The future of NZ Rugby
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Tensions between New Zealand Rugby, Super Rugby licence holders over future of Kiwi teams
A major faultline has formed between New Zealand Rugby and the private investors of Kiwi Super Rugby clubs, on the eve of the competition's new season. At present, the Chiefs, Hurricanes, Crusaders and Highlanders all have private investors who have bought in as licensees to run major operational and marketing functions of the clubs. The Blues also had a private licensee until last year when New Zealand Rugby reacquired the licence that had been sold to NBR Richlister Murray Bolton. Super Rugby's structure reverts to straight round robin from next season onwards. That means licensees are in for reduction in revenues due to the halving of local derbies. At present each Kiwi team hosts four of these a year. From next year each will host just two. As licensees don't receive any money from television rights, they rely on ticket sales and sponsorships from those marquee matches as their bread and butter. They are demanding compensation from New Zealand Rugby to bridge the shortfall.However, 1 NEWS understands that New Zealand Rugby's proposed offer to the licence holders is unacceptable, leaving the game's administrators in a precarious position. It is understood the club's will supply their feedback on the proposal to New Zealand Rugby in the next two days. Compounding the compensation negotiation is the very nature of the license moving forward. Licensees want a move to perpetual licenses but feel New Zealand Rugby is seeking greater control while offering less consultation. Licensees are asking how they can be expected to provide investment if they don't have a say over the crucial components of what they own.New Zealand Rugby are currently engaging in a major review of the sport at all levels. 1 NEWS can reveal global consulting giant McKinsey has already begun its initial work in this area. Until that review is concluded, there is enormous uncertainty regarding the structure of competitions at every level. Should the licensees pull out of their investment, New Zealand Rugby would likely struggle to fund the five Super Rugby sides on their own, having also just lost major partners AIG.What's more, with yesterday's announcement of a new Japanese competition beginning as early as next year, New Zealand Rugby could face a major challenge in retaining their best players. Provincial Rugby insiders spoken to by 1 NEWS are even fearful that a season that includes both Super Rugby and a new Japanese league could effectively end the need for provincial rugby competition here. -
Right from the start I wondered what the licensees thought they were getting for this deal. The only reason I could think too do it is if you're rich and you like the team then buy in. Otherwise totally waste of money, they never had any control, so what was the point for the investors? Ever?
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@Machpants said in The future of NZ Super Rugby teams & the NPC:
Right from the start I wondered what the licensees thought they were getting for this deal. The only reason I could think too do it is if you're rich and you like the team then buy in. Otherwise totally waste of money, they never had any control, so what was the point for the investors? Ever?
Making a profit? Isn't that the purpose of every investment?
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@Stargazer said in The future of NZ Super Rugby teams & the NPC:
@Machpants said in The future of NZ Super Rugby teams & the NPC:
Right from the start I wondered what the licensees thought they were getting for this deal. The only reason I could think too do it is if you're rich and you like the team then buy in. Otherwise totally waste of money, they never had any control, so what was the point for the investors? Ever?
Making a profit? Isn't that the purpose of every investment?
Few people make profits from owning sports teams, especially in NZ
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@Stargazer said in The future of NZ Super Rugby teams & the NPC:
@canefan You may be right.
But it's also not really the point of the article and this thread.
I was just answering Mach's question
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@Machpants Really insightful contribution to the thread.
Do you have something interesting to say about the consequences of the private investors pulling out of their investment and the risks for the future of the NZ franchises?
Or about the possible consequences of a new Japanese competition for player retention and the NPC?
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@Stargazer said in The future of NZ Super Rugby teams & the NPC:
@Machpants Really insightful contribution to the thread.
Do you have something interesting to say about the consequences of the private investors pulling out of their investment and the risks for the future of the NZ franchises?
Or about the possible consequences of a new Japanese competition for player retention and the NPC?
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Probably not
I think the possible future Japanese problem is no worse or better than it is now, however I reserve judgement until I see details - I can't find any. Salary cap & debt woes in England, Central contacts and/or control in Ireland/Scotland/Wales, and France's push to naturalize their squad will result in reduced pressure on NZ players, long term.
The NPC for sure it's on its long slow death, at least as a professional comp. Look at the viewing numbers, both attendances and TV. The only reason it is on TV is that NZR insist if you want the ABs as well. It's a massive loss leader for sky. The bit in the article was a total throw away line/click bait. "New comp will end NPC one random insider said! Details are somewhere, but Google won't help!"
Bigger problems are participation rates in young people, and SANZAAR and it's component unions having no idea how to run an exciting completion, Ozzie rugby disappearing below the interest horizon for the public, and SA being so stuffed up (both personal safety and value of your wage wise) that their players and their clubs want to go North. So really it's a lot of own fault down here.
I feel so bazinga'd
Edited for swipe texting errors
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@Stargazer I thought many of the Euro ones ran at losses?
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@taniwharugby said in The future of NZ Super Rugby teams & the NPC:
@Stargazer I thought many of the Euro ones ran at losses?
All the English ones assist from Exeter do, and it's unsustainable. That's why the club's agreed on a cap and that deal selling half their rights.
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For a video of the news item, see in the article below. Doesn't sound good for the smaller provinces.
The initial findings of New Zealand Rugby's McKinsey review will be presented to key NZR stakeholders tomorrow, with plenty of doubt still surrounding the future of the provincial game in New Zealand. Major changes expected as New Zealand Rugby prepare to reveal McKinsey review findings. Confidential documents obtained by 1 NEWS outline a number of key areas that formed the focus for the initial stages of the review process. Included in these is the potential splitting of New Zealand Rugby into two separate entities - high performance and community, an overhaul of the Mitre 10 Cup, New Zealand's premier domestic competition, and the potential amalgamation of some provinces. While it is unclear just how specific the initial findings will be, one source has told 1 NEWS that there will be a call to concentrate the academy programme - servicing the rising stars of the game - in five major centres: Auckland, Hamilton, Wellington, Christchurch, and Dunedin. That would effectively align those provinces with the Super Rugby clubs in a move that has some fearing the emergence of five "Super Provinces." The initial findings are sure to be met with some skepticism from the regions about their long-term ability to retain local talent in their respective provinces should such a move come to fruition. New Zealand Rugby will waste no time in progressing the review after tomorrow's web-delivered address. A national roadshow will commence next week during which calls for feedback will be made. It is hoped that any recommendations of the review can be put into implementation streams as early as May this year. The urgency is real - NZR is still in protracted negotiations with the Super Rugby Club licensees, and negotiations with the Rugby Players' Association for the new Collective Agreement are set to begin in June this year. -
Much more info in this article:
It is believed that NZR's broader vision sees provincial unions in a new role where they will mostly drive participation and administer the club game at a local level, leaving Super Rugby sides with greater responsibility to manage talent identification and development of elite players. There is some suggestion that one of the recommendations will be that provinces change their priorities and see growing participation as their primary goal and more important than producing a successful Mitre 10 Cup team. A raft of concepts and new ideas will be proposed that will impact across areas such as talent identification and development, competition structures and administrative functions at provincial and national level. Effectively New Zealand is poised for a system reset where the respective roles of schools, clubs, unions, Super Rugby teams and the national body will be redefined to better achieve the common purpose of growing the sport and delivering success at the professional level.While driving down costs is part of the goal, NZR is aware that the current landscape creates conflict in areas of player development which can also act as barriers to player retention. They are also aware that an overhaul of development pathways may be required to help attract new players, with participation rates having stagnated for the last decade amid changing social patterns.What the unions are likely to hear, then, is that NZR believes there is a need for elite player development to be streamlined. That may lead to provincial unions having to abolish their own academy programmes in favour of regional centres of excellence. Currently unions and Super Rugby sides tend to compete for the same players, which drives up costs and has also led to teams targeting athletes at a younger age – often when they are in Year 12 at school – to secure their services.NZR is wary that unions could feel they are being asked to give up their identities, but the national body is understood to be conscious that the historic tribalism of the provincial game needs to be restored not destroyed. To that end, it is understood that the review will recommend that the Mitre 10 Cup continues with 14 teams, although it wouldn't be a surprise if there is subsequent discussion about whether the major unions in particular should be continuing to use major venues to host games given the vastly reduced crowds and interest in that level of rugby.https://www.nzherald.co.nz/sport/news/article.cfm?c_id=4&objectid=12312298
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@Godder and a local club focus on growth and participation. Better alignment with schools etc. Hmm wonder if 1st 15 TV coverage will keep growing while npc dies off. Maybe taking a page from college sport in the US?
Is super rugby the only viable TV content? What happens to our top tier nz-only domestic comp if its no longer viable as a broadcast product.
Big changes. Real big changes.
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@Paekakboyz NPC is already dead as a TV product, it is only aired as NZR insist on it as part of the whole rugby package. It's a massive loss, taken in isolation, for sky
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@Machpants yeah I guess I'm musing on whether it gets canned or ??
I tell you what though. I love grassroots rugby - lower quality but real club rugby from all round the country. Plus a bit of history about the clubs and stuff is cool.
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@Paekakboyz said in The future of NZ Super Rugby teams & the NPC:
@Machpants yeah I guess I'm musing on whether it gets canned or ??
I tell you what though. I love grassroots rugby - lower quality but real club rugby from all round the country. Plus a bit of history about the clubs and stuff is cool.
Me too, I'd rather have more of that, and the one camera angle, than more NPC multicamera overly costly for the support it gathers coverage
