Team New Zealand's defence of the America's Cup will be broadcast by TVNZ.

Team New Zealand have gotten an unexpected bonus from a heated bidding war for the free-to-air TV rights to broadcast the 2021 America's Cup in Auckland.

TVNZ saw off TV3 owners MediaWorks to win the rights but appear to have paid an over-the-top amount that could be close to $3 million for the honour.

Stuff understands there is also a strong element of Team New Zealand's sponsors being given on-air time under contra arrangements in the successful bid.

It is believed TV3 forced the state broadcaster to significantly increase their initial offer as they aggressively pursued the rights.

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The deal was brokered by a British company on behalf of Team New Zealand.

While TVNZ have the exclusive TV rights, it is understood fans will be able to access live racing via an America's Cup app.

As part of TVNZ's agreement, NZME's Newstalk ZB and Radio Sport will deliver exclusive radio commentary of the event.

The extra money from the bidding war is a bonus for Emirates Team New Zealand and will help with the design and build costs of their first AC75 foiling monohull which is now under way.

The development solidifies the desire of Team New Zealand to broaden the reach of the America's Cup after Sky TV won the rights to the last regatta in Bermuda where the Kiwis sensationally beat Oracle Team USA to win back the Auld Mug.

Emirates Team New Zealand head Grant Dalton said the idea that you couldn't watch it unless you pay for it did not sit right with the defender.

"It's been one of our cornerstones since we won the Cup," Dalton told Newstalk ZB of the free-to-air broadcast deal.

Dalton said the philosophy was to get the product out to as many people as possible and being available on a free-to-air digital platform was key to that.

"We want it to be available anywhere anytime," he said.

"I think we're suffering a little bit that over recent Cups it hasn't been all over the world like Kiwis would have been led to believe because it's been pay to air and often doesn't go anywhere."

TVNZ chief executive Kevin Kendrick hailed the return of the event to free-to-air TV and assured sports fans that the broadcaster wouldn't break to ads during live racing.

"The event returning to TVNZ brings to mind Peter Montgomery's iconic TV commentary – 'The America's Cup is now New Zealand's Cup' – because it brings the whole country together and as a nation we're really invested in the team's success," he said.

"We're going to push the boat out to make our coverage accessible to the biggest audiences so everyone feels part of the action."

The broadcast deal covers:

America's Cup World Series 2019

America's Cup World Series 2020

America's Cup Christmas Race 2020: Auckland

Prada Cup - Challenger Selection Series 2021: Auckland

36th America's Cup Match Presented by Prada 2021: Auckland