- The debate over whether South African rugby should stay in the Southern Hemisphere or look for other opportunities is a distinct double-edged sword.
- Jurie Roux, SA Rugby’s chief, says from a simple income versus expenses perspective, it still pays to play in Super Rugby and the Rugby Championship owing to substantial broadcasting deals in place.
- Yet the rugby debate is a different beast: What if SA can gain more potential future value out of another venture as well as stronger teams?
One of the ironies about the raging debate over South Africa’s future within the Sanzaar alliance is that it still makes sense from a financial perspective.
A meticulous and pragmatic person like Jurie Roux, SA Rugby’s chief, won’t provide a false impression about that.
“The broadcasting revenues that we get out of a Sanzaar competition and, more specifically, out of internationals like the Rugby Championship is significant to the contributions of the revenue streams of South African rugby,” he said.
Indeed, at the conclusion of its annual general meeting last month, the federation announced overall revenue of R1.29 billion, a 2.5% increase driven predominantly by broadcasting and sponsorship.
So “highly rated” is the product still considered from a television production perspective, that if one crudely weighed up basic income against expenditure, continuing with the current arrangement would be close to a no-brainer.
“If you pit those revenues against the expenses of participating in the tournament, they would carry enough value commercially to just carry on irrespective of anything else,” said Roux.
“The difference is still massive in terms of what it will cost you and what the revenue is. It’s the main reason also why we can cross-subsidise other expenses within SA Rugby. If the criteria is straight what is revenue and what is expense, then you absolutely continue.”
However, the debate over South Africa’s continued stay in the Southern Hemisphere has long transcended the question over whether it just makes commercial sense.
Just ask a discerning local rugby fan whether he or she really still thinks Super Rugby is attractive to watch and you’d invariably receive a negative response.
If Super Rugby can’t keep the local pipeline strong enough – particularly given the continuous exodus to Europe and Japan – then a possibly overvalued broadcasting agreement won’t make much sense if South Africa can gain more potential future value out of another venture through stronger teams.
“As is the case with life in general, there’s a bigger set of criteria that we need to think about,” said Roux.
“Our internal criteria – and this is by no means exhaustive – is: What does it do in terms of the quality of our rugby? What does it do in terms of the performances we deliver across the rest of the world because we play in specific competitions? Is it commercially viable and a quality product that the fan base wants to consume? And, lastly, does it make us money?”
The 49-year-old candidly admits the media and other stakeholders can draw their own conclusions from that, though it emphasises the importance of Rassie Erasmus, the national director of rugby.
“Whether Super Rugby still makes commercial sense from a broadcasting perspective if you consult unions, absolutely. But we have to look at it as a whole. In my opinion, it serves a purpose. I believe we’re strong because we play New Zealand, Australia and Argentina,” said Roux.
“But when it comes to that element, I knock on the door and ask Rassie. If I start giving opinions on the strength of our rugby, we’ll be in deep trouble and never win a World Cup again. I stick to the admin side.”
