix Rises pg 99)

In January, it was reported that Seven were refusing to negotiate with Broadcom, and the Nine and Ten networks werent interested in bidding. Sportsplay, who had failed in their bid for the rights, announced they would bid for the rights to show the games into clubs and pubs via sattelite. Sky Channel and Superstation also expressed an interest.

A week after the announcement by the League, a dispute emerged over international rights, with Active Marketing claiming they had exclusive access to the international rights of VFL programs for the following three years.

On January 28th, 1987, Seven Network (Melbourne) manager Ron Casey offered the VFL $2 million for the 1987 Victorian rights, but later withdrew them, signing instead a deal for $1.4 million, while still broadcasting the preseason competition. (The Phoenix Rises pg 95, Football Limited pg 176). However, Seven was soon sold to Fairfax, and on March 13, the league announced the Seven deal for 1987 had collapsed (The Phoenix Rises pg 96). The league then turned to the ABC which signed on for $1.6 million (Note that Football Limited says it was slightly less than 1.5 million)

In February 1987, Sportsplay and the VFL came to a disagreement over the broadcasting of live VFL into country Victoria. Ross Oakley confirmed that the VFL had guaranteed the Victorian Country Football League that live broadcasts were not on the table for country Victoria.

The 1987 Broadcast Deals

Broadcom secured the rights to VFL broadcasts for$24.55 million over six years. This included $3.5 million in the first year, plus an upfront payment of $1.3 million. (The Phoenix Rises pg. 88)

The ABC secured the rights to broadcast in Victoria for $1.5 million. (Ross Oakley says 1.6 million.) The deal included:

Replays between 5pm and 7pm on Saturdays
Live coverage of matches outside Victoria on Sundays.
Replays of Sunday matches in NSW on Sunday evenings.
In Canberra, the ABC would show highlights of Friday night and Saturdays at 10am on Sundays, and highlights of Sunday matches at 10.30pm on Sunday.

In addition

Sportsplay Television Systems paid $3.5 million a year to broadcast into licensed Hotels and Clubs across Australia via Sattelite.
Saturday matches live on Canberra on Capital Seven.
Saturday matches live in Sydney on SBS.

Sportsplay Television Systems paid $3.5 million, through Broadcom, for exclusive rights to matches outside of Melbourne into Hotels and clubs., this included 23 Saturday games, 18 Friday games and 4 monday night matches.

Post 1987 Media Rights

Christopher Skase purchased Seven from Fairfax in late 1987. In September 1987, Broadcom were reportedly entertaining an offer of $6 million for the 1988 season, with Seven confirming they had lodged a bid, but not the amount.

The ABC took out an injunction to prevent the sale of media rights by Broadcom for the 1988 season. This injunction was lifted on October 1.

The final 1988 deal with Seven was for $5.5 million plus $1 million in contra per year. In 1993 it was $12.5 million a year, up to $18.5 million a year (+$2.9 million contra) in 1997). In 2001, it was $33 million a year + 4.5 million contra. (The Phoenix Rises pg 104)

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