Seven West Media could save more than $135 million if it successfully proves in Federal Court that Cricket Australia breached its Big Bash League broadcast rights contract.
The future of free-to-air cricket was turned upside down late last week when broadcast partner Seven sued in Federal Court to try to blow up the $450m deal, which expires in 2024 Seven claims CA breached its contract by lowering the quality and standards of the Big Bash League, which has struggled to generate high ratings since Seven acquired the rights in late 2018.
Media sources familiar with the court case, who spoke anonymously as the matter was before the court, said Seven would seek approximately $20 million in damages annually for alleged quality violations. BBL over the past three years. The network expects to save $75 million more against the end of the final year of the deal.
The broadcaster, which signed the deal with CA and Foxtel in 2019, also hopes to save around $20 million in production costs. A spokesperson for Seven declined to comment.
“Cricket Australia is working with our broadcast partners to ensure we deliver what will be another full and exciting summer of cricket,” a CA spokesperson said. “We talk daily with Seven and Fox Sports about programming and production. »
Successful legal action would put the broadcaster in a more competitive position to negotiate rights with other sports – such as tennis – and free up cash should a merger and acquisition opportunity arise. It could also allow Seven to reduce its debt load by several million dollars (pro forma net debt was $295 million in February). If the deal is terminated, CA would not receive Seven’s $75 million, but it may seek to strike another deal to ensure it has cash for the season.
“We talk daily with Seven and Fox Sports about programming and production. »
Australia Cricket Spokesperson
CA sources, who also declined to speak publicly for legal reasons, believe the $20 million per year figure is grossly inflated, given that Seven was only awarded $5.3 million by an arbitrator. independent last year for canceled matches caused by the COVID-19 pandemic.
Seven sued based on allegations that CA had damaged the quality of BBL since signing the rights deal. The claims are based on several factors, such as the scheduling of One Day Internationals and Twenty20 Internationals (both broadcast on Foxtel) conflicting with the BBL schedule, which would have affected the availability of players from high level and would harm its chances of maximizing audiences. , and imposing salary caps that have failed to attract the highest quality and best players in the world.