Cricket Australia (CA) is standing its ground in a dispute with its free-to-air partners, maintaining broadcasters have no legal grounds to terminate the game's $1.2 billion (£660.5m) television contract because they are unhappy at the number of Australian internationals in the Big Bash League.
Less than three weeks before the next broadcast payments are due to be made to CA from Seven West Media and Foxtel, Seven has gone on the front foot this week having become frustrated by the governing body's unwillingness to provide it a discount.
The Sydney Morning Herald and The Age revealed on Friday that Seven chief executive James Warburton was threatening to walk away from a six-year deal after only two years over a potential talent drain in the BBL brought about by players being quarantined for international matches.
"The quality obligations are paramount," Warburton said. "Should that not be delivered we are forced to consider all our options including terminating the contract and we have put them on notice accordingly."
Sources say Foxtel is also unhappy at the star power of the BBL being reduced because of international hubs, and the subscription television provider has on multiple occasions proposed a significant markdown on the rights fees for this summer.
In separate comments to News Corp, the majority owner of Foxtel, Warburton slammed CA as "the most incompetent administration I’ve ever worked with" and said Seven would not support the season if it top-line Australian players were missing from the Big Bash in even more abundance than usual.
Warburton's bombardment of CA is being interpreted by top officials in the game as a bid to reduce costs at a company whose net debt was this week announced at $398m (£219m), and they are intending to call his bluff.
The Seven CEO inherited the deal when he took over a year go, with his predecessor Tim Worner having presided over the network's seizing of the cricket rights.
Seven pipped Network Ten in a last-minute bid agreeing to splash out $82m (£45.1m) a year as Foxtel signed on for an annual spend of $115m (£63.3m) for the pay television coverage. The huge price tags are now a serious weight on the balance sheet of both, particularly in light of the coronavirus pandemic.
Warburton also praised ousted CA chief executive Kevin Roberts to News Corp, bemoaning his sacking by the board in June and taking aim at the organisation over its failure to begin searching for a full-time successor. In a development that may explain that backing, sources in cricket said Roberts had expressed an openness to giving the broadcasters a discount as a result of COVID-19 but the board was firmly against it. The former CEO did not return a call on Friday.
John Stephenson
john@cricketinvestor.co.uk
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