Seven West Media has refused to pay full price for its broadcast rights with Cricket Australia (CA), making a partial payment that is certain to stretch a relationship that is already incredibly strained reports ABC News.
Key points:
Foxtel is yet to reveal its cards publicly but is also believed to be adopting a similar approach to Seven in its pursuit of a discount from CA.
Seven and CA remain at loggerheads on the eve of the 2020-21 season, with the disgruntled free-to-air broadcaster threatening to walk away from its A$450 million (US$322m) commitment to the sport.
The media giant last week issued CA a legal letter, declaring the governing body had breached its contract. CA is yet to formally respond to that dispute, which if further escalated could potentially result in Seven terminating its deal.
The broadcaster, which used a range of arguments while pushing for its annual rights fee to be reduced, has now grown tired of CA's refusal to enter negotiations and opted to apply its own discount.
Seven, which was due to pay A$25 million (US$17.9m) to CA on Tuesday, has confirmed a smaller total has been transferred.
"Seven has paid the first instalment reflecting our assessment of fair value," Seven chief executive James Warburton said in a statement.
Seven is unlikely to make future payments, which indicates a legal case is looming unless the feuding parties reconcile their significant differences soon.
CA's interim chief executive Nick Hockley is desperate to avoid a hammer blow to his organisation's revenue. He has the backing of a board that has repeatedly declared it will not offer any form of discount on the six-year broadcast deal, which totalled $1.2 billion (US$860.5m) and was signed in 2018.
Hockley released a statement highlighting the upside of what he termed a "massive summer of cricket". Australian men play India in all formats while the women play a six-match series against close neighbours and rivals New Zealand. Add to that The Big Bash Leagues (BBL) for men and women which have proved to be the most watched leagues in Australia.
Despite the cricketing promise, Seven and Foxtel both remain frustrated at CA's inability to deliver a final schedule for 2020-21. CA is waiting on state-government clearances before releasing its updated fixtures list. The governing body has repeatedly insisted it will, unlike the AFL and NRL, deliver a full season of content as promised.
Seven has guaranteed it will broadcast cricket while the dispute rumbles on, starting with the season-opening women's trans-Tasman Twenty20 on September 26.
Warburton refused to reveal the exact figure transferred to CA but noted Seven picked the number after consulting a third party.
"Putting aside the questions of breach, in accordance with the contract Seven has invoked the right to appoint an independent expert. To determine the fair value of the media rights against the expected schedule for the season, compared to the originally published schedule, he said.
John Stephenson
john@cricketinvestor.co.uk
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