Instead of rebuilding stadiums, the NSW government should focus on local sport and events


Chris Gibson, University of Wollongong

The New South Wales government’s argument for spending A$2 billion rebuilding stadiums is that Sydney is losing flagship events to other state capitals, leading to fewer tourists and less media exposure. But large investments in transportation and venues are a significant drain on the public purse, often for economic returns that rarely break even.

Our research suggests that the NSW government should invest in smaller community events and sporting organisations that make use of existing facilities. We tracked 480 community events across Australia and found that they generated A$550 million in revenue.

These events also contribute more than A$10 billion a year to their local communities, support 100,000 jobs, and help build local business networks and skills.

Parkes Elvis Festival.
John Connell and Chris Gibson (2017) Outback Elvis: The story of a festival, its fans & a town called Parkes. Sydney: NewSouth Publishing

The benefits of grassroots events

In contrast to major, one-off events that require large infrastructure and marketing budgets, there are thousands of small community events across Australia every month. Each might only attract a few hundred people, but the revenue adds up.

Places that have consciously fostered grassroots community events, such as Ballarat and Hobart, enjoy healthy visitor numbers year-round, without overwhelming the local infrastructure.

Smaller community events make good use of existing facilities such as RSL clubs, showgrounds and parks. They tend to hire labour, PA systems, portaloos and catering from the local community, keeping dollars in circulation locally.

In contrast to mega-events that subcontract management to large firms, community events integrate more participation from their local communities. This not only improves local business networks, but also enhances local skills and leadership.

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The economics of large events doesn’t stack up

The evidence also overwhelmingly shows that public investment in major events isn’t worth it. Promised benefits are often exaggerated, and in the words of a recent review of the international research:

…any increased economic activity resulting from the event is routinely dwarfed by additional public budgetary commitments.


Read more: Suspended reality: the ins and outs of Rio’s Olympic bubble


Sydneysiders may have enjoyed the experience of hosting the 2000 Olympic Games, but increases in tourism and business investment failed to materialise. Rio de Janeiro is struggling with recession in the wake of its 2016 Summer Olympics. The money spent on the Olympics would probably have been better spent upgrading hospitals and other infrastructure.

This is partly why cities are backing away from hosting major sporting events. When the International Olympic Committee opened the bidding for the 2024 Summer Olympic Games, all but two cities – Paris and Los Angeles – withdrew their bids.

The fact that no other city was prepared to bid shows that the justifications for lucrative mega-events are wearing thin, both financially and politically.

Misleading numbers

The NSW government recently defended its plan to rebuild stadiums by arguing that the revenue generated by major sporting events will easily pay for itself within a few short years. Economists beg to differ.

Such estimates are typically based on conducting visitor surveys at events and asking punters to estimate their total spending. This is not good research methodology.

For one, people are consistently inaccurate at estimating their spending on the spot, only discovering the actual amount when they open their credit card statements.

It can also be hard for visitors to differentiate between money spent while at a specific event, and their spending elsewhere on their holiday.

Visitors complete surveys at the Daylesford ChillOut Festival.
Chris Gibson

We also need to subtract all of the money that would have been spent whether or not a major event takes place. This includes spending by people who live in the area, those who rescheduled travel plans to coincide with the event, and those who would have done some other activity (also known as “time-switching”) instead of going to the event.


Read more: Sydney’s stadiums debate shows sport might not be the political winner it once was


In other words, take all the Sydneysiders, casual visitors and time-switchers out of calculations of, say, weekly NRL game revenue at the Olympic or Sydney football stadia. The actual amount of “new” revenue for Sydney is much less impressive.

This is why a sober analysis of the true costs and benefits, and actual revenue numbers, are needed before governments rush to invest in major sports and event infrastructure.

The ConversationIf NSW truly wants to foster the events economy, the evidence suggests that money would be better spent on local community events and sporting organisations.

Chris Gibson, Director, UOW Global Challenges Program & Professor of Human Geography, University of Wollongong

This article was originally published on The Conversation. Read the original article.

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Chasing the audience: is it over and out for cricket on free to air TV?


Marc C-Scott, Victoria University

How Australians watch cricket on screens in the future could depend on what happens with the Nine Network’s current discussions with Cricket Australia over the 2018-23 media rights. The Conversation

UBS media analyst Eric Choi said the current deal costs Nine about A$100 million a year but generates only A$60 million to A$70 million in gross revenue.

Choi said the network should either ask for access to more content at no additional cost, or step away from its long association with cricket.

The ramifications of Nine’s decision could be broad, impacting not only its potential revenue and viewers, but also participation rates among Aussies playing grassroots cricket.

Cricket’s current standing

The current media rights deal for cricket includes the Nine Network and Network Ten. Nine has the rights to international tests, one-day internationals and T20 international games played in Australia, whereas Ten has the rights to the Big Bash League (BBL).

The BBL has become a crucial cricketing brand, continuing to gain high ratings and listed in Australia’s Top 20 engaging programs for 2016.

The league also has excellent crowd attendance, having recently ranked 9th in the world’s top-attended sports leagues.

Based on the BBL’s success and the increases seen in the new media rights for the Australian Football League (AFL) and National Rugby League (NRL), Cricket Australia will want to see an increase in the bidding for its rights.

This is particularly relevant if Cricket Australia still relies as heavily on these rights as in 2012, when it said the rights accounted for 60%-80% of the total annual income.

But can the media rights continue to increase with the current unstable media landscape?

The current media landscape

According to Arnhem Investment Management, the era of advertising-supported premium sport on Australian television is “drawing to a close”.

The free-to-air (FTA) broadcasters are also currently requesting that the government reduce license fees and reconsider plans to further restrict gambling ads during the broadcast of sports.

Ten has said it expects its revenue to be “above the 1.2% increase” it outlined in February this year. Yet it will still need to undertake a “significant focus” on a corporate cost-cutting program and profitability as a priority.

New stakeholders

With FTA broadcasters under financial pressures, any increase in new rights will require new stakeholders.

Foxtel currently shows international cricket matches played overseas, but does not have local coverage rights. If it could gain local cricket rights, this would further strengthen Foxtel’s sports offering of AFL, NRL, A-league, V8 Supercars, and many international sports.

Australia’s anti-siphoning regulation could prevent Foxtel completely dominating the cricket media rights. But this list is expected to be trimmed further by the government this year, furthering opening up the sports media battleground for pay television in future rights deals.

The future for digital rights

Digital rights will also be a major consideration with the new cricket media rights. While most would be looking at Telstra and Optus, there have been new players in this area who may also wish to place a bid.

Currently Cricket Australia has the Cricket Australia Live app which allows users to pay a subscription (A$30 per year or A$5.99 a day) to gain access to live streaming of games, but the new rights could also see this change.

Optus may continue its affiliation with cricket. It recently become the official mobile media partner of Cricket Australia, and principal sponsor of the Melbourne Stars Big Bash League team. Customers can access cricket content via the Optus Sports app, which also includes Optus’ recently acquired English Premier League.

Twitter has had success with broadcasting the US National Football League (NFL) and the Melbourne cup last year. This year it signed a two-year deal with the US National Lacrosse League. Twitter may consider its interest in a global sport like cricket.

Amazon, which recently launched its Prime Video service in Australia, could also be a contender. This year Amazon won the rights for NFL Thursday night matches. It paid US$50 million for ten games, five times the price paid by Twitter last year. Amazon may look at the cricket as another potential global sport to add to its catalogue.

Another consideration is if Nine or Ten were to obtain the digital rights and use the free and subscription approach that the Seven Network used as part of their Rio Games coverage last year.

The impact on the viewing experience

Can you “slice and dice” too much? This is a question being asked in the US by CBS chief executive Les Moonves with regard to the NFL.

Adding another stakeholder to cricket will impact the viewers’ experience. This year the new AFL media rights created some frustration linked with the way the rights had been negotiated, particularly the digital rights.

Telstra, the digital rights holder, is restricted by its agreement to limit live match videos to a 7-inch screen size. Highlights and replays are available in full-screen size 12 hours after the match ends. (Foxtel, meanwhile, can stream the games full-screen.)

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This change has outraged some fans who paid the A$89 subscription fee for the AFL Live app. Because of the screen size restrictions, Telstra users with a large phone or tablet have a large amount of black space on their screen.

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Some Australians are being creative in working around the restrictions.

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Media coverage and participation

The media rights for sport can be looked at far more broadly than solely the coverage of the game itself.

In the United Kingdom there has been ongoing debate associated with cricket’s coverage. Since the sport moved to pay-TV, there has been a decline in participation levels, which many argued is primarily due to the game no longer being broadcast free to air.

Reports of a Sport England Active People survey show a 32% drop in participation levels in people aged over 16 since coverage of cricket moved to satellite and cable TV.

There are now steps being taken to introduce a new Twenty20 tournament in the UK, built around the success of the Indian Premier League and Australia’s BBL, which had some games live broadcast in the UK during the last season.

This is an interesting case study for Cricket Australia, which only last year announced cricket as “No 1 as the current top participation sport in Australia”.

Any changes to the rights that impact the percentage of Australians with access to the coverage, could also see a decline in participation based on the UK experience.

Marc C-Scott, Lecturer in Screen Media, Victoria University

This article was originally published on The Conversation. Read the original article.

Australia Dedicates Cricket World Cup Win to Late Teammate


TIME

Australia captain Michael Clarke dedicated his team’s Cricket World Cup victory to the memory of teammate Phillip Hughes, who was killed during a match in November.

“I think for everybody in Australian cricket it’s been really tough few months,” Clarke said, according to the BBC. “Tonight is certainly dedicated to our little brother and our teammate Phillip Hughes.”

Hughes was struck in the head by a ball and was rushed to a hospital for emergency surgery. He remained a medically-induced coma for two days before his death. He was 25.

Australia defeated New Zealand by seven wickets in the World Cup final on Sunday. It was a record fifth World Cup victory for the Australians, and their fourth in the last five tournaments. No other country has won more than twice.

This article originally appeared on SI.com

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