ASX:SWM Nine alone in bid for Melbourne Cup rights after Seven withdraws

Seven is the broadcast partner of all other major racing events hosted by Racing NSW and Racing Victoria, a point of contention for VRC executives who would prefer the sole focus of the coverage to be on its racing carnival.

While Tabcorp has run the process, it is ultimately up to the VRC to make the final broadcast partner decision.

A withdrawal from Seven leaves Nine in the prime position to take on the rights, depending on whether VRC, Tabcorp and the broadcaster can agree to all terms.

Incumbent broadcaster Network Ten, which will air this year’s Melbourne Cup, left the process in June claiming it preferred not to proceed with negotiations due to “commercial constraints”.

Sources previously said Tabcorp wants a 50 per cent share of all wagering advertisements during the four-day carnival, while the VRC wants to control production and commentary for the race and mounting yard feeds.

These terms, which were put to the networks, were considered unworkable by several executives but is unclear if this is a major sticking point for Nine.

The Melbourne Cup is the most watched race in the local thoroughbred calendar and will be a major source of revenue for Tabcorp. A lucrative deal is also crucial to the VRC, which is under immense financial strain and reliant on the revenues from the broadcast.

The previous deal, signed with Network Ten, was worth $100 million over five years. Tabcorp is expected to stump up the majority of funds under the new deal, which will run for six years until 2029. Sources close to the process said Nine’s bid to sub-license is about $5 million per year.

Acting as a broker for the domestic broadcast rights gives Tabcorp the opportunity to put its own talent – from the company’s Sky Racing channel – and branding in front of a larger number of free-to-air viewers.

Nine has not signed a deal, and there is no guarantee the deal will go ahead. The network, which owns AFR Weekend, declined to comment. Sources close to the process said Tabcorp has not signed a deal with the VRC either, and is still subject to negotiation.

The TV ratings in metropolitan centres for the race that stops the nation have declined over the past decade, more than halving from 2.17 million in 2013, when it was broadcast by Network Seven, to 1.02 million in 2022, when it was aired by Network Ten. Some of the audience has shifted to viewing on streaming apps, like 10 Play, but it has not been enough to offset overall decline.

There is a complicated history between the VRC and the Seven Network, which is owned by Seven. This is the second consecutive rights deal in which the VRC preferred another network (Seven lost the rights to Network Ten in 2018).