Select Committee on BBC Charter Review Minutes of Evidence


Examination of Witnesses (Questions 1300 - 1319)

TUESDAY 13 DECEMBER 2005

Mr Mark McCafferty

  Q1300  Lord Kalms: Do you have any view on the BBC's role and how they have approached it before and how committed they are? Are you satisfied as an organisation that the BBC has the right outlook as far as the free-to-air facilities which is their objective?

  Mr McCafferty: Are you asking me as consumer or as a sport?

  Q1301  Lord Kalms: I am trying to get a view of how you think the BBC approaches something like your organisation. How competitive are they, for a start?

  Mr McCafferty: I can tell you that when the highlights package was put together with the Powergen Cup and the autumn internationals highlights, that package was marketed and we approached ITV and I think Channel Four as well and the BBC came out on top of that, so in that sense they have free-to-air coverage of the game both at a club level and at an international level outside the Six Nations, as it were. So from that point of view you would have to say that they won that bid. The generally held view within the sport in recent years seems to be that they possibly should have been a bit more aggressive on the Heineken Cup and at that point should possibly have—

  Q1302  Lord Kalms: Taking your product as you have got it now, how do you think the BBC evaluates that? What do you think their criteria will be because you are going to come up against them in a few years' time? What are they really looking for from you for their audiences?

  Mr McCafferty: I think the way that I see our job on that front is that we would be for the main Premiership competition back out into the market-place in about three years' time. Our job in the meantime is to make our product on the pitch as successful as possible and as attractive as possible to as many people as possible. That is a combination of live audiences and hopefully an indication is given to us in terms of growing live audiences that the product is becoming more and more attractive to a larger number of people. It could be a function also of the highlights package season in and season out. That is why I make the point that having that showcase product on there for people who perhaps do not want to watch a whole game from start to finish but are interested in watching the highlights we can perhaps draw them into the game. All of that put together in such as way as when we go back out to market in three years' time people will say, "Look, this is an even more attractive product than it was three years ago." In terms of those who are then willing and able to bid for those there is not a lot I can do to control that. That is a function of how other organisations operate and what the market-place looks like at that point in time. What I can control is that our product looks very attractive both from where it is today and where it is vis-a"-vis other sports and that is the way we would look to evaluate each season, how are we doing, what does the product look like, how many people are watching us, how attractive it is, how do we deal with things like speed of play and disciplinary matters or areas like that.

  Q1303  Lord Kalms: One more thing on this because if the BBC stopped bidding for you, you would be in a much weaker position vis-a"-vis Sky. If the BBC decided for one reason or another they did not want your product, you would be in a much weaker position to negotiate a price, if the BBC came out and said, "We do not want your product of Rugby League." Would you envisage a scenario where the BBC had to make a bid for your product? In other words, do you think it ought it be a listed sporting event? Does it ever worry you that you might only have one buyer at some stage?

  Mr McCafferty: It is not something we lose a lot of sleep over currently because we know that we have the next three or four years in which our main concentration is not the actual bidding of those rights but the process I described in terms of making the product more attractive. I think inevitably if you think your customers or the market-place is going to shrivel down to one potential purchaser then any business would be worried about that prospect. That is a natural conclusion. There are other channels there that have shown interest in sport. I think you have obviously had a discussion about cricket as one for instance. Clearly Channel Four did a very good job of moving cricket forward. I think our job in the next few years is to make our product as attractive as possible to as many different broadcasters as possible, and that is the only thing we can influence. I only worry about things I can influence; I do not worry about things I cannot.

  Q1304  Lord Peston: I am going to ask about radio coverage but could I just check I have understood what you have said so far. You are involved with 12 professional rugby clubs and therefore on a typical weekend there would be six matches?

  Mr McCafferty: Covered on television?

  Q1305  Lord Peston: No, I mean that they play between the 12?

  Mr McCafferty: Correct.

  Q1306  Lord Peston: So the 12 play each other and there will be six matches. Do they play each other twice a season or four times a season?

  Mr McCafferty: Twice a season.

  Q1307  Lord Peston: If we take the six matches what is the average gate at those six matches?

  Mr McCafferty: We would average about 10,000 in the ground per game.

  Q1308  Lord Peston: So only 60,000 people watch real rugby in that sense?

  Mr McCafferty: Correct.

  Q1309  Lord Peston: That is the perspective I wanted, 60,000 people would be at the matches. That is the background to the radio coverage. The obvious question first of all is if only 60,000 people are interested in going is there anybody who wants to listen to it on the radio at all?

  Mr McCafferty: I think I maybe take issue with the statement that only 60,000 people are interested in going.

  Q1310  Lord Peston: There are more than that at Manchester United in one game?

  Mr McCafferty: It is a function also of what ground capacity you have.

  Q1311  Lord Peston: Okay?

  Mr McCafferty: We have nine of those 12 clubs operating at over 75 per cent capacity and six of them are operating at over 90 per cent capacity.

  Q1312  Lord Peston: It is not a question of the share, what is the radio audience?

  Mr McCafferty: May I just finish on that point though. One of the reasons why the financial side is the balance we have to strike and why it is important to us is because it is crucial that we invest back into that game. It is public knowledge if you take a club like Leicester they are sold out each week at just under 17,000 so they have to move that stadium up now to try and create a capacity of 25,000. This is a professional sport which relatively speaking is in its infancy and needs to move on from there. That is why the financial side is more important because we are not a mature business, we are a growing business.

  Q1313  Lord Peston: I understand that but if the BBC does have some radio coverage.

  Mr McCafferty: Yes, very good local radio coverage.

  Q1314  Lord Peston: But do you know who is listening?

  Mr McCafferty: In what sense?

  Lord Peston: In the sense when I am talking here there is no-one listening. I do not mean in the Committee; I mean in the House of Lords. What I am saying is the BBC broadcast—

  Chairman: It is not true there either.

  Q1315  Lord Peston: How many people are listening?

  Mr McCafferty: I do not know off the top of my head whether we have those figures to hand about the audience figures. What I would say is in profiling the sport it is very clear to us that there are certain parts of the country particularly that might be called rugby heartlands and within those communities we think it is a vital part of our marketing mix that we do have local radio coverage and that is part of promoting the game into that broader community. So to turn your questions on their head in one sense, it is not necessarily in the case of radio just a function of how many people are listening but the kind of promotion that that gives to the game within the local communities.

  Q1316  Lord Peston: I am not against that. Nothing I am saying is the opposite of what you are saying on that. I can see why you want radio coverage. What I want to know is why the BBC wants to cover it. We are talking about almost minorities of minorities.

  Mr McCafferty: I think in the context of local radio, and I am putting words in their mouth, I would imagine that it is quite an important part of their local sport. If you take a city like Worcester which does not have a Premiership football side and does not even have a professional League football side, it has Worcester Rugby League club which is in the top half of the Premiership table and that is where you go to in Worcester or listen to on the radio to get top-quality, professional sport in your city. The way in which that club has been built up in the local community is a testament to that.

  Q1317  Lord Peston: I can understand all that and I think we are being unfair to you because the people we ought to ask what is the audience size is the BBC themselves and we will be having them back and they can explain it. What troubles me, and it goes back to Lord Holme's question, is why Sky are bidding for any of this. We are talking about very few people in terms of who are interested in rugby.

  Mr McCafferty: Everybody accepts that football is in a different league in terms of scale to any other sport but I think in terms of the other sports beneath that we are talking in the case of Rugby Union about quite a large scale sport within that second tier within England, and we would be competing against other sports for a share of voice and eventually getting people to part with their hard-earned money to come and watch the games or to participate in the sport.

  Q1318  Lord Peston: But to summarise your view, would I be right in saying you see the BBC's radio coverage as very much coverage that would be helpful to you in promoting Rugby Union Football in this country? That is your vision of it?

  Mr McCafferty: It is certainly a very important part of our marketing mix, yes.

  Q1319  Chairman: Just going back on one of those figures, do I not also remember you saying that for one of the games (this is top of the table) you had two million people watching.

  Mr McCafferty: For a Premiership game, in other words as part of the Sky package we would expect about 200,000 for an end of season game.

  Chairman: 200,000? I beg your pardon, I got that wrong. Lord Holme?


 
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