Embarking on a dynamic transformation, New Zealand Rugby’s streaming venture, NZR+, is set for evolution under the leadership of Craig Fenton. This exclusive article delves into the platform’s strategic revamp, steering away from traditional big-budget productions to embrace a diverse content spectrum. From reshaping relationships with the illustrious All Blacks to redefining fan engagement, the narrative unfolds against the backdrop of challenges faced since NZR+’s inception.
In early December last year New Zealand Rugby (NZR) began the process of looking for what it hoped would be the sport’s version of Formula One’s Drive to Survive.
The national body sent out a Request for Proposals [RFP] for its newly launched streaming platform NZR+, hoping that one of the domestic or international production houses it invited to tender would come with a content idea that would hook fans worldwide and reposition rugby as a sport with drama, intrigue and big personalities.
“Something we wish to explore, make and release in 2024 is a truly genre-defining piece of original content that helps shape the way people engage with rugby as both a sport, but also a form of entertainment,” the summary said.
“We do not need another ‘rugby doco’ or anything exactly like Drive to Survive. We need something that transcends the sport and takes us into the mainstream, as an aspirational brand that stands for things anyone can lock onto.”
The wording around the reference to Drive to Survive was seen by production houses spoken to by the Herald as odd, and in keeping with what they felt was a confused and confusing proposal, that didn’t seem to know what it was looking for, primarily because it was trying to appeal to a disparate cohort of domestic, but mostly overseas fans.
The RFP, which revealed there was a maximum budget of $2 million to spend on content creation, was sent out two weeks after the Herald had revealed that having launched in mid-August with high hopes of winning one million registrations by the end of the World Cup, NZR+ finished the tournament with around 60,000 people signed up.
The lack of traction came despite heavy investment in content, which included a compelling behind-the-scenes documentary that lifted the lid on the All Blacks’ annus horribilis in 2022, as well as a travel show with Taika Waititi and a daily rugby offering with former and current All Blacks Andy Ellis and George Bower.
Rugby was having its big global moment but NZR+, despite its high-profile contributors, failed to get anywhere near its growth targets.
It was sobering confirmation of how difficult it was going to be for NZR to use its direct-to-consumer streaming platform to fulfil its growth ambitions of finding and engaging five million offshore All Blacks fans.
NZR’s equity partner Silver Lake is running with an investment thesis that it can use content to win and engage new fans and ultimately find ways to monetise them.
NZR+ is therefore seen as a critical indicator of both the potential power of the All Blacks’ brand and the viability of Silver Lake’s revenue growth blueprint.
Between the low take-up during the World Cup and an RFP that baffled many TV veterans, NZR+ left media industry experts wondering at the end of last year how long it will survive.
If there was a cloud hanging over NZR+, there is now a little ray of sunshine poking through, after the arrival of Craig Fenton as chief executive of New Zealand Rugby Commercial [NZRC] - the company set up to house and manage the game’s money-making properties.
NZRC operated between June and late December last year without a chief executive after Richard Thomas resigned, and as the Herald revealed a few weeks ago, neither revenue nor costs are where they were predicted to be.
Revenue has not grown in line with expectations, with suggestions that it is likely to be $50m lower than forecast a few years ago, and that costs are 25 per cent higher than anticipated.
Fenton, who announced in August last year he would be taking the role, but only starting in January, has arrived back in his homeland to take over management of a company that has clearly suffered from a lack of scrutiny and leadership.
While he’s careful not to endorse that view, he admits he’s facing a number of tough challenges in trying to build a commercial strategy and push NZRC in a direction that will see it get closer to making the sort of money the Silver Lake transaction was predicated on.
But he is clear, however, that he took the job precisely because of the challenges it would present.
Schooled at Auckland Grammar, Fenton loved but didn’t really play rugby, and so when he became a qualified lawyer at Simpson Grierson in the early 1990s, he jumped at the chance to work on the initial US$555m ($908m) Newscorp broadcast contract that enabled the game to turn professional in 1995, and also on the first Adidas sponsorship deal with the All Blacks in 1997.
For the past 25 years he has been working in Europe, mostly in London, largely for Accenture and Google, for whom he was the tech giant’s managing director of strategy and operations for the UK and Ireland.
In a truly rare moment of unity, Fenton’s appointment as head of NZRC was met with universal approval across the rugby fraternity.
Smart, educated, entrepreneurial, business-savvy and with real-world experience in the digital sector, he has precisely the sort of skillsets, knowledge and worldliness to grow New Zealand’s most iconic sporting brand in foreign markets.
Since arriving in Auckland to start work in January - he’s returned with his wife and youngest son, who is taking a gap year in Wellington while his oldest son finishes a degree in Nottingham - he’s already made a favourable impression on those who have encountered him.
And he’s also had a significant influence on reshaping the future of NZR+, by repositioning it as just one platform through which New Zealand rugby content is going to be promoted.
Fenton, perhaps because of the high audience numbers NZR+ content achieved at the World Cup when it was played on YouTube, is not fixated with collecting registrations and running everything solely on the in-house platform.
He’s channel agnostic - not convinced that NZR+ needs to be the weight-bearing pillar in the content strategy, but simply yet one more avenue through which viewership figures can be collected.
“NZR+ is fundamentally about fan engagement, both at home and abroad,” he says.
“And in that sense it is a content play. Yes, we have a player that we have built, but this is about pushing content out over multiple platforms for broadcast all the way through to TikTok, YouTube and reels on Meta. And why is that?
“Because we need to meet the fan where they are and not have the hubris to expect them to watch only where we would like them to watch.
“I would expect for the foreseeable future that most of that consumption will occur on YouTube and on a shorter slice form on TikTok.”
It’s not clear if this is a distinct change in philosophy or not, but sources within NZR felt that NZR+ launched with plans to focus mostly on using big-budget productions such as the initial In Their Own Words project to try to ultimately win five million registrations.
That view deepened with the RFP that was sent out at the end of last year and the revelation that NZR+ would be backed with an initial total investment of $10m.
But Fenton is backing the creation of a more diverse and nuanced portfolio.
He says there is still room in the market for the docuseries genre championed by Drive to Survive and picked up by tennis through Break Point, but that 2024 will also see NZR+ produce and aggregate the full spectrum of content.
“In an attention economy you need to be unique and standout,” he says.
“In terms of the format, yet another ‘here is a story behind the story’ is not necessarily going to be unique and differentiated. But if I burrow a bit deeper and unpack that, what do these formats do?
“They go a little bit deeper into the personalities behind the numbers on the field. They bring humanity.
“We are moved as humans by human stories. The challenge as I see it is to provide access to that humanity under the surface but to do it in a way that is unique.
“You can expect a little bit of that highly produced, BBC-like production but the secret to getting to a sustainable place with content is to play across content types and there is a huge spectrum ranging from the original creator working from their smartphone filming selfie-style in their own bedroom which costs nothing, all the way through to that BBC character.
“What you would expect from us is to play across that spectrum. You don’t need to spend bucketloads of Netflix-type money to tell a story that is engaging and that is why YouTube has 2.8 billion monthly active users.”
If rescoping the strategic direction of NZR+ was Fenton’s first priority, the second has been to try to reset the relationship with the All Blacks.
A culture of distrust developed between the team - coaches and players - and NZR throughout the past World Cup cycle.
The players lost faith in NZR after it tried to push through the first deal with Silver Lake without adequate consultation, and there was unhappiness about the way coach Ian Foster was treated.
Without a basis of trust and with limited understanding of what NZR was trying to achieve with its streaming platform, the All Blacks didn’t provide NZR+ with the sort of access it wanted in World Cup year.
Some of that was also due to the natural protectiveness that coaches build around intellectual property and fearing what level of distraction may be caused by having cameras inside the camp.
But the arrival of Fenton has coincided with the arrival of a new All Blacks coach in Scott Robertson and a mostly new management team, and the former feels there has been a reset in the relationship.
“I think it is a journey,” says Fenton in building trust and confidence between NZR+ and the All Blacks.
“And it is a journey that I feel is heading in a good direction.
“Razor [Robertson] is very progressive. He is extremely enlightened. I have spoken to many of the key leaders within the All Blacks and some of them are creators themselves.
“But let me be clear, there is no decision that we will ever take in this space that will interfere or get in the way or compromise performance. That is sacrosanct.
“We will be guided by Razor. There is a big difference between exposing tactics and game play and some of the strategic thinking that goes into match-winning, versus the broader values that the team stands for: humility and excellence, keeping your feet on the ground, the so-called sweeping the sheds, the sense of stewardship that you are borrowing the jersey, which I think is a universal aspirational value.
“I think it can coexist quite happily and be a really constructive two-way thing and it is a great way of engaging fandom.”
In selling the Silver Lake transaction to its member unions, NZR said it would set up seven new business initiatives, one of which would be NZR+ and that it forecast it would make accumulated profits of $20.4m from this platform across its first four years.
That forecast suggested NZR was initially intending to monetise NZR+, either as a content subscription service or try to collect ad revenue from it - or possibly both.
But Fenton says there are no immediate plans to build a paywall, and for the foreseeable future, NZR+ will focus on driving indirect value, through generating greater awareness, engagement and interaction with teams in black that he hopes will ultimately drive up the value of sponsorships and broadcast contracts.
“If we can understand our fan base better, we can make decisions that are better suited to them,” he says.
“But also, as we work with partners who align with us because they stand for the same things as us, they want to know if they are with us, who are they going to reach?
“That is an important element ultimately for what they are going to be prepared to pay for that association.
“It is helpful to be able to say you are going to reach x people, this is how old they are, this is the gender mix, these are the countries they are from.
“If we are fan-obsessed it is going to create a building block that helps expand and grow the revenue sides of things.
“Sponsors will pay and there will be upward pressure on broadcast fees and more fans will buy more tickets to more games and more hoodies and that is essentially how NZR operates as a business.
“The hypothesis is that the bigger the audience and the more information we can provide, that will create value that people will pay more for.”
And the hypothesis will soon be tested as negotiations will begin in a few months to renew the current broadcast agreement which expires at the end of 2025.
Fenton will be the key figure for NZR, leading the negotiations and determining the overall strategy in a marketplace - both domestic and international - that looks vastly different to when the last deal was agreed in late October 2019.
Back then, NZR leveraged Spark Sport’s growing presence to extract a $100m-a-year agreement from Sky Sport.
There was competition in the domestic market and NZR used it to gain what was a 30 per cent uplift in fees.
But Spark Sport has collapsed, digital rights have soared and globally, some of the major streaming platforms are sniffing around live sport, Amazon having bought rugby content in the UK.
There is also potential for Sanzaar and the Six Nations to work collectively and bundle all their content to sell as a package to entice the likes of Amazon, Netflix or Disney to sign a huge cheque.
There are several other moving parts in all this, which is that the Sanzaar partners - New Zealand, Australia, South Africa and Argentina - have to agree a post-2025 format for the Rugby Championship, while Super Rugby Pacific also needs clarity about what it will look like, especially as the Rebels are effectively insolvent and about to collapse.
With so many unknowns and possibilities, Fenton has his focus primarily on the things he can directly control and influence.
He says it’s unlikely NZR+ will broadcast games live, certainly not in New Zealand.
It may look to service so-called dark markets where there is no broadcast agreement to show All Blacks tests, but it won’t put itself in competition with established, specialist broadcasters.
Clarifying that NZR+ does not have the ambition to be a live broadcaster is partly about reinforcing a message to Sky that it is highly valued, and that Fenton recognises its importance.
Although NZR and Sky have been in partnership since 1996, the relationship soured in 2020 - the latter felt it had been gouged while it was vulnerable to Spark and the former then felt the broadcaster used the arrival of Covid to claw back money - and its apparent Fenton wants to rebuild a bridge.
He says: “Sky is our most important commercial partner and I have an excellent relationship with Sophie Moloney [Sky CEO].
“We talk frequently about what we are doing and we share interests with each other and I think New Zealand is well served to have Sky.
“Our partner here is Sky and that is my priority right now - honouring that relationship and having that discussion first.”
But he acknowledges maximising the value of international content rights is vital, and rugby has an opportunity to sell itself to the world if it can secure a global deal with a major streaming platform.
And despite the financial strain some of these big players are feeling, the abundance of sports codes competing for dollars and the problems rugby has had selling itself to a mass audience due to its convoluted rules and inconsistent entertainment value, Fenton believes the sport is one that TV execs want on their screens.
“There is certainly interest and it is a simple equation – if you are in a marketplace you need to be easy to buy, clear and there are obviously options for bundling different modules in different ways.
“There is headroom available to produce a product and package that is better for international consumption.
“Although new in the job I have been in Europe for a long time and I am plugged into the key players on this and we are getting interest. “Our focus as a code as a collective of unions is to make the product compelling and easy to buy.
“From a media perspective, it is fairly simple: if you are a buyer of something you need to know what you are buying, so clarity is important.”
Gregor Paul is one of New Zealand’s most respected rugby writers and columnists. He has won multiple awards for journalism and has written several books about sport.
