Thin end of the ownership wedge

There is disturbing news today that NRL’s Newcastle Knights appear set to be taken over by mining magnate Nathan Tinkler. Tinkler recently came to an arrangement with A-League’s Newcastle Jets.

AussieRulesBlog knows nothing of Tinkler beyond what we’ve read. We make no suggestion that he will do anything untoward in his stewardship of these sporting organisations.

Nevertheless, private ownership of sports teams in Australia has a chequered history. Most infamously, Christopher Skase owned the Brisbane Bears AFL licence, with a succession of owners following until the club was eventually restructured to provide for a traditional membership structure.

Only a few years ago, North Melbourne managed to find a way out of its corporate ownership tangle and back to traditional membership.

More recently, there have been issues between supporters of A-League’s Gold Coast United and backer, “billionaire” chairman Clive Palmer. Reports in 2009 that Palmer would withdraw funding suggested the team would fold without Palmer’s money.

And who can forget the self-serving efforts of News executives in and around Melbourne Storm’s salary cap debacle?

Even in that bastion of capitalism, the United States, private ownership of sporting teams hasn’t always been the happiest of scenarios. A recent, well-publicised radio rant against the Washington Redskins being an example.

Recently-installed owners of EPL teams have been having their impact with managers being shown the door — admittedly not all that unusual in EPL.

Let’s be clear that in some cases, such as North Melbourne, the club would not now exist without wealthy individuals having put their hands into their very deep (and full!) pockets. Many Fitzroy traditionalists would have welcomed a corporate saviour rather than embrace the ‘merger’ with Brisbane.

In the Australian context — about 22 million people scattered around the edges of a huge island continent — economies of micro-scale and trials of geography mean that it’s difficult, at best, for sporting clubs to break even.

For some teams, like the Sydney Swans, Brisbane Lions and Melbourne Storm, isolated in enemy code territory, a financial drip is a necessity.

For others, playing to often bare stadiums in the NRL, poker machines provide a financial lifeline.

There may be, perhaps, a dozen clubs around the country that could be classified as self-sufficient, all things being equal.

And it’s the “all things being equal” rider that brings the spotlight back to private ownership.

If a private owner, or “backer”, falls upon hard times (and how hard is that in this globalised world?), then teams fold and the very viability of leagues is credibly called into question.

Will David Gallop now be considering Nathan Tinkler, Russell Crowe and their business interests in NRL decisions, or will the good of the game win out.

Thank goodness, AussieRulesBlog’s Aussie rules is as financially strong as it is, without the necessity for private money.