FOUR CORNERS

For the Good of the Game

Broadcast: 8/4/2002
Reporter: Ticky Fullerton

Why are some clubs facing extinction when the AFL's product is booming?

TICKY FULLERTON, REPORTER: Football is back, with Collingwood President Eddie McGuire in the box seat.

Here at the MCG, home to AFL and warm beer and plastic cups, the first ball of the season bounced to a crowd of 65,000.

Even club games pull crowds which soccer, rugby union and league can only dream about.

EDDIE MCGUIRE, COLLINGWOOD PRESIDENT: It's the equivalent of having 11 Madonna concerts.

We put on 11 major events at the MCG with an average crowd of 70,000.

TICKY FULLERTON: AFL wants to be bigger, the undisputed national football code, but that goal may mean casualties.

A third of the clubs are making losses.

Two heartland clubs in Melbourne could be gone within three years.

DAVID SMORGON, PRESIDENT, WESTERN BULLDOGS FOOTBALL CLUB: It doesn't take much for a club like us, that lives on the edge, and a couple of things don't happen, and all of a sudden you're nearly down and out.

TICKY FULLERTON: The big clubs and their footy moguls believe in survival of the fittest.

JOHN ELLIOTT, PRESIDENT, CARLTON FOOTBALL CLUB: I would say at least --

I think probably two clubs will go out of Melbourne.

EDDIE MCGUIRE: If it means one or two can't cut the mustard anymore, well, then, the hard decisions are going to have to be made.

TICKY FULLERTON: Tonight on Four Corners, the hard decisions.

Will the AFL's powerbrokers sound the death knell for struggling clubs in the rush to become Australia's national game?

CROWD SING: (Carlton club song) * And they will know that they've been playing * Against the famous old dark blues.

* JOHN ELLIOTT: That was dreadful.

CROWD: (laughs) JOHN ELLIOTT: That was really bad.

I want everybody on their chairs.

Come on, up you get, on your chairs.

We're going to do it again.

Come on, players, get on the chairs.

Hop on your chairs.

All on your feet, all on your chairs.

Righto, let's do it one more time, in a rousing fashion.

CROWD: * Dum da dum da da Dum da dum da da * Dum da dum da da da dum da da Da da da * We are the navy blues * We are the old dark navy blues * We're the team --

* TICKY FULLERTON: In Melbourne, they say you have to be Victorian to understand the AFL's hold on the psyche.

JOHN ELLIOTT: Well, there's only two sporting seasons here -- the footy season and the pre-footy season.

TICKY FULLERTON: John Elliott has been Carlton President for nearly 20 years, and barracking since he was seven.

To him, it's tribal.

JOHN ELLIOTT: You know, Carlton -- we hate Collingwood, we hate Essendon, we hate Richmond.

We haven't had time to hate Brisbane and West Coast and Adelaide yet.

TICKY FULLERTON: Three kilometres south-east are Carlton's rivals, the Collingwood Magpies.

STADIUM ANNOUNCER: And gentlemen, would you please welcome the President of the Collingwood Football Club, Eddie McGuire?

EDDIE MCGUIRE: Thanks, everybody, and welcome to McHale Stadium at Victoria Park.

And all the young Magpies out there as well, and I brought one of my own today, which is fantastic.

I remember the first time I came here with my dad, and, ah, that's why we're all here today.

TICKY FULLERTON: Here, young Magpies get to see their heroes in the flesh.

For seven years, they've missed the finals.

This year, God will be on their side.

Three priests and a rabbi have been asked to bless the Magpies scarves.

EDDIE MCGUIRE: All the scarves up in the air.

TICKY FULLERTON: Collingwood and Carlton are the political powerhouses of club football.

There's one man more in demand than any footy captain.

In Melbourne, he's simply known as Eddie.

Club president and controversial game caller, 'Footy Show' and 'Millionaire' host, 'Herald Sun' columnist and shareholder in the State footy tipping company.

And as we'll see, a symbol of AFL power concentrated in the hands of a few.

You need to be a businessman to run a club these days, because losses on the field hurt, but financial losses kill clubs.

GARRY WALDRON, INSTITUTE OF CHARTERED ACCOUNTANTS: There may well be a number of clubs that are struggling, and I wouldn't have thought that it was restricted to just two.

TICKY FULLERTON: So, you may have -- what -- five, six clubs?

GARRY WALDRON: Yeah, look, it could be that many who are struggling on a year to year basis to raise enough revenue to remain in the competition.

TICKY FULLERTON: This year, 6 of the 16 clubs have posted losses and others are deep in debt.

Two -- the Western Bulldogs and the North Melbourne Kangaroos -- are now on football's death row.

ANDREW DENTON (to Rabbitohs fans): We're not in debt, and how many other clubs can say the same?

TICKY FULLERTON: The nightmare for the AFL is that it repeats the costly mistake of rugby league when those in power deemed the South Sydney Rabbitohs expendable for the good of the game.

DISTRESSED WOMAN: I'm -- I'm sorry, I'm sorry.

South Sydney is my life.

TICKY FULLERTON: In AFL, to stay alive and kicking clubs make most of their revenues from takings at the gate, corporate sponsorship, and very importantly, club memberships, which deliver up-front cash every year.

The fight for dollars is fiercest in AFL's heartland of Melbourne.

It's a legacy of AFL history.

Aussie Rules was invented in the 1850s in Melbourne and, for almost a century, it was the VFL -- Victorian Football.

The home-grown game had no prospects overseas so the goal has been to grow nationally.

In 25 years, the AFL has spread west, with two clubs in Perth and two in Adelaide, and north into union and league territory with the Brisbane Lions and the Sydney Swans.

But, of the 16 clubs, 10 are crammed into Victoria.

DAVID SMORGON: We play like Bulldogs, we act like Bulldogs.

So what's a Bulldog?

Bulldogs, I think, are tenacious, we're relentless, we never give up.

You're always in there barking.

TICKY FULLERTON: The Bulldogs need all their tenacity.

But for a rescue package in 1996, the club would be history.

For businessman David Smorgon the last five years have been touch-and-go.

Last year, Bulldog losses tipped $1.7 million.

DAVID SMORGON: It's been very difficult.

It's been also very frustrating.

I can tell you, ever since our major sponsor from previous years -- last year left us, you know, we've probably spoken to nearly 80 companies and we haven't yet cracked it.

TICKY FULLERTON: David Smorgon's problem is that sponsors like supporters.

In Melbourne terms, the Bulldogs are a young club, started in 1925, and their territory is small.

Membership this week runs at 16,000.

DAVID SMORGON: What do we need?

Probably double that.

We really need 30,000.

The maximum we've ever got is just a touch over 20.

And it's a constant battle.

TICKY FULLERTON: The Bulldogs' merchandising effort last year netted a miserable $4,000.

They made $100,000, but spent $96,000 to do it.

And the club's move to the new Colonial Stadium cost it over $600,000.

Smorgon's message is blunt.

DAVID SMORGON: We can't afford to have another funeral of our club to let our real supporters then come out and say, "Oh, yes, you're down-and-out -- I'll put in."

What we have to change is the attitude.

And we've been working very hard to change that attitude.

We need you when you're here.

We need you while we're surviving and alive, not wait till we're almost down-and-out.

TICKY FULLERTON: So, how can a competition worth millions have clubs living hand-to-mouth?

While clubs are small, the AFL is big business.

Colonial Stadium will belong to the AFL in 24 years for the up-front fee of $30 million.

Then there's the $110 million windfall from the sale of Waverley Park.

And the final triumph -- $100 million a year for five years for the sale of AFL's TV and Internet rights.

But it's how this revenue pie is carved up that will drive the future of football.

Money is needed for spectators, to upgrade the grounds and subsidise tickets, to pay the players, to help grow the game and, finally, for the competition, the clubs themselves.

The AFL is well aware of the rich club/poor club divide.

In the 1980s, it tried to make a more level playing field between the clubs.

To keep the game even, there is now a salary cap on the total that a club can spend on players.

To help the weak clubs, all clubs gave up their precious colours and finals tickets to central marketing by the AFL.

The money is pooled and shared equally between the 16 clubs.

This year, clubs get $3.5 million each.

But equality only goes so far.

For club games, gate takings belong to those playing.

For this Collingwood/Richmond game, it's $125,000 each.

The AFL controls the fixture.

It wants big crowds, so the strong clubs get the blockbusters.

DAVID SMORGON: Well, you've never seen the Bulldogs, the Kangaroos or St Kilda, to use three clubs, play on Anzac Day or play on Queen's Birthday.

That's where it needs to be a little bit more equalised than what it is today.

TICKY FULLERTON: Football's pre-season king hit happened to the financially weakest club in the league -- the Kangaroos, the old North Melbourne.

WAYNE CAREY, FORMER KANGAROOS CAPTAIN: For the wellbeing of all concerned, I have taken the decision to cease my playing career with the Kangaroos.

TICKY FULLERTON: Star Kangaroos' captain Wayne Carey's liaison with his vice-captain's wife could not have come at a worse time.

PATRICK SMITH, AFL COLUMNIST, 'THE AUSTRALIAN': I think they paid him a million so that the club would get three.

And they'd get that three through membership, sponsorship, coteries and attendance.

TICKY FULLERTON: There's now speculation of a $500,000 to $700,000 payout for a captain who won't play this year.

Four Corners caught up with Kangaroo President and former footy legend Allen Aylett in Adelaide 10 days ago.

The Kangaroos were up against pre-season competition winners Port Adelaide Power.

Victory was sweet.

But Allen Aylett knows he needs more than on-field success.

The Kangaroos were a powerhouse of the '90s but a failed attempt at the Sydney market left them battered and bruised.

ALLEN AYLETT, PRESIDENT, KANGAROOS FOOTBALL CLUB: Well, we're winning games on the field.

We got a little bit loose in our administration towards the end of the last decade.

TICKY FULLERTON: Dropping the financial ball has meant two years of consecutive losses for the Kangaroos.

Your bank overdraft facility and the $1 million loan facility expired late last year.

You've had a $934,000 loss this year on top of a loss of over $1 million last year.

How is this plan going to demonstrate that the club can be turned around?

ALLEN AYLETT: Well, there are many areas that we've examined.

Um, and again, with efficient administration, we believe that we can certainly cut costs.

TICKY FULLERTON: Despite two premierships in the '90s, membership sits at 14,000.

Allen Aylett hopes for 25,000, but like the Bulldogs, his catchment is tiny.

The loser today, Port Adelaide, has a membership of over 35,000.

That's the upside of being only one of two clubs in South Australia.

Back in Melbourne, this is what the Bulldogs and Kangaroos are up against.

AFL's self-styled majesty united -- the Essendon Bombers.

130 years of broad support, its membership is the highest in Melbourne -- 33,000.

PETER JACKSON, CHIEF EXECUTIVE, ESSENDON FOOTBALL CLUB: These are all the legends that we've inducted into the hall of fame.

TICKY FULLERTON: And has any other clubs got anything like this?

PETER JACKSON: Not that I'm aware of --

TICKY FULLERTON: The challenge for Bomber chief executive Peter Jackson, a businessman brought in from outside the game, is what to do with all the money.

PETER JACKSON: We've got cash reserves in total of about $5 million.

We're spending $2.5 million as we speak on buildings, new office facilities, a gymnasium, lecture theatre, that sort of thing -- new merchandise store.

TICKY FULLERTON: Wooed by champion coach Kevin Sheedy and all the off-field support, players took a pay cut so the club could keep under the salary cap.

KEVIN SHEEDY, COACH, ESSENDON, FOOTBALL CLUB: I think that is a fairly wise decision because we've got a good list.

You know, if you wanna have success sometimes it's not gonna be the money that actually gets you the success.

TICKY FULLERTON: It's another tilt to the level playing field.

Allen Aylett at the Kangaroos is also forcing pay cuts but out of necessity.

ALLEN AYLETT: If the performances are there, the revenue will be there.

If they're not there, well, then the players may not get as much money as they've received in the past.

PETER JACKSON: It cost this club about $22 million last year in total expenditure.

Um, that's up from about $5 million in 1992.

So, we've gone up by fourfold in 10 years.

TICKY FULLERTON: Essendon can keep up with rising costs but weak clubs can't.

Last year, the Bombers made $22.6 million, $13 million more than the Kangaroos.

Rising costs is exactly what the Institute of Chartered Accountants identifies in its independent report on the clubs.

GARRY WALDRON: Well, over the last two or three years, revenues have been going up by about 12 per cent, um, across all clubs.

Costs have been going up even higher.

And that means the profit margins of clubs are being squeezed.

TICKY FULLERTON: The big cost is the players.

The AFL has struck a generous deal on behalf of all clubs and the average salary has rocketed from $100,000 to $150,000 in three years.

Brendon Gale is a former Richmond captain and now a ruck coach.

BRENDON GALE, AFL PLAYERS' ASSOCIATION: It's a very sensitive area.

And, er, if we pursue our wage claims too aggressively, you know, we could be seen to be holding a gun to the clubs' heads.

There's no doubt about that.

I mean, we wanna avoid that situation.

But, um, you gotta draw the line at some stage.

I mean, how long do you continue protecting the interests of struggling clubs and --

..and holding the other player group back?

TICKY FULLERTON: Does that put a lot of stress on a club like --

ALLEN AYLETT: It does.

My word, it does.

My word, it does.

And, er, that's why the AFL commission have got to continually listen to what it's like out here at the coalface.

TICKY FULLERTON: Such is the stress that seven clubs have called for an advance on their share of AFL money -- $3.5 million.

The AFL is also giving $2 million to each club from the sale of Waverley, providing it's either for capital spending on ground improvements or to pay off long-term debt.

Then late last year, the AFL, for the first time, announced a special assistance fund to help clubs under threat -- up to $3 million each.

This was a step too far for the powerful club presidents.

PATRICK SMITH: The top five Victorian clubs -- the likes of Collingwood, Richmond, Essendon, Carlton, Hawthorn -- they got together and sought a proposal that said, "We're going to take some of your money "and we're going to give it to the poor clubs.

"And we'll do that by taking the money "you get out of gate receipts at your blockbusters, "put it in the equalisation fund "and that way we can channel it to the Bulldogs "and to North Melbourne."

Not a very good idea, according to the top five clubs, because it's money --

big, big money to them -- $500,000 a blockbuster game.

TICKY FULLERTON: Last October at this Crown Casino restaurant, the big five privately lobbied the AFL's chairman, Ron Evans, asking him to think again.

JOHN ELLIOTT: We basically said, "Hey, Ron, we're here "because we're not going to ask you for any money.

"We'll look after ourselves."

But we were trying to get a better basis on which --

..we were trying to establish a basis and we were unified in our view as to how money should be handed out to weaker clubs to keep them going.

TICKY FULLERTON: Elliott and McGuire convinced the AFL to leave their blockbuster money alone.

Instead, the rescue funds come out of the overall football pie.

Chief executive of the AFL Wayne Jackson says such distinctions are nonsense.

It's all footy money.

WAYNE JACKSON, CHIEF EXECUTIVE, AFL: Well, I can only deal with the facts and the facts are that on November 26, 2001, all 16 clubs unanimously supported the financial strategies of the competition, which did provide for funding to go to some of the financially struggling clubs under certain strong conditions and those same strategies were unanimously endorsed on March 20, 2002.

TICKY FULLERTON: So far, the AFL has only handed over $900,000 from the new rescue fund.

That's for the Bulldogs.

As strong as the game is, the AFL refuses to be an open chequebook propping up clubs forever, so clubs must show they can turn around their fortunes.

And the AFL also insists on sending in their own man.

In one highly influential AFL insider's words, "a corporate doctor".

Who are these corporate doctors?

WAYNE JACKSON: Um, we've never used, Ticky, the word 'corporate doctor'.

Is that your terminology?

TICKY FULLERTON: No, it's not, actually.

WAYNE JACKSON: Well, the AFL'S never used the word 'corporate doctors'.

We're not bringing corporate doctors.

We're asking clubs to have financial plans, to have strategic plans in place.

We will appoint an independent financial adviser.

That person will form a view as to whether the plans are viable, just as you would do in normal practice.

TICKY FULLERTON: Have you heard of these corporate doctors that might be brought in to, um, help you as consultants?

ALLEN AYLETT: Yes, we're working with those people now.

Yeah.

TICKY FULLERTON: So far, the Kangaroos have not presented their business plan to the AFL.

Are the Kangaroos technically insolvent?

WAYNE JACKSON: I think that's a question you should ask the President of the Kangaroos.

I'm sure you will.

TICKY FULLERTON: Are the Kangaroos technically insolvent right now?

ALLEN AYLETT: No, definitely not.

No.

TICKY FULLERTON: But the Kangaroos do have a nasty problem.

They've lent $1.6 million to their loss-making social club.

If that can't be repaid, it would bankrupt the club.

In the club's 2000 accounts, directors believed the loan to be recoverable.

The auditors disagreed, saying it was unlikely in the foreseeable future.

The loan payable to the Kangaroos has ballooned from $1.6 million to $2.2 million.

How can that be recoverable?

WAYNE JACKSON: Well, again, you should ask the Kangaroos that question.

We do not manage the Kangaroos football club, so we'll look forward to seeing how that is dealt with in the financial budgets.

TICKY FULLERTON: This year, both the footy club and the social club are gambling on a move to Colonial Stadium, where the social club hopes to make the loan back on the pokies.

ALLEN AYLETT: We are very, very confident that there'll be revenues earned that we'll repay that loan.

TICKY FULLERTON: Because, if there isn't, it would wipe you out, wouldn't it?

ALLEN AYLETT: That's right.

That's why we're absolutely certain that there is revenues coming to us.

TICKY FULLERTON: The Kangaroos say the AFL is holding up their business plan.

They want compensation for developing the Canberra market with home games there.

And they want their share of Waverley money to fix short-term trading problems.

The AFL thinks that money should be used to pay off long-term debt.

Between November and last month's football AGM, Allen Aylett claims the goal posts have been moved.

ALLEN AYLETT: The more and more we, uh --

we asked for assistance, the more and more the rules changed, gradually changed, until they were presented in a form that they presented to us on, uh -- March 18.

WAYNE JACKSON: It is frustrating that, uh -- people will claim, in a very public sense, they need financial help, and the process is so clear, and the process is being supported by them in very detailed forums with all other clubs.

TICKY FULLERTON: Short-term relief should come for struggling clubs.

However, the accounting institute's Garry Waldron warns that it may bring them more than they bargained for.

GARRY WALDRON: I think, if the club receives that sort of support, it may have consequences for them in the -- the AFL's role in their decision-making going forward, and also, it may have an effect on their members and supporters in their willingness to put their hand in their pocket.

TICKY FULLERTON: Losing supporters is the last thing David Smorgon needs.

But losing control to the AFL is serious.

It's what happened in the Chris Grant affair.

DAVID SMORGON: Well, I think you should be careful.

It wasn't a Chris Grant affair.

It was a Chris Grant neck problem.

TICKY FULLERTON: The AFL found out about the Bulldog captain's neck problem last July, and allowed him to play on last season, but stopped him playing in this year's pre-season cup, while it sorted out insurance.

WAYNE JACKSON: All we wanted to do is to have, uh --

..and have had as paramount is Chris Grant's health.

That has been satisfactorily resolved in the last week or two.

TICKY FULLERTON: But he was playing when you knew about it.

WAYNE JACKSON: I'm sorry.

It's been resolved in the last week or two.

TICKY FULLERTON: Pub talk in Melbourne was that the problem would've been quickly fixed if Grant had been at Essendon or Carlton.

JOHN ELLIOTT: Well, I don't think anybody would bully Carlton.

I'm at Carlton, and I don't have those sorts of problems, because we're much more financially secure than the Bulldogs.

I think it was an AFL error, actually.

We would've exposed it.

PATRICK SMITH: Go back 10 years and I think that the clubs were pretty feisty.

But now the AFL has the money.

They've got $500 million in TV rights.

They've just sold Waverley Park for $110 million.

I'd be very nice to the AFL too if I was a club.

TICKY FULLERTON: What should worry the weak clubs is that the AFL has other places to put its money.

The real competition, as the AFL sees it, is against the other codes -- rugby league, union and soccer.

The ground to be staked out is here in Queensland and New South Wales -- home to half of Australia's population and the really big sponsorship dollars.

If footy is a business, then Ann McEvoy is the ideal new customer.

Ann is a convert from a rugby league family, now hooked on the Brisbane Lions.

Last year, Ann spent 48 hours on a bus to Melbourne to see her Lions, then the underdogs, take the flag.

ANN MCEVOY, AFL FAN: It was amazing to be, you know, over 90,000 people at the MCG, and a lot of supporters where we were sitting were obviously the Lion supporters, You know, I found that my, um --

..my cheeks were sore for smiling.

TICKY FULLERTON: The Lions' win was a victory for AFL expansionists, chasing sponsors and TV revenue.

The Lions are only six years old, after a bankrupt Melbourne team -- Fitzroy -- moved north and merged with the Brisbane Bears.

New Lions members more than make up for disaffected Fitzroy supporters.

Down in Sydney, the sponsors' stronghold, is the man who's spent years growing the national game -- Sydney Swans Chairman Richard Colless.

The Swans also migrated from Victoria.

They were the old South Melbourne footy club.

RICHARD COLLESS, CHAIRMAN, SYDNEY SWANS FOOTBALL CLUB: There is absolutely no doubt that the most diverse, competitive football market in the world is Sydney.

Now, people in Melbourne laugh until you take them through.

This is the home of world rugby league.

This is the cradle of Australian soccer.

More than half the NSL teams reside in our catchment area.

You could argue now that Southern Hemisphere rugby is the dominant component of world rugby.

TICKY FULLERTON: This is Auskick, the AFL's development program, busy winning over boys AND girls in New South Wales and Queensland.

Today, it's Parramatta.

PAUL KELLY, CAPTAIN, SYDNEY SWANS FOOTBALL CLUB: I think 420,000-odd kids either had a clinic or played Auskick or something last year.

And that will continue next year.

And I suppose in the Paul Kelly Cup, we've got about 13,000 kids in the State playing in it.

TICKY FULLERTON: Auskick depends on development money from the AFL.

Last year, $8 million from the football pie went to Queensland and NSW.

But Melbourne powerbrokers feel neglected.

Last year, they voted off a Western Australian AFL commissioner thought of as anti-Victorian.

They also claim much of the development money Richard Colless is after is really for the Swans.

JOHN ELLIOTT: Well, I don't know that he's done much up there, other than, you know, reef off some money for the Swans.

EDDIE MCGUIRE: You know, as Paul Keating once said, in the race of life, always back self-interest -- at least you know it's trying.

I mean, let's not muck around.

Richard's trying to win a premiership up there in Sydney and the AFL are doing their best to help him.

Now we've just got to make sure that we don't turn away the legions of fans who have made this game over 105 years to get to the position it is by being a little bit overzealous for the Sydney market.

Yeah, help, develop, do the rest of it.

But if you're -- you're not going to come to a fixed match, are you?

And clubs -- you know, all these people aren't going to fork out $120 to come and watch Collingwood not make the finals every year because they can't.

TICKY FULLERTON: Despite the sniping from down south, the evidence is that far from taking State development money, the Swans have spent a lot of their own on growing the game.

RICHARD COLLESS: Now, we do -- and this is a literal figure -- 10 times the amount of development work that Collingwood does.

10 times.

It costs us somewhere between $300,000 and $400,000.

We don't get recouped a cent.

I would argue that what we're doing -- and we're getting a little bit sick of it, I might tell you -- is a lot of the grunt work that some of these other clubs, particularly the Melbourne-based clubs, particularly some of the more powerful clubs, should have been doing for a long, long time.

TICKY FULLERTON: The AFL clearly values Richard Colless.

In February, it released the Carter Report on the future of the game.

But Carter's call for a doubling of development money to NSW and Queensland to $16 million has to get past the big Melbourne clubs.

EDDIE MCGUIRE: Well, I think you always have to have a look at figures when there's clubs in Melbourne that are about to fall off the perch.

I mean, you have to give them a chance.

Having said that, we've also been strong in saying we're not going to prop up clubs forever.

TICKY FULLERTON: The big five from the infamous Melbourne lunch reportedly want the AFL to shift development money to help weak Melbourne clubs.

The Swans Chairman is not impressed.

RICHARD COLLESS: Some of the more high-profile people in Melbourne with considerable media expertise, business expertise, I think could do far more to grow the game rather than indulging too often in what I would call petty parochial football politics.

TICKY FULLERTON: He says he's developing the competition --

EDDIE MCGUIRE: Oh, yeah.

TICKY FULLERTON: ..and that high-profile people in Melbourne -- quote -- "could do a lot more to grow the game "rather than indulge in petty parochial football politics."

EDDIE MCGUIRE: Yeah, well, good on him.

RICHARD COLLESS: I think it is unbelievably arrogant for some people, whose teams haven't been in the finals for X number of years who until recently, have been losing money, to classify themselves as rainmakers in the AFL.

I mean, it's just -- it's ludicrous and it's -- it's --

it belongs to a bygone era.

TICKY FULLERTON: The -- it's not just the money --

RICHARD COLLESS: So can I do that to Eddie?

(Sticks finger up)

TICKY FULLERTON: (Giggles)
There are powerful figures who feel the game's development in Victoria is being overlooked.

Scotch College in Melbourne played the first game of AFL in 1858.

In the late 1980s, there were twice the number of Aussie Rules teams at Scotch than soccer.

Now it's about even.

JOHN ELLIOTT: We in the Melbourne clubs believe far too great a proportion of what's being spent is going to the north.

And it should be spent to attract people to watch the game, not to try and create players who have been traditional rugby players.

It costs, I think, about six or seven times more to develop a footballer in the north than it does in the traditional football States.

TICKY FULLERTON: Against the grand national vision, the future of weak Melbourne clubs looks bleak.

Dependent on AFL money, they could be pressured to fold or merge, a fate only slightly better than death.

But could the AFL force a move interstate?

GARRY WALDRON: Oh, it might if the numbers that they were contributing became significantly large and looked to be ongoing numbers.

ALLEN AYLETT: I asked Mr Jackson that question on March 18 in front of the other 15 presidents and chairmen.

And he said, "No, that is not a part of the policy "of the AFL Commission."

TICKY FULLERTON: The AFL categorically denies it will be applying pressure to clubs, and remains committed to a 16-club game.

But it won't commit to keep subsidising strugglers in Melbourne to keep them in the game.

Do you think a 16-club game is sustainable?

BRENDON GALE: I think it is. And --

TICKY FULLERTON: 10 in Melbourne?

BRENDON GALE: No, I don't think that is.

At a -- at a conference for our executive and delegates in November, we were largely committed to the idea of a 16-team competition, but the players were reluctant to commit to a 10-team Melbourne competition.

JOHN ELLIOTT: I would say, at least --

I think probably two clubs will go out of Melbourne.

Much and all as I don't like the idea of it, and we'd like to support them --

EDDIE MCGUIRE: If it means one or two can't cut the mustard anymore, well, then the hard decisions are going to have to be made.

TICKY FULLERTON: That's not what Kangaroos' supporters want to hear.

SUPPORTER 1: It's horrible, because, you know, you put a lot of time and money and effort into going for your team, and then what are you supposed to do?

SUPPORTER 2: Devastated.

SUPPORTER 3: Devastated, yeah.

SUPPORTER 2: Devastated.

Probably couldn't barrack for another side, either.

Give it up, give it away.

SUPPORTER 4: Why get rid of a team that's been in the comp since 1925?

It's just not fair.

It's not fair on the supporters and the people who support the club.

ALLEN AYLETT: When it's all said and done, it's the 16 clubs, it's the competition, the viability and the power of the competition -- the 16 clubs playing against one another -- that brings in all the revenue.

It's not Mr Jackson, or anyone else.

TICKY FULLERTON: Much has changed for Allen Aylett.

In the 1980s, he drove the national game by moving the South Melbourne Swans to Sydney.

Now, he warns of the painful lesson of rugby league's South Sydney Rabbitohs.

Having seen the dramas close up, Richard Colless agrees.

RICHARD COLLESS: Not only do you disenfranchise hundreds of thousands of supporters of that club, you end up with a lot of disillusioned AFL supporters, who have an alignment with another club, who say, "How can this be, in this time of plenty, "with all this money that appears to be pouring into the system, "how can our club have gone out of business?"

TICKY FULLERTON: The national game is powering ahead, thanks to $500 million for AFL's TV and Internet rights.

Now, more than ever, power sits in the hands of a few.

Let me put it to you that you are one of the top faces of Channel Nine, yet your lawyer and the AFL's lawyer were one and the same.

EDDIE MCGUIRE: Yeah, Geoff Brown, yeah.

TICKY FULLERTON: Geoff Brown.

Doesn't that present an extraordinary potential conflict of interest, when you've got Seven competing with Nine and Foxtel for those rights?

EDDIE MCGUIRE: He's also the girlfriend --

the boyfriend of Anne Fulwood.

One of Seven's main people.

And I think he has negotiated contracts for Jennifer Hansen at Channel 10.

So --

TICKY FULLERTON: But you and Anne Fulwood are slightly different in the deal-making stakes.

EDDIE MCGUIRE: Yeah, but I don't think that's --

I mean, look, I suppose on the surface you could say, "Yeah, it is."

But where?

TICKY FULLERTON: How can Geoff Brown be the lawyer for Eddie McGuire, the face of Channel Nine, and also for the AFL during the TV rights deal?

WAYNE JACKSON: I'm not aware that Geoff Brown is the lawyer for Eddie McGuire.

TICKY FULLERTON: He is.

WAYNE JACKSON: Um, well --

If he is, I don't see why that is --

Was it a conflict before Eddie became president, or before Nine got the rights, or is it only a conflict since Eddie became president of the Collingwood Football Club and that Channel Nine have got part of our broadcasting rights?

TICKY FULLERTON: I think the potential conflict lies with Eddie McGuire being the face of Channel Nine, and that it was a very competitive situation for those TV rights between Seven on the one hand, and Nine and Foxtel on the other.

WAYNE JACKSON: Well, I think if there's a concern about conflicts of interest with Eddie and Channel Nine, that's an issue for Channel Nine and for Eddie.

TICKY FULLERTON: And for you.

WAYNE JACKSON: Well, I'm not sure it is for us, because Eddie has made an enormous difference to the Collingwood Football Club.

He's passionate, he's very energetic, works hard for Australian football, and harder, just as hard for the Collingwood footy club.

I'm not sure where the AFL is at threat.

TICKY FULLERTON: There's no suggestion of improper dealing over the TV rights deal.

EDDIE MCGUIRE: The big man goes inside 50, and Rogers out on the lead!

Second go at it.

Burns slaps it away.

Here's Clement.

Does the don't argue to Cracker.

Collingwood through Licurio get it out to Buckley on centre wing.

Richmond fans booing the Collingwood champion as he kicks forward with the left boot --

TICKY FULLERTON: With Eddie, it's hard to know where passion ends and self-promotion and cross-promotion begins.

So what is your grand plan going forward?

EDDIE MCGUIRE: World domination for Collingwood!

TICKY FULLERTON: Conflicts aside, the AFL's TV rights deal may not be repeated.

In Britain, a TV sponsor's collapse is sending soccer clubs to the wall.

DAVID WHITE, GENERAL MANAGER, SPORT, NETWORK TEN: We've seen Kirsch recut their Formula One deal.

We've seen the NBA have to recut their deal with ESPN and NBC in the US.

Um, over-the-top sports rights cannot be sustained, and that's what we've seen internationally.

TICKY FULLERTON: So is football's financial future -- its ability to prop up clubs -- really secure?

Four Corners put some projections to the AFL for the year 2006 based on AFL funding of increases in player payments slowing when the players' agreement ends next year.

Player payments rise to about $97 million, development doubling to $32 million, financial assistance at $3 million, players' association at $5 million.

That's close to $140 million a year.

You're going to need all that $100 million TV rights money, aren't you, by then?

WAYNE JACKSON: Well, I don't do the sums on the back of an envelope.

Er, we know the sums and exactly what the numbers are.

TICKY FULLERTON: Wayne Jackson says the escalation in costs over the last five years, driven partly by player payments, will taper off.

WAYNE JACKSON: The AFL is budgeting for a 3 per cent to 4 per cent increase in operating costs over the next four or five years, and that includes any consideration of player payments.

TICKY FULLERTON: But player rep Brendon Gale told Four Corners that players would not be locked into a 4 per cent rise, and they were restless.

BRENDON GALE: As a proportion of total competition revenue, the AFL players' salaries have remained pretty much the same at about 23 per cent, 24 per cent.

So, um, you know, that's still well behind, you know, northern colleagues in rugby league and cricket, etc.

TICKY FULLERTON: Do you think the new TV revenue is going to be enough to cope with increasing player payments, rising distributions and increasing support?

PETER JACKSON: Um, no.

No, I don't.

Um, I just think as football becomes more professional, the normal industrial issues and the normal commercial issues that are affecting every other business out there in the business community are going to start affecting football clubs.

TICKY FULLERTON: The challenge now for the AFL is to grow the game without risking its most precious asset -- those dyed in their colours -- because nothing beats being in the stands.

NEWSREEL: A crowd of 40,000 packed St Kilda stands to see Fitzroy and Richmond in the Australian Rules 1944 grand final.

Richmond supporters think the Tigers will eat Fitzroy, but tell that to the Maroons!

BRUCE DAWE, POET: In 1944, I went with my brother, and, of course, Fitzroy had a great year.

It was their one great year.

It was like their one day of the year for all time.

And a lot of the stars were the stars that, in my view, will never fade.

And the whole focus was on the players, and on that particular day.

You were merely an acolyte at a sort of religious festival.

Your performance was only to -- in your heart and soul, as it were -- to, er, to watch the team, and to hope -- against hope in the case of Fitzroy, in many games -- that they would turn out winners.

TICKY FULLERTON: But Fitzroy is gone.

So does loyalty matter anymore?

Indeed, does footy really matter like it used to?

EDDIE MCGUIRE: Oh, absolutely.

RICHARD COLLESS: Absolutely.

ALLEN AYLETT: My word.

It matters.

BRENDON GALE: When I was young, football was like magic.

Like a lot of things were, it was like a faraway magic land, and I guess when you're caught up in the system, you see it for the industry --

..you see it for the industry it is.

You see the victims go by the wayside, but you see, you know, the triumphs, and the great players, the great clubs come and go.

I mean, it still does matter, there's no doubt about that.

TICKY FULLERTON: For the Richmond hordes at Punt Road and Collingwood heathens from Victoria Park, their game is secure.

But the future for Bulldogs and Kangaroos may be running out for the good of the game, which puts passion second.

�2004 ABC

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