There are more questions than answers when it comes to deciding who will become the NRL's 18th team
Previously, in our series on NRL expansion:
BNE2.2: The Gemba Report (2021)
The Australian Rugby League Commission is open to expressions of interest for the National Rugby League’s 18th team. The new team will join the league in 2027 or 2028 as a sweetener for the next broadcast deal with Nine and Fox. The 18th team will add a ninth game each weekend, increasing the number of regular season games from the current 204 to 216. The ARLC is expected to make a decision on the new licence some time in the next year.
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The extremely online NRL crank - me - loves nothing more than expansion chat. Expansion is a novelty and has degrees of freedom that the ordinary, hum drum, day-to-day existence of a fan does not. There’s no problem that can’t be solved with more teams in different places.
These same cranks love to put pins in maps. Ask any European expansionist where Super League teams should be and you’ll get a list of western Europe’s major cities back. Ask their southern hemisphere equivalents and they would love to see teams in Perth, in Adelaide and a second team in New Zealand.
Expansionism follows a certain logic. These teams would open new markets to new fans and take the game to new places. New developmental pathways would be created. For a certain kind of practical crank, over the long term, expansion would increase revenue. Rugby league would finally become the globe-spanning colossus of homogenised human culture in the 21st century, like soccer and the Olympics, that it was destined to be.
Fundamentally, any sports team needs three things. The first is people to run and play for the team. The second is people to come and see the team play. The third is the money to glue the first two parts together. This kind of expansion requires short term investment - and if history is any guide, a lot of short term investment - in exchange for a longer and more resilient life for the sport we care about.
As of the time of writing, the concept of having teams in Perth or in Adelaide or New Zealand’s second team falls down at the first hurdle. There is no one who has declared a public interest in actually doing the hard work of running notional football clubs in these markets.
We can talk about how there should be a team in Perth but unless someone is actually willing to do it, there is no team. Maybe over the next months western candidates will emerge. Perhaps the state government will put together a task force to get a NRL licence. Perhaps the West Coast Pirates will form a community bid. Perhaps Andrew Forrest will see the light and realise his Global Rapid Rugby concept and the Western Force would be better served by dropping two men from the starting side, learning to cope with limited possession and working on their cardio. Perhaps Peter Cumins will announce a bid ten minutes after this hits in your inbox, or perhaps that will be next week, or perhaps never but for right now, it does not exist.
Even if a bid emerges, the current ARLC administration has made it clear that it has no love for the West beyond them paying for the right to host Origin every other year. Lickspittles Pete Badel and Buzz Rothfield both criticised the crowds on the opening day of the Perth 9s in 2020 (it was a Friday and 40 degrees) in a strikingly coordinated way1. Paul Kent, a huge dumbass that is currently facing domestic violence charges, claimed that “Perth, after the financial failure of last week’s Nines, does not seem viable”. V’Landys came to power in 2019 and famously admonished the NRL for wasting money in “rusted-on AFL states.” The 9s were cancelled during the pandemic, quietly put out of its misery, and eventually replaced with the Pre-Season Challenge™, an event that is much less fun, barely of interest to hardcore fans, let alone new ones, but has the notable advantage of being much cheaper to run. There is nothing Peter V’Landys loves more than being cheap.
It’s not clear if the administration sees the additional time slot, the significant increase in footprint and the untapped market as benefits that outweigh the additional travel costs and time - an argument that admittedly falls short if the plan is to ship players around the South Pacific instead - and the prolonged and undoubtedly expensive battle to win over enough of an AFL dominated city that a Perth NRL team wouldn’t be a millstone around the neck of the league2.
If the NRL thinks that, it’s likely because the broadcasters don’t see enough value in those benefits. The NRL or the bid or both would then need to cover any shortfalls. The Storm cost $100 million over their first decade and if you’re not serious about committing that level of funding over that timeframe, you’re not serious. Any natively western bid might then have to clear a higher bar than their counterparts from the eastern seaboard.
Theoretically, the NRL could get serious about going west with the hitherto unknown rivers of gold V’Landys and his team have uncovered (i.e. gutting the community and semi-professional level of the sport and re-directing funding to the professional tier) and do it themselves. If that’s the case, then we should hear about those benefits through the usual shills any minute now.
In the last round of expansion, the Dolphins didn’t make a lot of noise in the media. I suspect that’s because they knew they had the inside track from the beginning and that the bidding process was more or less a formality. They had history, they had a strong balance sheet and non-sporting assets, they had a stadium built with someone else’s money, they had a brand and they were tied to a Monopoly set of suburbs in the Brisbane metropolitan area.
That ticked the minimum requirements for the ARLC, and for Peter V’Landys, who I’m sure just wanted to be the guy that took action. The Dolphins weren’t the ideal bid - they weren’t “real” expansion or even wholly committed to Brisbane - but they were the best of what was available.
As the release of the Gemba Report implied, there was an internal political problem to resolve. In order for the Dolphins to become the 17th NRL team, the existing NRL teams had to approve it. There was no way that would happen if it meant taking a smaller slice of the same revenue pie. That meant the revenue pie had to be grown by at least the amount of the Dolphins’ prospective NRL grant, a sum that has increased from about $13 to about $15 million per year in during V’Landys’ reign.
Ultimately, Fox ponied up the required $15 million per year. The justification for the additional funding was not, as I thought at the time, that the Dolphins would sell more Kayo subscriptions in Brisbane, which seemed unlikely. Instead, Nine agreed to reduce the number of Broncos games they could put on free-to-air. Each NRL team is capped for the number of times they can appear on Nine in the regular season but the Broncos had a higher cap than the rest of the league due to being the biggest team in the sport by an order of magnitude. Nine agreed to this reduction as it could then use Dolphins games as a substitute for the Broncos games. Fox would then get more Broncos games to put behind the paywall, as well as 12 more games across the season, which in turn would sell enough Kayo subscriptions to previously marginal customers in south-east Queensland to justify the increased expenditure. If you wondered why Brisbane have had more Saturday games than usual, that’s why.
While we’re only half a season in, this strategy seems to have panned out well for all concerned. Peter V’Landys is the guy that made the new team happen. The NRL has a new driver to keep the lines on various charts moving up and to the right to let Andrew Abdo sleep at night. Fox got more Broncos games, just as the club put itself back together. Nine gets more ratings smashes, as the Dolphins’ debut and Conflict on Caxton demonstrated. Fans - insofar as anyone in a boardroom cares about those people - get a new Brisbane team if they didn’t like the old one, and fans of the old one get a new team to hate.
The problem is that trick won’t work a second time. There are no more Broncos games to paywall. The incumbent NRL clubs will not grant access to a new entrant if it means that their share of revenue is reduced. Naturally, with the broadcast deal up for re-negotiation and with an additional 12 games to sell, the NRL should be able to get more money from the game’s broadcasters from 2027 onwards. Whether they will get the $20 million or so to cover the new club’s grant and a little walking around money for themselves is a different but critical question.
The 18th team increases the NRL’s regular season inventory by 6%. The value of the current deal is extremely murky, being prone to mysterious extensions, whose conditions are obfuscated by the administration and subject to hyperbole by the alleged journalists whose job it is to inform the general public, while being unable to wrap their heads around the difference between nominal and real values.
The best I can estimate that the broadcast deals are worth about $380 to $400 million per year. While that seems like the kind of thing an annual report would clarify, all the 2022 report can tell us is that the NRL made a total of $593 million in revenue, of which $409 million comes from “licencing” and $168 million comes from “operations and events”.
On the back of the envelope, and all things being equal, the NRL needs to extract 5% more on its TV deals, which is not just the regular season inventory but also includes high value properties like the finals and Origin, to cover the cost of the new team. The NRL also needs to extract more money to cover for inflation eating away at its balance sheet. The NRL also needs to extract more money to account for increasing salary demands from the people who actually create the product the NRL sells, especially those who play in the NRLW. The NRL also needs to extract more money because we live in a capitalist society that demands ever increasing growth, because the alternative is irrelevance and death.
It’s not clear what the ARLC hopes to gain qualitatively with the 18th team but it seems obvious that it would want the new team to help resolve some of these financial concerns as part of the next deal3. The nature of the succesful bid will go a long way to determining if the NRL will be successful.
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Option A: Pasifika
Someone loves the Pasifika idea. I’m not sure who but someone powerful, either at the ARLC or in the Australian government or both, really loves the idea of a Pasifika team in the NRL. The NRL does not get to be the focus of a foreign affairs column in the Australian Financial Review otherwise.
I’m not convinced that those powerful people actually understand what “Pasifika” means.
Pasifika peoples call Aotearoa home, but continue to have family and cultural connections to Pacific Island nations – the islands and cultures of Samoa, Tonga, Cook Islands, Fiji, Niue, Tokelau, Tuvalu and other Pasifika heritages.
The terms “Pacific” or “Pacific peoples” are umbrella terms that are used to categorise islands in the Pacific Ocean. These terms are used in reference to the islands of Melanesia, Micronesia, and Polynesia in particular. “Pacific peoples” may be recent migrants, long settled in New Zealand, or New Zealand-born.
Pasifika and Pacific peoples also often have multi-ethnic heritages, and identities that transcend ethnicity.
Presumably, the ARLC and others mean to extend the definition above to similar people in Australia, even though we do not have precisely this cultural concept but it does have some parallels with the Australian South Sea Islander identity. Pasifika could theoretically include people from Papua New Guinea but Papua New Guinea’s place in Pasifika is up for debate.
If the plan then was to base a team in Cairns, paint it in Pasifika and then try to tap into Papua New Guinea and the rest of the South Pacific as a cheap play to keep China at arm’s length4, I see some issues. I’m already embarrassed and terrified at the yawning chasm of my own ignorance - did you know that the banana was (probably) domesticated in Papua New Guinea? - and I’m not convinced that the ARLC or the Department of Foreign Affairs and Trade has done much better. Papua New Guinea’s relationship with China, Australia and the rest of the Pacific is not going to be resolved by a football team.
There are nearly 9 million Papua New Guineas and they speak 850 languages, a cultural diversity unmatched by anywhere on Earth, with a GDP per capita half that of Fiji and one-thirtieth that of Australia. Yes, rugby league is the national sport but if white people cannot govern a country with 246 varieties of cheese, I’m not sure we have a much better chance at appropriately engaging with the diversity of people on our doorstep, a thought more than borne out by Australia’s historic lack of success at doing just that.
The time for an actual Pasifika team was 2017, following on from Tonga’s success in the World Cup, and it was definitely before union beat league to the punch in 2020 by having the exact same idea, except funding it from World Rugby’s coffers and basing the team in New Zealand, both of which make their enterprise much more sustainable. If rugby union is doing a better job of this, it might be time to go back to the drawing board.
If DFAT want to build better connections with our Pacific neighbours, it might be time to get out the chequebook to outspend and outbuild China while doing something serious about climate change, instead of using the Pacific Islands as pawns on behalf of the United States in their quest to maintain their status as the sole superpower.
Even if we deem all of that immaterial - which you shouldn’t but it nonetheless will be - there are commercial questions to be answered. How will the team be funded when DFAT inevitably loses interest in the project? How do the Cowboys feel about another team being placed in their own sparsely populated territory? If not there, then where? Are the broadcasters in any way interested in this idea? Has anyone considered the cost of broadcasting games from Apia, Nuku’alofa and Suva? Or the missed revenue playing in stadiums with a capacity of 15,000 and tickets paid for in Fijian dollars or Tala or Paʻanga?
Wouldn't it be as effective, but much cheaper and easier, to play internationals in these places, instead of handing over a lucrative NRL licence that can never be reclaimed?
Does the ARLC just want to use this as a ploy to get into proximity to power?
Those who love the Pasifika idea need to start finding answers to those questions.
Option B: Bears
No one needs a rehash of the Bears’ story because we’ve been hearing about it every six months since Manly took the Northern Eagles’ licence at the end of 2002 and decided their joint venture would be better with less North Sydney and more Manly-Warringah (at a ratio of all Sea Eagles to zero Bears, to be precise).
North Sydney claim a fanbase in excess of 200,000, based on a survey no one else has seen, a number that seems to grow each time it's quoted. This is amazing considering the number of fans that were supposedly permanently lost to the game by their demise. As of 5 May 2023, the Bears have 1,900 members.
Norths, for all their mythologising, have had some self-awareness. They quickly gave up on being the 17th team, recognising that the ARLC was intent on going to Brisbane and having had an approach for joint bid rejected by Redcliffe, accepted that relocation wasn’t going to be welcomed by the local market.
Since that decision was handed down, the Bears have been in the media agitating for a return to the league, even though there are people nearing 30 that wouldn’t remember Norths in first grade. Their conditions for a return are simple:
We want our colours, our brand and to play two games at North Sydney Oval a year. That will give us our history back. We will completely fund it. We will go wherever the NRL thinks is the best option. We will not cannibalise any other club. We will create extra pathways.
-Billy Moore, NRL expansion bombshell: 20-team competition could revive Bears, include Pasifika team, Code, 12 March 2023
The ARLC is then free to decide what the Bears should be. The rational rugby league fan looks at that and starts mocking up Perth Bears logos in their head and wondering if Citibank still exists in Australia. It would be the slammingest of slam dunks.
So why haven’t the Bears decided to take the plunge and announced a relocation to Perth if successful? One reason may be that the ARLC has made it clear to the Bears that the NRL isn’t going to Perth, so there’s no point in getting attached to the idea. Another reason might be that the Bears are trying to integrate themselves into the Pasifika bid, further disfiguring that milieu. A third reason might be that to make Perth work, they need funding and are negotiating with the Western Australian government (or possibly Jim Jeffries) for same and will make an announcement shortly.
But they might simply be that they holding out hope that they will be given the licence without any conditions attached. In that scenario, they can go back to North Sydney Oval, or possibly Central Coast Stadium now that it is finally constructed, and pick up exactly where they left off.
However, rather than just being aligned to one geographical location in an already congested Sydney league market, the pitch is to take some home games to regional NSW areas, such as Dubbo, Coffs Harbour, Wagga Wagga, the Central Coast, Tamworth or wherever else the NRL sees fit.
However, there would be scope to play between four and six matches at the club’s spiritual home of North Sydney Oval, providing a connection to the club’s heritage.
-Bears reveal bold bid to come out of hibernation as NRL’s 18th team, Sydney Morning Herald, 27 October 2021
Unlike in 1999 or 2002, NRL licences will soon be perpetual. To borrow the words of our illustrious chairman,
We are going to introduce perpetual licenses which run forever. The law says we have to put a figure on it so it will be 99 years for argument’s sake… From here on the clubs won't have to sign a new agreement every 10 years.5
-Peter V’Landys, Peter V’landys wants to guarantee NRL club’s futures for a century, Zero Tackle, 4 December 2022
Let’s lay out a scenario. The ARLC wants a NRL team in Perth (substitute various island nations or regional NSW towns if that's your preference). They give a licence to the Bears. The Bears play nine games in Perth and three at North Sydney Oval. The team doesn’t do so well on the field in the first few years and struggles to attract top line talent. Meanwhile, the Eagles win an AFL premiership (or the Bears realise drawing 6,000 fans in Lautoka or Tamworth is not that lucrative). Interest in the Bears wanes and so do the crowds and ratings. The Bears want to come home.
In that scenario, do the ARLC and NRL have the leverage to keep the Bears in Perth? Can they put conditions in the licence that keep the team in Perth, or at least in a split with Adelaide? Would a later administration agree to change the terms of the licence if the Bears asked nicely enough or with enough lawyers? What does moving the team actually look like?
Certainly, taking existing rugby league infrastructure to Perth saves a lot of time and effort compared to establishing a brand new entity from scratch. With multiple home games played in Sydney each year, something neither the Brisbane Lions nor the Sydney Swans do, the Bears will never really commit to Western Australia. They probably won’t even adopt a geographical marker in their name. That leaves the door open, either for them to walk out or to be pushed out.
Then what? We’re back in the late 1990s. The Bears need to find a home because Sydney doesn’t have room for them anymore. When they find that home, perhaps by roaming around the countryside to whatever provincial backwater will take them in for a home game or two, will they be able to generate enough revenue to cover their existence?
More importantly, if professional rugby league leaves Perth for a second time, it’s never coming back and you may as well learn what an inside-50 is.
Option C: Tigers
The Tigers seemed to have learned some lessons from the previous bidding process. It was not just a dick swinging contest over who could get the Courier Mail to print the biggest dollar figure in a headline. Fox was going to be able to play their three-card monte with Nine, irrespective of whether the Dolphins, Firehawks or Jets were given the nod. The appeal had to be to what V’Landys and the ARLC said they cared about: suburban tribalism.
The Firehawks didn’t quite fit that mould. It was a new brand, not an old one. While the Dolphins had famously sued the Titans to keep their name, the Firehawks logo looked and name sounded a lot like the Queensland Firebirds netball team, which was not an auspicious start.
Eastern Suburbs pivoting to be a whole of Brisbane team made sense, in that there should be two teams in Australia’s third largest city, one in the sixth and one in the ninth. Instead, we got one team in Australia’s third largest city, one in the sixth and one sort of half committed to both the third and the ninth and also Central Queensland. That the contiguous bit of geography from Dohles Rocks Road to Ogmore doesn’t have an actual name that the team could have adopted speaks to a kind of half-in-half-out commitment that has seen the Wests Tigers pilloried over the years, but the forethought to “take over” this area must have had some appeal to the ARLC.
Or at least, it was better than the Tigers belatedly discovering the goalposts had been shifted in a meeting they weren’t invited to, and realising they needed to get with someone more down to earth than the whole city of Brisbane, but only finding the Jets left on the dancefloor.
The Tigers aren’t going to make that mistake twice. They already had a similar level infrastructure to the Dolphins. It’s telling that they used the re-opening of their refurbished home ground6 and the presence of Des Morris to trumpet their expression of interest to the media. The press conference screamed, “The Tigers are here, in Coorparoo, with this new suburban stadium and we have this history. Look at this old man who used to captain-coach us. We’re naming a stand after him!”
The Tigers have yet to commit to a new brand, other than reconfirming that they will not be the other Tigers should they be given a NRL licence. They are laying groundwork for their position in the market by casting the Broncos and Dolphins as “northern” Brisbane teams, an idea that is laughable when you consider where the Broncos’ fans actually live and that the postcode of head office is irrelevant to all but the cranks, but it will probably work as a gambit on a long enough timeline with enough marketing dollars spent on it.
That sets the Tigers up to be the “southern” Brisbane team, taking in the Logan and Ipswich suburbs along the axis of the M2 and M6. Even though Coorparoo is on the other side of the M3, safely ensconced in the Brisbane City Council area, it is at least south of the river. They have history, they have a strong balance sheet, they have a stadium, they have a brand (but one that needs work), and they are tying themselves to a specific Monopoly set of suburbs in the Brisbane metropolitan area, even if that’s geographically and socially removed from where they originate.
The Tigers’ problem are that they are simply too late. We’ve already done this and while it’s been a success so far, we’re only halfway through a season and the Dolphins were extremely lucky to for it not fall in a heap. As stupid as it sounds, if the NRL really loves the Pasifika element or the Bears wake up to themselves, then the lack of novelty hurts the Tigers. We already have this team and they’re called the Dolphins.
Their tardiness also means that Fox no longer has any incentive to specifically encourage a greater presence in south-east Queensland. There’s no more Broncos games to paywall and if the uncommitted fans in Brisbane have been swept up by the Dolphins bandwagon, how do the Tigers sell more Kayo subscriptions? Can they prove that their presence would lower subscriber churn perhaps, giving the average Brisbanite more teams to follow in the hope at least one will be good? Are the Tigers relying on some big clashes with the Dolphins and Broncos winning over Nine and pushing more Dolphins games behind the paywall? That hasn’t really worked for the Titans: both derbies against the Broncos are scheduled in sub-optimal pay TV slots this year.
There’s the question of whether south-east Queensland should even have a fourth team7. The common refrain is that “Sydney has too many teams” and is one I’ve echoed plenty of times before. Plenty of Sydneysiders have said it too, before going on at length why their team shouldn’t be sent to the knackers.
From a cultural perspective, having so many ARLC votes tied up in one city is problematic for everyone outside of that city, but of course, no one actually cares about that.
From a commercial perspective, that’s nine mouths to feed, each getting hungrier year-on-year as they compete with an ever increasing numbers of professional sports teams, both in the city and around the world, and now have to accommodate the women that have appeared within their ranks. Up until recently, there hasn’t been enough to go around, leading the likes of Buzz Rothfield to tally up the clubs’ losses for an annual crisis piece about how much money the game is losing. Those pieces have stopped because the clubs have stopped losing money because the NRL gives them more money. It’s so simple, you have to wonder why no one thought of it earlier. It seems then that are no longer too many teams in Sydney because they are no longer just surviving but are now comfortably existing.
Even so, by the time the 18th team enters the NRL, the population of Sydney and Queensland will be about 6 million each. If the Tigers (or another Queensland candidate) are successful, Queensland would have five teams to Sydney’s nine. Even though the infrastructure and culture around rugby league in Queensland is far more amenable to this kind of arrangement, even on a simple per capita basis, Queensland will still have half the problem of there being “too many” teams than Sydney.
Picking a winner
It is early days. As with the last round of expansion, there are pluses and minuses to each bid. The bids will respond to perceived issues from the media or the real issues I’ve highlighted here or fresh issues not yet considered and strengthen or weaken their positions accordingly.
There will probably even be other bids. Peter V’Landys was talking about “investigating” a second Melbourne team as recently as three weeks ago, even though precisely zero people want that. One hopes the West or Aotearoa wake up at some point or can at least convince the Bears to plant a flag.
As with the last round of expansion, the ARLC probably already knows what it wants and is working backwards to justify that conclusion - not that they really bothered with providing the justification to us plebeians. In the meantime, it’s a matter of piecing together what scant evidence we’re given to try to predict the course the ARLC wants to set for the NRL.
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Brad Walter at NRL.com apparently did not get the memo but then NRL.com was gutted not long after.
The irony of carrying nine barely functional Sydney teams as a matter of course is not lost on me.
The NRL will also likely get around this by setting up a $300 million fund to make investments on behalf the game, which definitely won’t be used as a slush fund to do commercial favours to powerful friends. The roadblock seems to be the players, who want that money for themselves, but unfortunately, negotiations are slow as the powerbrokers are more interested in selling the sport to America via bookmakers than negotiating terms with the people who are responsible for the existence of the sport.
But not too far away because we still need them to buy stuff, like university degrees and iron ore.
“But what if they decide to sell down the track? What if we find out a year later that the new owner is actually an international cocaine smuggler. What if he goes to jail? It's only that sort of scenario that might put a license at risk.” That might be the funniest thing he’s ever said.
Although it has a way to go to be on par with Dolphins Oval. For example, no one seems to know what the final capacity will be after stages 2 and 3 are complete. Langlands is currently 4,000 to the Dolphin’s 10,000.
I maintain that there should be a SEQ 4, but that should be in a 20 team NRL and a space for which would probably come about by a Sydney team relocating to a southern market or, preferably, going bust.