New Zealand told to build a bigger stadium by England boss Ian Ritchie!

http://www.walesonline.co.uk/sport/rugby/rugby-news/new-zealand-blacks-told-go-11972580

England boss Ian Ritchie, having already given warning the RFU will torpedo any radical plan to move the autumn internationals or the Six Nations, has fired another in the direction of the southern hemisphere.

The New Zealand Rugby Union has been advised to go and build a bigger stadium if it wants to generate more income as the row over introducing a global season intensifies.

England boss Ian Ritchie, having already given warning the RFU will torpedo any radical plan to move the autumn internationals or the Six Nations, has fired another in the direction of the southern hemisphere.

Unions kings New Zealand have allegedly demanded half of the matchday revenue generated when they come to Europe to face the likes of Wales and England in fixtures following the 2019 World Cup.

There aren’t any tours in place after that tournament and the back-to-back world champion All Blacks have demanded cash to play at the Principality Stadium, Twickenham and the like.

New Zealand, Australia and South Africa want to increase their income to help fund the professional game in those countries.

NZRU boss chief executive Steve Tew has indicated the back-to-back World Cup holders will hold the northern hemisphere to ransom and seek individual fixtures if the sport’s leaders cannot reach a deal on the thorny issue of introducing a global season.

“We need a different season structure than we have now and we’re not going to default to the current one. We’re going to force that issue,” he declared.

“People will have to come to the table and we’ll negotiate individual matches in 2020.”

Tew claimed, without a compromise, there wouldn’t be a window for the Lions to tour or a World Cup.

But the sport’s most powerful and richest union, England, isn’t prepared to dance to the Kiwi tune, according to its chief executive Ritchie.

“When we went down there (Australia) for the three Test matches in June, we got no money at all,” he pointed out.

“They get the gate money and TV money and that’s the same for Lions tours as well, so I’m not sure I get this argument.

“I didn’t ask for a revenue share from Australia. And ditto from the Lions, so I don’t see why there is a particularly strong case for arguing the other way.

“If we manage to sell out 82,000 at Twickenham because of our efforts and because we’ve invested in the stadium, that’s something we’ve rightly invested in.

“If you look at the amount of money the RFU has spent on Twickenham since it was conceived, well then of course we should get a return on that.

“Of course they would say they want more money but there is nothing to stop Australia or New Zealand building a stadium.”

And Ritchie suggested: “Go and build a stadium if you want to increase your revenue growth.

“We’ve all been through it – Wales, Ireland and Scotland too. You incur some debt in stadium build and then you reap the benefits of that. We keep what we make to put back into the game.”

Ritchie hinted England may stop paying countries to play them outside the autumn World Rugby Test window, as has been the case.

“If you throw everything up in the air you might say: ‘Why would you pay that?’” he said.

Wales have also paid 'start money' to opponents so they can stage an extra autumn Test with cash-strapped Australia and South Africa having benefited from the policy.

Ritchie again dismissed the notion of a unified global season, saying: “As I understand it the southern hemisphere don’t want to play in their summer and neither do we, so bringing those calendars together becomes very difficult.

“We still see rugby as a winter sport. The Six Nations and the autumn internationals are important bed-rocks, so we don’t anticipate change there.

“The Six Nations, as far as the date in the calendar is concerned, works well. We have a great TV deal and we have stadia that are filled for every game.

“Why would you want to change something that works really well? So I can’t see there being any significant move in that.

“And I think as well that the autumn internationals work terribly well for us as well. The focus of discussion is on the summer (June), although one year will be a Lions and another a World Cup. Discussions are ongoing.”

Rugby’s leading decision-makers, including top officials from the WRU, have been in Buenos Aires, Argentina for a series of key World Rugby committee meetings to discuss and formulate policy.

WRU chairman Gareth Davies said, in the wake of Wales’ summer tour of New Zealand, the Six Nations didn’t need to be moved “for the sake of it” because it works where it is now (February and March).

But he added: “if it were necessary to move it in order that it were a piece of the jigsaw that enabled northern and southern hemispheres to have a coherent global season, then it’s worth doing.”

Union chief executive Martyn Phillips had said: “I have an open mind and people ask me about changing to summer rugby, moving the Six Nations tournament and altering the format.

“My whole philosophy is you review everything all the time so I’d review the Six Nations every year.

“There are a lot of conversations about the global season and we’re looking to make things better and the logical season for players and supporters.

“People have been very open about their views and there won’t be a solution for everyone because of the two different hemispheres.”

Pretty much along the lines of what most people in the northern hemisphere think. Invest in a new / upgraded stadium like the old 5 Nations teams have and stop playing games to 20k seater stadiums that generate peanuts.

Nice to see the empire striking back from the Nz rhetoric.

This is old news.

Happy to play Georgia, Japan, USA or Canada instead of England, along with Australia, South Africa and Argentina. Probably good for the game. Probably a good choice. England players get all of June off. England get to experiment in  November against teams like Moldovia, Iraq and Honduras. England may have to tour Moldovia, Iraq and Honduras. However they can do this with a E side. Everybody is happy, including the 15 people that turn up to Twickenham and the 32 that watch the games on Sky.

Have other countries come out in support of NZR's proposal? I expected other SANZAAR countries to back them up (especially Australia) but haven't really heard anything from them.

The issue being there ungrey ghost is that England would still get more than 15 people and suddenly you would have the Georgian union etc facing more costs for less reward should they face NZ. Clearly just saying lets share the profits is a non starter considering the home teams pay for the construction of the stadiums and upkeep of pitch, bills etc. Finances do need looking at though if some teams can't afford to live at the standards they have come to expect; hard to say the solution. Pay the players less and live to their means but risk more players jumping to France?

No 7&1/2 wrote:The issue being there ungrey ghost is that England would still get more than 15 people and suddenly you would have the Georgian union etc facing more costs for less reward should they face NZ. Clearly just saying lets share the profits is a non starter considering the home teams pay for the construction of the stadiums and upkeep of pitch, bills etc. Finances do need looking at though if some teams can't afford to live at the standards they have come to expect; hard to say the solution. Pay the players less and live to their means but risk more players jumping to France?

Not as much of an issue for Georgia and NZ as you think. We could play them in a small football stadium in London. I'm actually over England and the RFU's negativity and self interest. For the first time since 1981 I have no interest in NZ playing another nation. There is effectively no gain to playing England at the moment but plenty of negatives. It pains me to say this because I'm part English, 1/2 my extended family live in the UK.

I have no interest in touring Europe or hosting 6 nations teams if it involves the status quo. I'd rather we looked at regular games against Canada, USA, Japan, the Pacific Islands etc and sacrificed some or all of the 6 nations games. At the moment we're just subsidising European clubs. I'm not sure inbound European tours generate much money for us any way (excluding the Lions, and I'm not sure they'll last).

Erm, think you have a misunderstanding there like! You're not subsidising the NH at all, that's the area where the money is made.

If the NZRU and other SH unions decide to stop touring Europe then it's pretty safe that , at some point, some promoter will start to organize games between SH and 6N countries be it in Wembley, Hong Kong or anywhere in this world where it can generate serious cash. that's how things works, if you create a void in a market, be sure that it will be filled sooner or later.

No 7&1/2 wrote:Erm, think you have a misunderstanding there like! You're not subsidising the NH at all, that's the area where the money is made.

The NH is without doubt where the money is made. However payments to clubs from the RFU (gained from international revenues) is an important component of many clubs finances. E.g. the RFU current deal is, I think, 112 million pounds to premier clubs over 4 years for player release. Much of that money effectively goes to recruiting foreign players. As far as I'm concerned it's a subsidy.

I don't see NZ as having much of a choice to be honest. The current model will probably see NZ rugby die. Better to try something else.

whocares wrote:If the NZRU and other SH unions decide to stop touring Europe then it's pretty safe that , at some point, some promoter will start to organize games between SH and 6N countries be it in Wembley, Hong Kong or anywhere in this world where it can generate serious cash. that's how things works, if you create a void in a market, be sure that it will be filled sooner or later.

Sounds fine. Both sides get an appearance fee.

Wouldn't be able to do it without the unions say so unless they broke away somehow. More likely club games would take over.

Not grey and not a ghost wrote:

No 7&1/2 wrote:Erm, think you have a misunderstanding there like! You're not subsidising the NH at all, that's the area where the money is made.

The NH is without doubt where the money is made. However payments to clubs from the RFU (gained from international revenues) is an important component of many clubs finances. E.g. the RFU current deal is, I think, 112 million pounds to premier clubs over 4 years for player release. Much of that money effectively goes to recruiting foreign players. As far as I'm concerned it's a subsidy.

I don't see NZ as having much of a choice to be honest. The current model will probably see NZ rugby die. Better to try something else.

Your point would hold weight if everyone stopped touring. NZ alone wouldn't affect much, if anything.

No 7&1/2 wrote:

Not grey and not a ghost wrote:

No 7&1/2 wrote:Erm, think you have a misunderstanding there like! You're not subsidising the NH at all, that's the area where the money is made.

The NH is without doubt where the money is made. However payments to clubs from the RFU (gained from international revenues) is an important component of many clubs finances. E.g. the RFU current deal is, I think, 112 million pounds to premier clubs over 4 years for player release. Much of that money effectively goes to recruiting foreign players. As far as I'm concerned it's a subsidy.

I don't see NZ as having much of a choice to be honest. The current model will probably see NZ rugby die. Better to try something else.

Your point would hold weight if everyone stopped touring. NZ alone wouldn't affect much, if anything.

As I said we're dead if it stays the status quo. So we have nothing to lose. I suspect that behind the scenes it's not just NZ.

Like I said, if an issue like this is raised WR have a responsibility to look at it and decide. It's just not going to be a split of income from AIs though. Obviously not an easy solution or it would have been done already.3 solutions currently could be: share revenue (though no talk of sharing costs yet), NZ et al build bigger stadia/charge more or they pay their players/staff etc less.

Not great options, must be more?

No 7&1/2 wrote:Like I said, if an issue like this is raised WR have a responsibility to look at it and decide. It's just not going to be a split of income from AIs though. Obviously not an easy solution or it would have been  done already.3 solutions currently could be: share revenue (though no talk of sharing costs yet), NZ et al build bigger stadia/charge more or they pay their players/staff etc less.

Not great options, must be more?

Sure. Just remember it's not written in stone that anyone has to tour. It's an economic model that's only going one way. Sharing revenue would also make teams like the Samoa, Fiji, Tonga and Georgia more viable.

Yes, no one has to tour, and I'm pretty sure that the NH clubs would welcome it very much. Again talk of revenue sharing is all well and good while ignoring costs.

Let's look at the facts, shall we?

Using Australian figures because they break out matchday revenue and the NZRU don't. The recent England tour of Australia had a total attendance of 122,769, 97% of the capacity of the venues used. Given that one of the venues only has a capacity of 30,000 it's reasonable to assume that they could have sold nearer 150,000 if all the stadia had 50,000 capacity.

Average ticket price looks to have been around AU$140, so that's revenue of AUS$17m from ticket sales alone. Add in merchandise, hospitality and catering and I would expect to double that.

The ARU's total attendance at home games in 2014 (the last non-RWC season for which the annual report is available) was 257,907. The three game tour by France accounted for around half of that. Total matchday income was only reported as AU$34m, which is surprising as it suggests that either they have been giving lots of tickets away cheaply or they're making very little on merch and catering.

Total revenue was AU$102m - so inbound tours are around 17% of total revenue before you factor in broadcasting and sponsorships. Even if you only attribute 10% of broadcast and sponsorship revenue to inbound tours, that would make their total contribution about 22% of total income. That's a huge deal.

If you look at the RFU's accounts, they made £28m from broadcast, £26.2m from tickets and £24.1m from sponsorship in 2014 - similar proportions to the ARU. But they made £36.8m from hospitality and catering - while the ARU appear to have made AU$0.

They sold 1.1m tickets for games at Twickenham, about half of which will have been International matches. 30% of those will have come from the 4 AIs, assuming a sold out stadium each time - so it's significant, but it's proportionally not as big a share as for the ARU.

Short answer:
- NH tours are a major contributor to SH income
- SH tours are a major contributor to NH income - much more in absolute terms, but proportionally smaller
- The NH (well, the RFU at least) make more money because
a) the stadiums have more capacity so they can sell more tickets and
b) their commercial model is better because for some reason they make money on catering while the SH teams appear not to.

The RFU has a structural advantage over most other nations in that it owns Twickenham outright and has total control over its revenues from all games and all other events (it's also used for concerts, for instance). But that's because it has invested in the ground and infrastructure over the last 100 years.

I fail to see how it constitutes "negativity and self interest" to want to benefit from that investment. It's the NZRU who are trying to overturn the current model, saying "give us a ton of cash because we're the All Blacks and we're bloody wonderful and you can't live without us". To which the RFU are saying "Actually, old chap, we're pretty sure we can live without you, courtesy of our careful investment in our business over the years. Perhaps if you did something similar you wouldn't need our money so badly?"

The truth is, a world where England don't play the ABs would be poorer for it, and both sides know it. So it becomes a commercial negotiation. How much is it worth the RFU to have that game, and how much does it cost them to set that precedent? Not 50% of revenues, clearly.

yes the RFU has clearly a big advantage as they own their big stadium (contrary to the FFR who gets robbed each time they play in the Stade de France) but that would be their downfall as they probably rely on that money for other things while the likes of the FFR would probably makes the same by charging clubs more in exchange of not having those extra games in the autumn and summer.

in any case, Poorfour is right, this is just a the prelude of a commercial negotiation when one party wants to appear ready to break all relationship and be seen as having a strengthened position. In the end it all come down to knowing what's yours and theirs best alternative.

Does any one know how much it cost to build Twickenham, Murreyfield and that new Irish stadium?

In fact the Irish model shows you can make even more money from your own stadium as they sold the name as well right? Which must be worth a fair bit?

Poorfour wrote:Let's look at the facts, shall we?

Using Australian figures because they break out matchday revenue and the NZRU don't. The recent England tour of Australia had a total attendance of 122,769, 97% of the capacity of the venues used. Given that one of the venues only has a capacity of 30,000 it's reasonable to assume that they could have sold nearer 150,000 if all the stadia had 50,000 capacity.

Average ticket price looks to have been around AU$140, so that's revenue of AUS$17m from ticket sales alone. Add in merchandise, hospitality and catering and I would expect to double that.

The ARU's total attendance at home games in 2014 (the last non-RWC season for which the annual report is available) was 257,907. The three game tour by France accounted for around half of that. Total matchday income was only reported as AU$34m, which is surprising as it suggests that either they have been giving lots of tickets away cheaply or they're making very little on merch and catering.

Total revenue was AU$102m - so inbound tours are around 17% of total revenue before you factor in broadcasting and sponsorships. Even if you only attribute 10% of broadcast and sponsorship revenue to inbound tours, that would make their total contribution about 22% of total income. That's a huge deal.

If you look at the RFU's accounts, they made £28m from broadcast, £26.2m from tickets and £24.1m from sponsorship in 2014 - similar proportions to the ARU. But they made £36.8m from hospitality and catering - while the ARU appear to have made AU$0.

They sold 1.1m tickets for games at Twickenham, about half of which will have been International matches. 30% of those will have come from the 4 AIs, assuming a sold out stadium each time - so it's significant, but it's proportionally not as big a share as for the ARU.

Short answer:
- NH tours are a major contributor to SH income
- SH tours are a major contributor to NH income - much more in absolute terms, but proportionally smaller
- The NH (well, the RFU at least) make more money because
a) the stadiums have more capacity so they can sell more tickets and
b) their commercial model is better because for some reason they make money on catering while the SH teams appear not to.

The RFU has a structural advantage over most other nations in that it owns Twickenham outright and has total control over its revenues from all games and all other events (it's also used for concerts, for instance). But that's because it has invested in the ground and infrastructure over the last 100 years.

I fail to see how it constitutes "negativity and self interest" to want to benefit from that investment. It's the NZRU who are trying to overturn the current model, saying "give us a ton of cash because we're the All Blacks and we're bloody wonderful and you can't live without us". To which the RFU are saying "Actually, old chap, we're pretty sure we can live without you, courtesy of our careful investment in our business over the years. Perhaps if you did something similar you wouldn't need our money so badly?"

The truth is, a world where England don't play the ABs would be poorer for it, and both sides know it. So it becomes a commercial negotiation. How much is it worth the RFU to have that game, and how much does it cost them to set that precedent? Not 50% of revenues, clearly.

A matter of opinion. The future tour arrangements will see only 2 June tours (there have been 3 up until now). One of those is a Lions tour. This means England will only tour once every 12 years anyway. That's assuming the tours aren't modified in the interim. Either way, I suspect the SH teams will all look at alternatives to the November tours in 2019.

Not Grey, I assume that you think the way around is 50 50 split of profits made then?

No 7&1/2 wrote:Not Grey, I assume that you think the way around is 50 50 split of profits made then?

I'm not sure what the way around is to be honest. The current model runs the very real risk of killing international rugby (I think it's had a good start). I don't think it would be as much of an issue if the unions and professional clubs were financially disconnected. It would be much better for the game if a team like Fiji could afford to pay and access their players. They can't do that at the moment. They can't generate sufficient income at home and well attended games overseas generate no income for the union. Ergo they lose players to rugby league, and pretty much every major playing nation. Additionally, they can't access their foreign based players, pay for quality coaches, and their teams are therefore poorly prepared. If they got a bigger cut of the money they generate they'd be a far more competitive team and probably also generate more interest and sponsorship.

So there's something to be said for WR to ensure that global profits are filtered down to developing nations (like it or not Figi probably fit that term) but even then they've shown in the past that the money sometimes trickles where it wasn't intended to.

Not grey and not a ghost wrote:A matter of opinion. The future tour arrangements will see only 2 June tours (there have been 3 up until now). One of those is a Lions tour. This means England will only tour once every 12 years anyway. That's assuming the tours aren't modified in the interim. Either way, I suspect the SH teams will all look at alternatives to the November tours in 2019.

Sorry, I'm struggling a bit to see how anything I posted was a matter of opinion. The closest thing was the statement that it's not worth 50% of revenues for the RFU to host NZ, which was a factual restatement of the RFU's clearly articulated negotiating position.

Anyway, one in every three cycles is a Lions tour; over the course of 12 years, each of SA, NZ and Aus country would see one Lions tour and 5 conventional NH tours. Assuming Scotland continue to play 2nd tier nations on tour, you'd expect to see England tour every 10 years rather than every 6 under a 3 tours arrangement.

In terms of the future touring arrangements, well yes, I can see how losing 1/3 of touring revenue would be a bit of a blow for the SH teams, and I can see how that would make them look for ways to replace that revenue. They will undoubtedly try to negotiate at least some sort of fee or revenue share.

I'd even go so far as to say that given this is being done for the sake of player welfare, some sort of revenue sharing agreement would be appropriate. We need reduce the stress on players, and it hurts global revenues the least to cut a summer tour - the SH therefore lose profits from those tours, and there should be compensation for that.

It doesn't remotely justify 50% of revenue or even 50% of profits, though. An equitable start point would be to look at the global reduction in profit on ticket sales and perhaps broadcast rights, and share the pain roughly evenly across all the top tier nations. Merch and catering stays outside that, because everyone has their own arrangements.

Poorfour wrote:

Not grey and not a ghost wrote:A matter of opinion. The future tour arrangements will see only 2 June tours (there have been 3 up until now). One of those is a Lions tour. This means England will only tour once every 12 years anyway. That's assuming the tours aren't modified in the interim. Either way, I suspect the SH teams will all look at alternatives to the November tours in 2019.

Sorry, I'm struggling a bit to see how anything I posted was a matter of opinion. The closest thing was the statement that it's not worth 50% of revenues for the RFU to host NZ, which was a factual restatement of the RFU's clearly articulated negotiating position.

Anyway, one in every three cycles is a Lions tour; over the course of 12 years, each of SA, NZ and Aus country would see one Lions tour and 5 conventional NH tours. Assuming Scotland continue to play 2nd tier nations on tour, you'd expect to see England tour every 10 years rather than every 6 under a 3 tours arrangement.

In terms of the future touring arrangements, well yes, I can see how losing 1/3 of touring revenue would be a bit of a blow for the SH teams, and I can see how that would make them look for ways to replace that revenue. They will undoubtedly try to negotiate at least some sort of fee or revenue share.

I'd even go so far as to say that given this is being done for the sake of player welfare, some sort of revenue sharing agreement would be appropriate. We need reduce the stress on players, and it hurts global revenues the least to cut a summer tour - the SH therefore lose profits from those tours, and there should be compensation for that.

It doesn't remotely justify 50% of revenue or even 50% of profits, though. An equitable start point would be to look at the global reduction in profit on ticket sales and perhaps broadcast rights, and share the pain roughly evenly across all the top tier nations. Merch and catering stays outside that, because everyone has their own arrangements.

Eg

"The RFU has a structural advantage over most other nations in that it owns Twickenham outright and has total control over its revenues from all games and all other events (it's also used for concerts, for instance). But that's because it has invested in the ground and infrastructure over the last 100 years.

I fail to see how it constitutes "negativity and self interest" to want to benefit from that investment. It's the NZRU who are trying to overturn the current model, saying "give us a ton of cash because we're the All Blacks and we're bloody wonderful and you can't live without us". To which the RFU are saying "Actually, old chap, we're pretty sure we can live without you, courtesy of our careful investment in our business over the years. Perhaps if you did something similar you wouldn't need our money so badly?"

The truth is, a world where England don't play the ABs would be poorer for it, and both sides know it. So it becomes a commercial negotiation. How much is it worth the RFU to have that game, and how much does it cost them to set that precedent? Not 50% of revenues, clearly."

As a few examples, each of the above paragraphs is a matter of opinion. No offense intended. This site is about opinions.

Mine would be.
England's primary advantage lies in the size of it's population, the relatively low cost of running tournaments in the UK, and the primacy of it's control of the IRB for most of it's history. NZ cannot generate the same sort of income, in the same way Fiji and Samoa can't. NZ, the Islands and Australia are also directly preyed upon by rugby league

Negativity and self interest is a matter of perspective. I don't think NZ (or the other SH nations) can afford to play England under the current arrangements. It's a bit like giving your cousin a knife you've bought, knowing he's going to fatally stab you. It's not a question of saying we're great pay us more. It's a case of saying we can't do this, this way any more because it'll kill us.

Lastly, rugby without England NZ would be poorer. But it might save the game down here. In terms of myself. The RFU's approach has made me question whether I actually value the contact. If I'm truthful I'd say I can quite happily live without seeing another England NZ rugby test. I can't say I feel that about any other nation. The only other time I've felt this way was during the 81 Springbok tour.

Why only England here? Is it just because they make the most money? I assume the demand for sharing profits also extends to SA et al? Surely if NZ are struggling for money the easiest short term solution is pay players and staff less?

No 7&1/2 wrote:Why only England here? Is it just because they make the most money? I assume the demand for sharing profits also extends to SA et al? Surely if NZ are struggling for money the easiest short term solution is pay players and staff less?

That's my issue as well. England do have advantages, but why does everyone paint them as the ones at fault?

I don't see the same level of criticism levelled at France, who if anything should have even more advantage: they have a larger population and a higher GDP per capita, for instance. Could it be because the RFU makes more money? The FFR makes about 100m Euros per annum and a small profit but doesn't seem to make the significant investments in grass roots rugby that the RFU does.

By the way:

The RFU has a structural advantage over most other nations [ARGUABLY AN OPINION, BUT I DOUBT ANYONE WOULD DISAGREE]
in that it owns Twickenham outright and has total control over its revenues from all games and all other events (it's also used for concerts, for instance). [FACTUAL STATEMENT]
But that's because it has invested in the ground and infrastructure over the last 100 years. [FACTUAL STATEMENT]

I fail to see how it constitutes "negativity and self interest" to want to benefit from that investment. [ARGUABLY AN OPINION, BUT IT'S GENERALLY ACCEPTED AS A PRINCIPLE OF MODERN SOCIETY THAT SOMEONE WHO INVESTS IN SOMETHING SHOULD ENJOY THE BENEFITS OF THAT INVESTMENT IN PREFERENCE TO SOMEONE WHO HASN'T INVESTED. ALSO, STRICTLY SPEAKING, "I fail to see" MAKES THIS A FACTUAL STATEMENT ABOUT MY ARGUABLE OPINION, BECAUSE I DO FAIL TO SEE]

It's the NZRU who are trying to overturn the current model, [FACTUAL STATEMENT]
saying "give us a ton of cash because we're the All Blacks and we're bloody wonderful and you can't live without us". [PARODY OF FACTUAL STATEMENT]
To which the RFU are saying "Actually, old chap, we're pretty sure we can live without you, courtesy of our careful investment in our business over the years. Perhaps if you did something similar you wouldn't need our money so badly?" [PARODY OF FACTUAL STATEMENT]

The truth is, a world where England don't play the ABs would be poorer for it, and both sides know it. [OK, OPINION, BUT SO WIDELY ACCEPTED AS TO BE ALMOST A FACT]

So it becomes a commercial negotiation. [FACTUAL STATEMENT]
How much is it worth the RFU to have that game, and how much does it cost them to set that precedent? [QUESTIONS]
Not 50% of revenues, clearly. [FACTUAL STATEMENT - THE RFU HAVE INDICATED THAT THIS IS AN UNACCEPTABLE COMMERCIAL PROPOSITION]

opinion
əˈpɪnjən/Submit
noun
1.
a view or judgement formed about something, not necessarily based on fact or knowledge.

Poorfour wrote: I don't see the same level of criticism levelled at France, who if anything should have even more advantage: they have a larger population and a higher GDP per capita, for instance. Could it be because the RFU makes more money? The FFR makes about 100m Euros per annum and a small profit but doesn't seem to make the significant investments in grass roots rugby that the RFU does.

FFR budget is available on internet for anyone who dares to use google.
2016/2017 budget in a nutshell :
-turnover of 114-115 M€, net Income of 200k€
- out of those 114M€ spent, 60M€ are for rugby development , rest are costs
-the bulk of the money is made through sponsors and tv rights (73 M€) with ticket revenues contribution being a mere 21M€ (and if you remove the cost associated to that we would go down below 10M€).

So the bottom line is that the FFR money is reinvested in amateur rugby (but the costs remain quite high) and that most of it comes from tv rights (mainly from the TOP14 by the way). Gate tickets income is relatively small but given they don't own their stadium it is natural so probably not much to share (or to lose).

But why is fair for France to keep that money? They should give it to NZ, Samoa etc.

what money? all of it or just the net tickets income from the AIs? I doubt the latter would be that much considering the burden that is Stade de France.
On a side note aren't touring teams like the PIs helped by the IRB to cover part of their costs?

To be honest am not against it but it would have to work both ways (we get a share of whatever is made in the summer tours) and find the right split. If I remember correctly this is how it also worked in the Heineken cup for QFs and SFs (ie home team keeping 50 to 60% of the gate receipts).

So it basically comes down to England make money through successful business model and that needs to be shared around to everyone despite those parties not contributing to outlay etc. No one else makes enough money to share.

No 7&1/2 wrote:So it basically comes down to England make money through successful business model  and that needs to be shared around to everyone despite those parties not contributing to outlay etc. No one else makes enough money to share.

Yes we are b@stards and because we have a successful business model we are ruining world rugby....

whocares wrote:

Poorfour wrote: I don't see the same level of criticism levelled at France, who if anything should have even more advantage: they have a larger population and a higher GDP per capita, for instance. Could it be because the RFU makes more money? The FFR makes about 100m Euros per annum and a small profit but doesn't seem to make the significant investments in grass roots rugby that the RFU does.

FFR budget is available on internet for anyone who dares to use google.
2016/2017 budget in a nutshell :
-turnover of 114-115 M€, net Income of 200k€
- out of those 114M€ spent, 60M€ are for rugby development , rest are costs
-the bulk of the money is made through sponsors and tv rights (73 M€) with ticket revenues contribution being a mere 21M€ (and if you remove the cost associated to that we would go down below 10M€).

So the bottom line is that the FFR money is reinvested in amateur rugby (but the costs remain quite high) and that most of it comes from tv rights (mainly from the TOP14 by the way). Gate tickets income is relatively small but given they don't own their stadium it is natural so probably not much to share (or to lose).

I did look at the 2014 annual report - for consistency with the other countries - which is where I got 100m Euro. I couldn't see anything that looked like 60m Euro grassroots investment, though it may have been spread across the expense lines (which included 16m on sub-contractors, 18m on transport!, 15m on employment costs and 20m on "other operating expenses")

yappysnap wrote:Does any one know how much it cost to build Twickenham, Murreyfield and that new Irish stadium?

In fact the Irish model shows you can make even more money from your own stadium as they sold the name as well right? Which must be worth a fair bit?

Well Irish Rugby shares rights to the stadium with Irish Football (FAI) - who ...kinda.... paid their share of the building costs. I say 'kinda' in that I think it was much less than the IRFU share - and because of the shortfall, the name Lansdowne disappeared and the new name was granted. I think it was pressure from the FAI to have a naming rights contract so that they could somehow cover 'their percentage' of the funding deal, which they couldn't really meet in full. So for bringing that new name to Lansdowne.. f**k the FAI

Someone (Sin) might come in and prove that all wrong but that's largely how I remember it.

Poorfour wrote:

whocares wrote:

Poorfour wrote: I don't see the same level of criticism levelled at France, who if anything should have even more advantage: they have a larger population and a higher GDP per capita, for instance. Could it be because the RFU makes more money? The FFR makes about 100m Euros per annum and a small profit but doesn't seem to make the significant investments in grass roots rugby that the RFU does.

FFR budget is available on internet for anyone who dares to use google.
2016/2017 budget in a nutshell :
-turnover of 114-115 M€, net Income of 200k€
- out of those 114M€ spent, 60M€ are for rugby development , rest are costs
-the bulk of the money is made through sponsors and tv rights (73 M€) with ticket revenues contribution being a mere 21M€ (and if you remove the cost associated to that we would go down below 10M€).

So the bottom line is that the FFR money is reinvested in amateur rugby (but the costs remain quite high) and that most of it comes from tv rights (mainly from the TOP14 by the way). Gate tickets income is relatively small but given they don't own their stadium it is natural so probably not much to share (or to lose).

I did look at the 2014 annual report - for consistency with the other countries - which is where I got 100m Euro. I couldn't see anything that looked like 60m Euro grassroots investment, though it may have been spread across the expense lines (which included 16m on sub-contractors, 18m on transport!, 15m on employment costs and 20m on "other operating expenses")

tks Poorfour, Mine were budget figures so quite not actual numbers.
sadly the FFR operating expenses are probably by far the heaviest in the "industry" as it must include a lot of "banquets" and other type of hospitalities (4.4M€ just for their HQ in Marcoussis).

From memory, I thought the South Stand redevelopment cost £300m, but I have only been able to find a reference to a £100m project from one contractor.

The pre-RWC revamp of the stadium cost £55m, and according to The Secret Life of Twickenham the RFU spent £250k each on two "special projects" when developing the West Stand - the statues on the gates and a wine cellar for storing gifts from visiting unions. The latter has apparently turned out to be a very wise investment.

Just out of curiosity, What happens this weekend? Does England share any of its profits with Argentina and/or Australia?

Don't NZ get it all?

yappysnap wrote:Don't NZ get it all?

Its a great thing this Old Mutual Wealth business.

I would imagine there will be a whip-round at half time. Perhaps put poignant images of cash-strapped All Blacks on the big screen with Coldplay on in the background.

aucklandlaurie wrote:
Just out of curiosity, What happens this weekend? Does England share any of its profits with Argentina and/or Australia?

The most likely scenario is that whoever is nominally the home team (Australia) will have hired the stadium from the RFU and will take the ticket revenue. The RFU will probably keep most of the catering and beer revenue, so I imagine the stadium hire cost will be pretty light.

Quins used to reckon that at 50k tickets they would make the same money from Twickenham that they did at the Stoop (at 14k), but that everything beyond that was essentially pure profit, even with the top two tiers at £10 per head. This week's tickets are £20 for the top two tiers and £27-90 for the lower tier, so my guess is that the pricing has been set so that if they fill the bottom tier it will be equivalent to a normal home game for Australia and anything over and above that is pure profit.

In terms of costs, since the ARU have to rent any stadium they use anyway, I suspect the cost differences between this and playing at home are pretty marginal - more expensive flights and bigger hotel bills for the squad.

Likewise for Argentina, they'd have to fly somewhere to play anyway, and the flight time and time zone difference are considerably less. I doubt they'd want any extra for playing here rather than somewhere in Oz.

The more I think about it, the more economic sense it makes. Y'know, NZ could do something similar. Why build a bigger stadium when you could rent one?

Poorfour wrote:

aucklandlaurie wrote:
Just out of curiosity, What happens this weekend? Does England share any of its profits with Argentina and/or Australia?

The most likely scenario is that whoever is nominally the home team (Australia) will have hired the stadium from the RFU and will take the ticket revenue. The RFU will probably keep most of the catering and beer revenue, so I imagine the stadium hire cost will be pretty light.

Quins used to reckon that at 50k tickets they would make the same money from Twickenham that they did at the Stoop (at 14k), but that everything beyond that was essentially pure profit, even with the top two tiers at £10 per head. This week's tickets are £20 for the top two tiers and £27-90 for the lower tier, so my guess is that the pricing has been set so that if they fill the bottom tier it will be equivalent to a normal home game for Australia and anything over and above that is pure profit.

In terms of costs, since the ARU have to rent any stadium they use anyway, I suspect the cost differences between this and playing at home are pretty marginal - more expensive flights and bigger hotel bills for the squad.

Likewise for Argentina, they'd have to fly somewhere to play anyway, and the flight time and time zone difference are considerably less. I doubt they'd want any extra for playing here rather than somewhere in Oz.

The more I think about it, the more economic sense it makes. Y'know, NZ could do something similar. Why build a bigger stadium when you could rent one?

Dont understand any of that, surely Argentina are only travelling so that they get a share of the profits?

Not grey and not a ghost wrote:
England's primary advantage lies in the size of it's population, the relatively low cost of running tournaments in the UK, and the primacy of it's control of the IRB for most of it's history.

Why is it cheaper to run a tournament in the UK? Generally the UK is one of the most expensive places to do business and London where England play is one of the most expensive cities in the world.

Not grey and not a ghost wrote:
NZ cannot generate the same sort of income, in the same way Fiji and Samoa can't. NZ, the Islands and Australia are also directly preyed upon by rugby league

NZ cannot generate the same sort of income but they do not need to as they have a smaller club game to support. They could easily generate more income if they played all their games at their largest stadium as most NH countries do. If they invested in a larger stadium they could make yet more.

aucklandlaurie wrote:

Poorfour wrote:

aucklandlaurie wrote:
Just out of curiosity, What happens this weekend? Does England share any of its profits with Argentina and/or Australia?

The most likely scenario is that whoever is nominally the home team (Australia) will have hired the stadium from the RFU and will take the ticket revenue. The RFU will probably keep most of the catering and beer revenue, so I imagine the stadium hire cost will be pretty light.

Quins used to reckon that at 50k tickets they would make the same money from Twickenham that they did at the Stoop (at 14k), but that everything beyond that was essentially pure profit, even with the top two tiers at £10 per head. This week's tickets are £20 for the top two tiers and £27-90 for the lower tier, so my guess is that the pricing has been set so that if they fill the bottom tier it will be equivalent to a normal home game for Australia and anything over and above that is pure profit.

In terms of costs, since the ARU have to rent any stadium they use anyway, I suspect the cost differences between this and playing at home are pretty marginal - more expensive flights and bigger hotel bills for the squad.

Likewise for Argentina, they'd have to fly somewhere to play anyway, and the flight time and time zone difference are considerably less. I doubt they'd want any extra for playing here rather than somewhere in Oz.

The more I think about it, the more economic sense it makes. Y'know, NZ could do something similar. Why build a bigger stadium when you could rent one?

Dont understand any of that, surely Argentina are only travelling so that they get a share of the profits?

Correct Laurie.

It's Argentina's home game. They hire the stadium from RFU. Australia's costs are the same since they'd have to pay for travel to BA otherwise.

There's a split on the hospitality and food profits.

This report from Wales Online was already covered over two weeks ago on other media. They're behind the times.

The 50% split is media guessing.

People may recall a story reported a few months ago was that NZ had asked for a larger appearance fee for their planned 4th test against England in 2017. Reportedly, NZRU were looking for £3m instead of £1.5m from likely revenues of £8-9m from the test including corporate and hospitality. The latter is a strong part of total revenues for the English RFU, more so than a lot of other nations can generate. The English RFU turned them down. The test is unlikely to go ahead now.

The proposal for revenue sharing stems in part from the desire of SANZAAR to shift June tests to July to allow their expanded Super Rugby comp to run uninterrupted. Apparently, the 6N are open to that but they also want the June tests after a RWC year to be dropped to reduce the NH season in a RWC year.

This would mean only one lot of June tours every four years. This will reduce income for SANZAAR. Hence their proposal that revenues be shared across tests. Not 50/50 but an appearance fee.

The other SANZAAR nations have been quiet on this front publicly leaving Tew to act as spokesman. Nonetheless, the ARU is in financial trouble so it can't afford to have test revenues drop further.

Argentina have taken their home game against Aus to London in the hope of generating more revenues.

In one sense, the various public statements are part of the public posturing by all parties involved as part of the negotiations on a new global season.

In my view, if there is to revenue sharing or appearance fees to be paid to visiting teams - after costs are paid - then it needs to be across all Tier One tests. That includes Mid-year and End-year tests and Lions tours.

There needs to be a minimum stadium capacity set for use on these tour games - probably 50k which matches smallest stadia in NZ and Ireland. (The current naming rights deal on Lansdowne Road stipulates all capped test matches must be played there. But that deal will end and the next one may have more flexibility).

The marketing and ticketing operations for the tests need to be agreed by both teams/unions. SANZAAR could learn a number of things from NH unions about this as the NH have better skills and expertise at it. This includes how the visiting NH tours are marketed and sold in SANZAAR nations currently, including within media. If NH teams are portrayed as inferior teams, starters before main course of RC, etc, etc, then it's not surprising the attendance numbers are falling. Putting the tests into smaller stadia doesn't hide it.

Promotion and merchandising around the tours could also be improved and there is greater potential for sharing of costs and revenue around these than currently for some unions.

No 7&1/2 wrote:But why is fair for France to keep that money? They should give it to NZ, Samoa etc.

As far as we know they're open to negotiation. With only 4 main playing nations outside the 6 nations they stand to financially gain, even if they share some of the profits if England drop out of the SH/NH autumn tours. The same is also for Ireland, Wales, Scotland and Italy. Given their costs their is the potential that the RFU could run the international game at a loss if it loses all four SH nations.

Not grey and not a ghost wrote:

No 7&1/2 wrote:But why is fair for France to keep that money? They should give it to NZ, Samoa etc.

As far as we know they're open to negotiation. With only 4 main playing nations outside the 6 nations they stand to financially gain, even if they share some of the profits if England drop out of the SH/NH autumn tours. The same is also for Ireland, Wales, Scotland and Italy. Given their costs their is the potential that the RFU could run the international game at a loss if it loses all four SH nations.

Wales, Ireland Scotland and Italy depend heavily on test revenues to run their union systems and teams. It generates 70-80% of their revenues. SANZAAR gain far more revenue from their Super Rugby competition than the PRO12 does. Wales and Scotland have less income than NZRU or ARU. Ireland is the same as NZ. SANZAAR will have a hard time to persuade them split their revenues.

My point is England drops out of the Autumn tours their is an additional three quality games to be spread between the other 6 nations teams, games against SANZAAR nations will generate more cash than the equivalent against Canada, Romania etc. I doubt the SH is looking for a 50/50 split. They also have the opportunity to gather additional cash as Ireland and NZ are doing this year in Chicago. Additionally they have the opportunity to work collaboratively with other stakeholders in the game, which helps when working through other issues and bidding for world cups.

Why would England stop playing autumn tests? Even without SANZAR they would continue and make money. If they were to make less they would have to cut their cloth accordingly surely? You seem to dislike the rfu are good at makinng money.