Peter Bills: Ofcom decision highlights financial precariousness of English rugby

If you take heed of the cries of anguish from sports bodies like the Rugby Football Union, last week's announcement by Ofcom, the communications regulator, that Sky Sports will have its wings clipped in a financial sense over TV rights, is a disaster.

The result of a 3-year enquiry by Ofcom into Sky's domination over sports rights in British television has concluded that it is charging others far too much for access. The regulatory body announced in a report that such a position of dominance of the market and the tariffs it sets for others to gain access is no longer tenable. Cuts of up to 23 per cent have been proposed.

Of course, this has rung alarm bells in places like Twickenham where negotiating vast TV fees with BSkyB for coverage of the English game has become an assumed right. Perish the thought that a nasty regulatory body like Ofcom, more interested in the consumers and what they are being forced to pay for such a service, might come along and wreck a very cosy, beneficial arrangement.

For the fact is, even in a country like England where the population has ballooned close to 65 million and where hundreds of thousands of young people play the sport, professional rugby still cannot pay its own way. Twickenham may wave balance sheets at critics like myself and say sneeringly "Look at us; we're creaming it."

They may be, but look at a club even as successful as London Wasps, past Heineken and Guinness Premiership champions and home to a multitude of international coaches – Ian McGeechan, Warren Gatland, Shaun Edwards – not to mention a host of big name international players. A booming business? Wasps are seeing crowds down by anything between 1,500 and 2,000 each time they play. Season ticket holders are quietly slipping away, content to buy tickets for the occasional game now rather than pay for every match.

Of course, some of this is to do with the world's worst recession for 80 years. But top class rugby's struggle to pay its own way and run as a successful business long pre-dates the recession.

What has masked the problems of all the English clubs, where losing anything between 1 and 2 million pounds a season is considered the norm, has been two factors; one, the wealthy individual benefactors who have become owners and lost tens of millions collectively over the years since 1995 when the game went professional and secondly, the TV money. Without that, the whole ship would have capsized years ago.

No wonder Francis Baron, Chief Executive of the RFU, rushed to the airwaves this week to denounce the Ofcom decision and warn of the consequences to several sports, rugby included. The game is petrified of seeing a reduction in the money BSkyB will pay to the RFU for TV rights. Twickenham knows that no-one else would pay anything like as much and a reduction in the fees would be catastrophic for Twickenham and the English clubs. Furthermore, Baron's contract to pay the money to the Premier clubs has 7 years to run.

The only trouble was, the man from Twickenham was economical in furnishing his listeners with certain other relevant facts. Of course, it hardly takes a genius to see that if BSkyB are unable to go on charging their rivals such inflated fees for access to their sports rights, that loss will be passed on to governing bodies like the RFU.

But what Baron did not mention, was the amount of wasted money at Twickenham itself and, by inference, the English clubs. Consider, for example, the sum of £100 million, the amount the RFU is giving the English clubs over an 8-year period to help shore up businesses which still cannot stand on their own economic feet, after 15 years of professionalism.

And where has the lion's share of that money gone? To pay for a glut of overseas players who have come into the English game, trousered vast salaries and denied places in the English Premiership club teams to countless numbers of aspiring young English players.

If Baron is sincere about his guardianship of the game's money, why did he not summon his lawyers last year when it became clear that the Premier owners had, allegedly, conspired to divert this £100 million, intended to guarantee the flow of young English talent into the England squad, into their own private clubs and pockets.

This flood tide of overseas players has significantly reduced the number of players available for the England team. Thus, the national side has suffered failure after failure since that famous World Cup triumph seven long years ago. Since then, England has won nothing and continues to look as though they're going to win nothing for another seven years.

Yet the thought of insisting most of that £100 million focuses on the English game, doesn't occur to Twickenham. It has been happy to sit back and see it disappear out of the game in the pockets of Samoans, Tongans, New Zealanders, South Africans, Australians, Argentinians and such like.

The wailing in anguish and gnashing of teeth from people like Baron is because they can see their own profit margins taking a hit because of the Ofcom decision. No wonder he revealed RFU lawyers are studying the judgement with a view to a legal challenge. But perhaps Twickenham would do better to study its own spending habits and make savings there.

For sure, there are plenty to be made.

News
Sir David Attenborough
people
Life and Style
Young girl and bowl of cereal
food + drink
News
Comic miserablist Larry David in 'Curb Your Enthusiasm'
peopleDirector of new documentary Misery Loves Comedy reveals how he got them to open up
Arts and Entertainment
Henry VIII played by Damien Lewis
tvReview: Scheming queens-in-waiting, tangled lines of succession and men of lowly birth rising to power – sound familiar?
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Sport
football
Arts and Entertainment
'The Archers' has an audience of about five million
radioA growing number of listeners are voicing their discontent; so loudly that even the BBC's director-general seems worried
News
i100
Arts and Entertainment
Ready to open the Baftas, rockers Kasabian are also ‘great film fans’
musicExclusive: Rockers promise an explosive opening to the evening
Life and Style
David Bowie by Duffy
fashion
Arts and Entertainment
Hell, yeah: members of the 369th Infantry arrive back in New York
booksWorld War Z author Max Brooks honours WW1's Harlem Hellfighters in new graphic novel
News
advertisingVideo: The company that brought you the 'Bud' 'Weis' 'Er' frogs and 'Wasssssup' ads, has something up its sleeve for Sunday's big match
Arts and Entertainment
tv
News
i100
Environment
Dame Vivienne Westwood speaking at a fracking protest outside Parliament on Monday (AP)
environment
Life and Style
tech
Caption competition
Caption competition
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Daily Quiz
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

Career Services

Day In a Page

Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee
World War Z author Max Brooks honours WW1's Harlem Hellfighters in new graphic novel

Max Brooks honours Harlem Hellfighters

The author talks about race, legacy and his Will Smith film option to Tim Walker
Why the league system no longer measures up

League system no longer measures up

Jon Coles, former head of standards at the Department of Education, used to be in charge of school performance rankings. He explains how he would reform the system
Valentine's Day cards: 5 best online card shops

Don't leave it to the petrol station: The best online card shops for Valentine's Day

Can't find a card you like on the high street? Try one of these sites for individual, personalised options, whatever your taste
Diego Costa: Devil in blue who upsets defences is a reminder of what Liverpool have lost

Devil in blue Costa is a reminder of what Liverpool have lost

The Reds are desperately missing Luis Suarez, says Ian Herbert
Ashley Giles: 'I'll watch England – but not as a fan'

Ashley Giles: 'I'll watch England – but not as a fan'

Former one-day coach says he will ‘observe’ their World Cup games – but ‘won’t be jumping up and down’
Greece elections: In times like these, the EU has far more dangerous adversaries than Syriza

Greece elections

In times like these, the EU has far more dangerous adversaries than Syriza, says Patrick Cockburn
Holocaust Memorial Day: Nazi victims remembered as spectre of prejudice reappears

Holocaust Memorial Day

Nazi victims remembered as spectre of prejudice reappears over Europe
Fortitude and the Arctic attraction: Our fascination with the last great wilderness

Magnetic north

The Arctic has always exerted a pull, from Greek myth to new thriller Fortitude. Gerard Gilbert considers what's behind our fascination with the last great wilderness