Rugby Australia broadcast deal report reveals $15 million black hole

Rugby Australia is on its knees after an alarming report revealed the desperate state of the game's broadcast deal negotiations.

Having put together an on-the-run one-season deal with Fox Sports to broadcast the Super Rugby Australia season this year, Rugby Australia is staring at the bleak reality of a further reduction in the game's value to potential broadcast partners.

According to an exclusive report in The Australian, Rugby Australia is facing a confronting future with a domestic rugby competition now likely to be worth no more than $10 million per season.

The NRL's previous broadcast deal with Channel 9 and Foxtel before chairman Peter V'landys renegotiated an extension during the coronavirus-forced season suspension earlier this year was worth $360 million per year.

The grim outlook for the 15-a-side game means the sport is facing a broadcast deal worth just $20 million per year with Wallabies Test matches reported to be worth a further $10 million per year.

The estimated value is reported to be worth $15 million per year less than the original $35 million per year offer reportedly tabled by Foxtel to former Rugby Australia chief executive Raelene Castle in November.

Rugby Australia is on its knees after a report revealed the diabolical TV reality confronting the code. Photo / Photosport

Castle is reported to have knocked back the five-year, $125 million offer from Foxtel in the hope of manipulating a bidding war with other broadcast partners. The gamble has blown up in the code's face.

Optus was speculated to be interested in joining the negotiations, but the telecommunications company denied having any interest.

It was only 12 months ago that the code was playing out the final year of a $285 million broadcast deal with Foxtel and Channel 10, worth $57 million per year.

It leaves the new Rugby Australia board, led by new chairman Hamish McLennan, facing an impossible task — especially after the game announced a budget deficit of $9.4 million in June.

According to the Sydney Morning Herald, Rugby Australia is now considering three competition structures for the 2021 season — with one of the options being the complete dismantling of the Super Rugby concept.

The code appears to be nowhere near reaching a resolution with the New Zealand Rugby Union over talks surrounding a Trans Tasman Super Rugby competition for the 2021 season and beyond.

The report claims Rugby Australia is even considering offering the NZRU a larger share of any private investment funds that would result from a re-formatted Trans Tasman competition.