'It's unavoidable that TV deals will fall apart' — Ryle Nugent

Ryle Nugent says it’s inevitable that TV and commercial deals will fall apart as a result of the coronavirus shutdown.

The former RTÉ Head of Sport has launched a new company in the past week, Stakeholder Sport, a consultancy firm for the sports industry.

That industry is now a severely challenging one for a new company, with the whole market essentially ground to a halt.

“It’s unavoidable that deals are going to fall apart based on the circumstances we find ourselves in,” he told Sport for Business.

“The biggest issue for me has been the complete disintegration of the sports industry ecosystem. Very little, if anything, is moving.

“It doesn’t matter whether you have a billion-pound industry or you’re the local mom-and-pop shop, if you have no customers you have no customers and you have no cash coming in. That is going to make any business struggle quickly and fold quickly.

“Media rights fund premium sport throughout the world. If you look at the pay subscribers, they have deep pockets but no pub and club subscriptions, lots of individuals pulling away, maybe they can sustain that for three months, six months, nine months… where’s the line where that ecosystem starts to break down for them in terms of the financial modelling?

“The knock-on effect of that is obvious. You get into issues with broadcasters, you get into issues with commercial sponsors, and each stakeholder in that chain has got its own individual issues on top of that. Frankly, it is frightening.”

If the crisis runs long enough, he says companies will be left with no option but to walk away from deals in order to stay afloat.

“A lot of this is going to come down to the length of time we’re in this vacuum. We’re talking about the difference between a postponement and a cancellation. It’s the difference between likely being paid and not being paid at all.

“If you’re relying on a rights fee and your business model is built around that rights fee, you’re in trouble if you’re forced to cancel.”

The complications around travel mean that Nugent can’t see a return to action for competitions like the Champions League or Six Nations in 2020.

“Presuming we get on top of this in a way that some freedoms are restored, you can see it being the GAA, the Airtricity League, and all other domestic sport coming back first.

It’ll be a gradual return to play and I just can’t see international, cross-border competition coming back this year.

“When you get to the bottom of the barrel, and I’ve been there, having led RTÉ Sport during the financial crisis, you can say this is what we’ve got to do. The problem now is we don’t know where the bottom is so it’s very hard to come up with an exit strategy.”