AFL still facing 'significant' financial challenges despite agreeing TV deal
The AFL season resumption delivered a record-breaking reminder of the value of its freshly-inked TV broadcast rights, but chief executive Gillon McLachlan has warned there will still be “significant financial challenges” in coming years.
McLachlan rubber stamped his code’s revised deal on Thursday night, which included a two-year extension with the Seven Network, before rushing to the MCG to watch the Richmond Collingwood draw.
Seven reported an average audience of 1.275 million for Thursday night’s match, the biggest prime-time audience for a regular-season game in 10 years and biggest ever for a Thursdaynight game.
It came after the broadcaster committed to show the AFL and AFLW in 2023 and 2024, having also joined Foxtel in signing off on a new arrangement for the 2020-22 seasons.
Seven has told shareholders its rejigged deal will save $87m across the current contract period, while McLachlan suggested the AFL’s free-to-air rights deal with Seven will be worth an average of $146m per year across 2020-2024.
McLachlan told 3AW that clubs would be “absolutely” happy with the “fair” deal, which shores up the AFL’s main source of revenue.
However, McLachlan admitted in a statement that “we still have a long way to go before we are out of the woods financially as a football community”.
“While the agreement today provides some long-term certainty, we know COVID-19 has also impacted other revenue for the AFL and for clubs,” he said.
“We will need to be disciplined and focused as a football community on how we continue to live within our means over the coming years. Our football community still faces significant financial challenges over the coming years.”
“We must remain vigilant on balancing investment in the next generation of participants and players while maintaining discipline on costs.”
The AFL and clubs were forced to make drastic cuts after the 2020 season was suspended because of the coronavirus pandemic, with players and staff both feeling the pinch.
The league’s mobile-rights deal with Telstra remains unchanged.
McLachlan and Seven, which introduced canned crowd noise and other changes in an effort to make its broadcast more appealing compared to round one, both trumpeted Thursday night’s numbers.
Seven’s metro audience was up 70% compared to the average for Thursday night football in 2019.
“I”m trying to rub the signatures off [the TV deal],” McLachlan laughed on Friday morning. “It was massive ... a lot of people watching, which is great.”