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Australian rugby 'facing financial precipice'
ESPN Staff
March 28, 2014
Super Rugby may not lack action but it's costing Australian rugby a fortune to run © Getty Images
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A report by an Australian sports management consultants claims that the Australian board (ARU) has to get more selfish in its dealings with other southern hemisphere countries are local rugby will "go over the financial precipice".

The report, which is highlighted in Greg Growsden's Ruck'n'Maul column, is critical of decisions, backed by the ARU, to expand the Super Rugby competition by making concessions to New Zealand, South Africa and Argentina and also flags that substantial financial losses being incurred cannot continue. It accuses the ARU of not "looking after the interests of Australian rugby".

"No code can sustain itself and retain a large group of internationally competitive players if it employs them in a serious revenue-generating competition for only half the year- and even more so if that competition is structured to contain a lot of dud product, which is currently the case with Super Rugby from an Australian perspective. Dealing with this issue requires a dramatic shift in the regular competition structure, not a few fiddles trying to pick up a few million here or there while carving more resources out of the game."

Faced with annual Super Rugby losses of Aus$15 million (£8.4 million), the report calls for drastic action. "Picking up another few million in a revised broadcast agreement is not going to change the situation in any material way. And trying to pull it out of expenses by depressing player income or cutting out an Australian Super Rugby team is going to lose more talent and more audience, and thus more revenue.

"Unless New Zealand or South Africa are prepared to seriously rebalance the distribution of Super Rugby revenue … or the [IRB] is willing to tip in the requisite amount, then Australia needs a dramatically changed competition structure geared to providing the volume of product, which is attractive to Australian audiences, to generate the necessary revenue."

The conclusion is grim reading for Australia's Super Rugby partners. "The inescapable strategic issue is the absence, under the current and proposed Super Rugby competition structure, of sufficient locally attractive matches to generate the revenue needed to pay for Australian Super Rugby teams. Either the management of Australian rugby has the courage to face up to that reality and force change with its SANZAR partners, or it will continue over the precipice it has now reached."

© ESPN Sports Media Ltd

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