Rugby has no obligation to CVC – it cannot afford to get this decision wrong

There is a plan afoot to take the Six Nations behind Sky’s satellite TV paywall and to prevent terrestrial broadcasters ITV and the BBC from combining their bids, a mechanism which has kept the tournament free to air.

Let me declare an interest: I have, for 20 years, worked on the BBC’S Six Nations coverage as a pundit and a co-commentator. That said, this is a small minority of my total income, the vast majority of which comes from private media outlets. I have no reason to advocate for public over private media, unless I believe it to be in rugby’s best interests, which in this case I firmly do.

From where has this initiative come? This is rumoured to be at the prompting of CVC Capital Partners, a private equity firm which has its headquarters in Luxembourg. Amongst a myriad of investments, it is widely reported that CVC has bought a £120million stake in the Pro14, a 27 per cent holding in Premiership Rugby and is seeking to finalise a £300million deal to obtain a 14 per cent stake in the Six Nations. It also, notably, has an 80 per cent stake in Sky’s betting and gaming company.

The first point to make is that CVC has no track record in rugby and has previously expressed no interest in it as a sport. If its recent ownership of Formula One is anything to go by, it appears to be interested only on its return on investment. In 2016, the then deputy team principal of Force India summed up everything about the firm’s relationship with F1 in a single sentence: “All their actions have been taken to extract as much money from the sport as possible and put as little in as possible.”

In 2014, it is reported they took in £347million from a turnover of £1.25 billion, at that point representing a return on investment of more than 350 per cent. Between 2010 and 2019, F1’s viewing numbers are said to have fallen 137million globally.

Rugby is not like football. It is a minority sport which needs money and exposure even to stand still in the battle to survive. If you doubt this, look at what happened to cricket in the decade after 2005 when it left free-to-air television. The England and Wales Cricket Board announced record turnover,

‘All their actions have been taken to extract as much money from the sport as possible’

profit and investment in the game and a near 30 per cent drop in participation numbers. There is no reason to think the same would not happen in rugby.

Whilst CVC has invested a lot of money, it does not own a majority stake in any rugby competition. Why is it being treated as majority owner and seemingly being unchallenged over where these contracts are awarded?

The Six Nations is an extraordinary entity. Audiences of up to nine million, year on year, for a minority sport are unprecedented. Many of these viewers are not regular rugby fans, because if they were, rugby would be the national sport. They will not pay to watch in any guise and live viewing numbers will plummet. Take just one example – Sky’s peak audience for the England v New Zealand game in the autumn of 2018, arguably the biggest draw in the sport, peaked at 1.5 million.

The Six Nations committee retains majority ownership of the Six Nations; CVC has a one-seventh share. It must consider why the tournament commands such high viewings and what would happen to rugby in the northern hemisphere without that audience. It should ask itself – what obligation does it have to CVC, legal or moral, and why should it dance to the tune of equity capitalists who have no interest beyond maximising return?

At present, the competition is a category B event under the Ofcom Code on Sports and Other Listed and Designated Events and is protected provided sufficient free-to-air highlights are made available. Such broadcasts might satisfy the terms of the listing but, for rugby itself, the exposure would be nowhere near as effective as the current model, which sees England’s autumn internationals on satellite TV and the Six Nations free to air, a combination that gives cash and the mass audience needed to publicise the game.

There have already been rumours of certain games being made pay as you go and what is to stop this becoming ubiquitous if the cash stacks up for CVC? How do you think CVC will seek to use the Six Nations to leverage its ownership of Sky’s betting arm? What makes you believe that CVC has rugby’s long-term interest at heart?

Rugby cannot afford to get this decision wrong and it should remember it will have to live with the consequences of a bad choice. CVC will be long gone and on to whatever project it thinks will add to its $75 billion (£59 billion) assets.