With NRL ratings on Channel Nine dropping 16 per cent this year and fears the free-to-air TV industry won't be a competitive bidder when the broadcast rights expire in 2022, the game may be at the mercy of only one bidder, pay TV, unless it copies the AFL and cricket and invests in its own supply service. A leading News Corporation journalist has contacted Sydney clubs promoting the candidature of Racing NSW chief executive Peter V'landys as an ARLC representative of NSW-based clubs. Because V'landys has strong ties with News Corporation via investment in form guides, some administrators fear he could be sympathetic to a proposal to abort the planned investment in OTT technology. After all, Bulldogs boss Ray Dib has also been lobbying clubs to support V'landys. Cancelling the NRL's OTT plans would deliver $150 million to clubs and the future of the game to Fox Sports.

V'landys was once a candidate for the position as chief executive of the NRL and has strong business credentials, having led the campaign for bookmakers and Betfair to pay a fee for the use of racing's product as a betting medium. The case was eventually won in the High Court and delivered hundreds of millions of dollars in revenue for both racing and sport, including the NRL. He insists he has not been using the media to promote his candidature for an ARLC role. "I have not sought the position," he says. "A number of clubs approached me to determine my interest in the role." In response to claims he would be a News Corporation puppet, V'landys says: "I'm 100 per cent baggage-free and a puppet to no one. As someone who has played and followed the game my loyalty is to the game, the fans, the clubs and to the players. I've made it no secret that my objective is to maximise returns to the clubs and to the players." Asked his view of OTT as an alternative to pay TV, he offered an equivocal response: "This question can only be answered when analysing the financial models of both cases. A substantive financial sensitivity analysis would be required to have the necessary information to answer the question. There would need a good business case that can be substantiated. Any investment must not only have minimal risk and a commercial return on the moneys invested, but it must [also be] both user-friendly and cost-effective to fans."

Colin Smith, one of Australia's leading sports media-rights strategists, endorses this view, pointing out that no definitive business case has been done to determine the merits of direct delivery of games to fans. He suggests the NRL would need 2.5 million subscribers merely to break even and many more to deliver the $1.2 billion over five years currently paid by Fox Sports. "The OTT model will be in Australia in 2022 and by then, the consumer will be agnostic to the platform [on which his or her] sport is delivered, be it FTA, pay TV or OTT," Smith predicts. The AFL is well advanced with OTT plans, employing 150 staff, while the NRL's investment is nascent, basically providing digital content for a service for which they once paid Telstra. Perhaps the NRL merely has to flag its OTT plans to gain a seat at the negotiating table for the broadcast rights post-2022.

After all, it could form a joint venture with Telstra, or even with Channel Nine/Fairfax's Stan, to ensure Fox Sports is not the sole bidder. But with the upheaval over a new ARLC and NRL clubs seeking a share of the $150 million set aside for digital, the argument for a business case has been ignored. As Smith says, "The debate is political, when it should be financial".