W
Wally
Guest
THE International Rugby Board has made an audacious dash for cash by deciding to slug countries an exorbitant $207million tournament fee to host the 2015 World Cup. And if any country wants to host the 2019 World Cup, it will cost a whopping $248m.
When the IRB announced after its meeting in Hong Kong on Tuesday that the hosts of the 2015 and 2019 World Cups would be decided in July next year, a major detail was left out - massive up-front tournament fees.
The Herald was told last night that the IRB had decided it would charge the 2015 World Cup host nation a tournament fee of £100m ($A207.38m). The 2019 host would be hit with a £120m ($A248.75m) fee.
This initiative surprised, even astounded some leading IRB delegates, who argued that it was unreasonable considering that many other major sporting organisations did not charge a tournament fee for world events.
This move would ensure that only a few rich rugby nations, such as England and France, could bid for World Cups from 2015 as countless fringe nations would shy off even contemplating staging the event because it would be far too expensive.
It is understood that the Australian IRB delegates were the only ones to argue at the meeting against the excessive tournament fees.
But Australia encountered widespread opposition from numerous other countries, including Scotland, Ireland and Wales - who are not in a financial position to host the tournament but could clearly see a financial windfall coming their way involving the minimum of effort. More money going into the IRB coffers means a bigger slice coming their way.
As one international rugby official told the Herald last night: "The Rugby World Cup is only just over 20 years old, but in that time the IRB had become excessively and unnecessarily greedy."
This tournament fee comes on top of the host nation having to bear all the costs of the tournament, while the IRB, through Rugby World Cup Limited, will continue receiving from the tournament all commercial revenue, including broadcasting rights, sponsorship, corporate hospitality and travel packages.
As Australia discovered when it hosted the 2003 World Cup, officials had to be shrewd to finish with a profit. The cost of staging the 2003 tournament was $120m and estimations are that the 2015 tournament will probably cost three times that.
The costs in 2003 were offset by ticket sales, which saw Australia eventually finishing with a net profit of $83m, of which the IRB received $40m - which was a tournament fee of sorts, but came out of profits and was not an up-front figure.
According to the 2011 World Cup fact sheet, New Zealand, in a partnership involving the New Zealand Rugby Union and the New Zealand Government, has "guaranteed to deliver a minimum guarantee to the IRB".
Now, in July next year, a country interested in hosting the tournament in 2019 must decide and even gamble 10years out from the actual event whether that they can provide an "ironclad guarantee" of $248m to the IRB.
That is why some IRB officials believe the only countries who may contemplate being a World Cup host would be England, France and possibly Australia and Japan. England are the favourites to host the 2015 edition, while Australia may be among the candidates, along with Japan, for the 2019 tournament.
The IRB has stressed that it wants the 2015 World Cup to make a considerable profit, especially as the 2011 event in New Zealand will not be as lucrative as the previous two tournaments in France and Australia.
Not surprisingly, the IRB press release that followed the Hong Kong meeting emphasised how the World Cup had become a money-spinner.
IRB and Rugby World Cup chairman Bernard Lapasset said the 2007 World Cup "generated a surplus of over £120m which has been reinvested into the game through grants to unions, the underwriting of international tournaments and the funding of targeted strategic high performance programmes".
WHAT OTHER SPORTS DO
CRICKET WORLD CUP
■ No charge to host nation.
■ ICC sells media rights, takes majority of ticket revenue.
■ ICC pays dividend to all Test nations who play.
■ Host nation gets normal dividend plus host bonus.
FOOTBALL WORLD CUP
■ No charge to host nation.
■ Host nation guarantees FIFA will not lose money.
■ FIFA sells TV rights.
■ FIFA claims large percentage of marketing and other media rights and ticket sales.
OLYMPIC GAMES
■ No charge to host nation.
■ IOC sells media rights and signs global sponsorship deals.
■ Hosts retain 95 per cent of ticket sales.
■ IOC contributes $US1 billion to host to help stage Games.
rugbyheaven.com
When the IRB announced after its meeting in Hong Kong on Tuesday that the hosts of the 2015 and 2019 World Cups would be decided in July next year, a major detail was left out - massive up-front tournament fees.
The Herald was told last night that the IRB had decided it would charge the 2015 World Cup host nation a tournament fee of £100m ($A207.38m). The 2019 host would be hit with a £120m ($A248.75m) fee.
This initiative surprised, even astounded some leading IRB delegates, who argued that it was unreasonable considering that many other major sporting organisations did not charge a tournament fee for world events.
This move would ensure that only a few rich rugby nations, such as England and France, could bid for World Cups from 2015 as countless fringe nations would shy off even contemplating staging the event because it would be far too expensive.
It is understood that the Australian IRB delegates were the only ones to argue at the meeting against the excessive tournament fees.
But Australia encountered widespread opposition from numerous other countries, including Scotland, Ireland and Wales - who are not in a financial position to host the tournament but could clearly see a financial windfall coming their way involving the minimum of effort. More money going into the IRB coffers means a bigger slice coming their way.
As one international rugby official told the Herald last night: "The Rugby World Cup is only just over 20 years old, but in that time the IRB had become excessively and unnecessarily greedy."
This tournament fee comes on top of the host nation having to bear all the costs of the tournament, while the IRB, through Rugby World Cup Limited, will continue receiving from the tournament all commercial revenue, including broadcasting rights, sponsorship, corporate hospitality and travel packages.
As Australia discovered when it hosted the 2003 World Cup, officials had to be shrewd to finish with a profit. The cost of staging the 2003 tournament was $120m and estimations are that the 2015 tournament will probably cost three times that.
The costs in 2003 were offset by ticket sales, which saw Australia eventually finishing with a net profit of $83m, of which the IRB received $40m - which was a tournament fee of sorts, but came out of profits and was not an up-front figure.
According to the 2011 World Cup fact sheet, New Zealand, in a partnership involving the New Zealand Rugby Union and the New Zealand Government, has "guaranteed to deliver a minimum guarantee to the IRB".
Now, in July next year, a country interested in hosting the tournament in 2019 must decide and even gamble 10years out from the actual event whether that they can provide an "ironclad guarantee" of $248m to the IRB.
That is why some IRB officials believe the only countries who may contemplate being a World Cup host would be England, France and possibly Australia and Japan. England are the favourites to host the 2015 edition, while Australia may be among the candidates, along with Japan, for the 2019 tournament.
The IRB has stressed that it wants the 2015 World Cup to make a considerable profit, especially as the 2011 event in New Zealand will not be as lucrative as the previous two tournaments in France and Australia.
Not surprisingly, the IRB press release that followed the Hong Kong meeting emphasised how the World Cup had become a money-spinner.
IRB and Rugby World Cup chairman Bernard Lapasset said the 2007 World Cup "generated a surplus of over £120m which has been reinvested into the game through grants to unions, the underwriting of international tournaments and the funding of targeted strategic high performance programmes".
WHAT OTHER SPORTS DO
CRICKET WORLD CUP
■ No charge to host nation.
■ ICC sells media rights, takes majority of ticket revenue.
■ ICC pays dividend to all Test nations who play.
■ Host nation gets normal dividend plus host bonus.
FOOTBALL WORLD CUP
■ No charge to host nation.
■ Host nation guarantees FIFA will not lose money.
■ FIFA sells TV rights.
■ FIFA claims large percentage of marketing and other media rights and ticket sales.
OLYMPIC GAMES
■ No charge to host nation.
■ IOC sells media rights and signs global sponsorship deals.
■ Hosts retain 95 per cent of ticket sales.
■ IOC contributes $US1 billion to host to help stage Games.
rugbyheaven.com