Melbourne’s Sport 927 is facing challenges on two fronts this week as rival broadcast groups vie for Sydney thoroughbred broadcast rights and SEN begins its new format (see other story), but station boss Noel Crowe is confident his station still has the upper hand as it gallops into 2004.
“We were thinking of buying 3AK when it was for auction,” Crowe revealed to radioinfo.
“We would have kept thoroughbred racing coverage on 927 and put harness and greyhound racing on 1116. We looked at the business model – because there is so much racing we thought could have used both frequencies, but in the end we could not see how we would have filled the extra air time with something that listeners would have wanted to listen to.”
Crowe thinks SEN will be doing it hard without the ability to broadcast live sport. “My question is how can they do it successfully without live broadcast rights? What will they be talking about at 2 o’clock on a Wednesday afternoon after all the weekend sport is talked out and the next weekend is not here yet?”
There are 400 sport stations in the United States, but Crowe says most are only marginally profitable and many take networked programs from providers such as ESPN and is skeptical that SEN will do much better. “There is such a big population in The States and they all love sport – 12,000 people will go to a college game in a blizzard! Even then not all those 400 stations are making money.”
ABC774 own the cricket broadcast rights; ABC774, 3AW and Triple M have the AFL rights sewn up; and other rights to secondary popular sports such as soccer and rugby league are also held by various broadcasters, so SEN has been left to talk about sport rather than cover it.
While the current racing broadcast negotiations could result in Sydney thoroughbred race calls becoming available, most other sport broadcast contracts are locked up for at least the next 12 months. If SEN is interested in live broadcasts it would have to pursue them as a long term strategy, rather than using them in the station’s first year.
Crowe recalls the days when 3AK, then owned by Kerry Packer, mounted its own cricket radio coverage. “10 years ago 3AK and 3LO both had cricket broadcasts. In the end people still listened to the ABC and the 3AK coverage cost so much that they dropped it… The ABC, 3AW and even Triple M do that kind of coverage well and we cover races completely, so I don’t see there is any place for SEN to go.”
SEN had approached 16 of Crowe’s staff before announcing the final lineup this week. “They called six staff late on Christmas Eve to talk to them – the staff generally thought that showed a lack of respect,” says Crowe.
While Crowe will be watching moves at SEN closely, he is confident that Sport 927 will retain the lion’s share of its revenue base and its loyal niche racing audience. “This is a huge industry. There are 300,000 regular punters in Victoria, half a million people come to the Spring Carnival, and wagering is a $15 billion industry nationally, so we have a viable business basis.”
Crowe is not so sure of the viability of the SEN business model, which is based on the continued operation of licencee DCL. “Why would any investor tip more money into a station owned by DCL. They have only two assets; their shareholders have lost a lot of money in the past few years; and they have a multi million dollar debt which they have to pay off. What happens if the upcoming rights issue is not fully subscribed and the bank forecloses on them – will there even be a station for SEN to broadcast on?”
DCL this week confirmed its arrangement with SEN for a three year lease of the licence with another three year option beyond that. The lease arrangement will see SEN pay $950,000 in the first year; $1 million in year two and $1.5 million in the third year of the lease. SEN will also pay a 2.5% share of all rveneue over $5 million to DCL. SEN and DCL will share the broadcast facilities of DCL’s current broadcast premises.
On the question of the racing broadcast rights being aggressively contested by several new players Crowe is pleased with the process, but sees problems for Sport 927 if the radio broadcast rights were lost.
“It is good news for racing because it will weaken the Sky monopoly stranglehold. Victorian and NSW racing will end up having more say, which can only be good… but if 2KY were unable to supply Sydney Thoroughbred race coverage to Sport 927, it would be a breach of their agreement with us and we would be severely compromised.”
Radio is a more important medium for the promotion of racing than TV according to Crowe, who does not think the manoeuvers taking place at present will end up causing any long term problems for Sport 927.
He recently snapped up former Test cricketer and St Kilda footballer Simon O’Donnell to join a three-man breakfast team which will replace Kevin Bartlett. O’Donnell, who turned down a rival offer from SEN, will begin at Sport 927 on January 23. The others on the show will be Michael Christian and Anthony Mithen.