Provinces would pay for Ryan's free rugby
Published 02/05/2010 | 05:00
It sounds like a great wheeze. Free Heineken Cup rugby for everyone in the audience, no more irritating subscription charges and wall to wall Hook and Pope.
If life could be led without consequences -- if every decision you made only had benevolent repercussions -- then Eamon Ryan, the Minister for Communications, would be on to a sure-fire winner.
Unfortunately life is not so simple. Ryan has decided that rugby is "part of what we are" and that Heineken Cup rugby in particular helps to define us as a nation. His conclusion is that all Heineken Cup matches involving Irish teams should be available on free-to-air television, from the first pool match right through to the final.
Less controversially, Ryan believes that Six Nations matches should be protected for the nation. It is undoubtedly a populist stance, but that does not mean that it is sensible or well thought through. Ryan's timing was impeccable, as he chose the weekend of the Heineken Cup semi-finals to make his pitch. If there ever happens to be an all-Ireland Heineken Cup final, the clamour for free-to-air broadcasting will be deafening.
Ryan's passion for sport should not be doubted but his proposals for free TV coverage of Irish rugby will cause serious harm to the sport he claims as a national treasure. It is hard to get exact figures for the revenues generated by TV rights, but the IRFU gets about €15m a year from the Six Nations and Heineken Cup TV contracts -- with the latter contributing about €5m.
If Ryan got his way, and if all four Irish provinces managed to qualify, there would be a maximum of 19 matches covered on free-to-air Irish TV. It would be an attractive package, but would it generate €5m? According to people in the Irish TV industry, the actual market price for those matches would not exceed €2m, and could go for less. So even if the IRFU managed to extract the maximum value for those matches from RTE or TV3, it would be looking at a revenue loss of €3m. Or, to put it another way, the IRFU would no longer be able to support one of the provinces. Bye bye Connacht and players like Sean Cronin (pictured), but at least we'll be able to watch the other provinces on free-to-air TV.
If the Six Nations matches were similarly restricted to RTE (while it may want to play in the rugby market, TV3 does not have the resources to compete with the state-funded broadcaster), the IRFU would lose a big chunk of the €10m it currently receives from the TV rights. So not only goodbye Connacht, but goodbye to competitive, well-financed Munster, Leinster and Ulster. It would not be too long before the national treasure of the Heineken Cup had become a national embarrassment.
Without the means to provide a proper budget, the IRFU could only watch as the best left the country. And the clamour for free-to-air TV coverage would recede as the Irish provinces became the cannon fodder of the Heineken Cup. The new Italians, perhaps.
Money matters in sport, whether you like it or not. Rugby is a professional sport that has to be allowed to maximise the potential of the game. The more it earns, the more it will pump back into the grassroots of the game in this country. There will always be a balance to be struck between pay-per-view and free-to-air TV coverage, but the people who should decide that balance are the sports themselves. They know that mass coverage matters, so they will keep some matches free-to-air and they will also get as much cash as they can from the rest.
Sponsors, too, want a balance: the more eyeballs that O2 reaches for its sponsorship, the better, but it is the balance that counts for the IRFU as it juggles exposure against cash in hand. It is relevant, too, that the Heineken Cup is a recent phenomenon, a commercial concoction that lacks tradition but which has captured the hearts of rugby followers around the world. Why should a commercial success, in which the private sector has invested heavily (its success has much to do with Sky's involvement since 2003, and Heineken's promotion) be handed over as a cash-cow to a state-subsidised broadcaster on the whim of a misguided minister?
If Ryan's logic is taken to its logical conclusion, he should organise free-to-glass Guinness for all those in the country who regard it as a national treasure that should be available to all. Or perhaps Bono, another national treasure, should be forced to make all his music free-to-download for Irish citizens, and all U2's concerts should be free-to-attend. Why should sport be singled out for special state interference that destroys its revenue base?
Ryan's timing, while populist, also ignores the recent moves in the rugby rights market. ESPN, which bought Setanta's UK soccer coverage, has also bought more than 40 English Premiership rugby games for next season. It likes the sport and particularly likes the demographics -- affluent males, surprisingly high female interest. It is possible that it will be a rival bidder for the next Heineken Cup contract, forcing up the price that European rugby can extract. None of that money will flow to Irish rugby if we take ourselves out of the bidding by handing all our games to RTE.
Like many ministers before him, Ryan should study the evidence, and understand the consequences, before he starts to take other people's income by force. Free-to-air Heineken Cup rugby would, very quickly, emasculate Irish provincial rugby. Unless, of course, Ryan agrees to make up the revenue shortfall with the taxpayers' money. A shame we don't have any left.