Statement on Behalf of the Four Welsh Regions from RRW

[Peat]

The thing is, sports clubs aren't really businesses. A business' main aim is to turn a profit. A sports club's main aim is to produce on the field. A profit is nice, but it's not the main objectives. The most successful sports sides usually aren't the most successful business models by any stretch.

That's only true to a point.

Yes, the main aim for a sports club is on field production.

But everything they need for that, sooner or later, costs money.

Which means you really x 10000000 want a business as well.

You don't have to have one. Subsidies from various sources can substitute. But even in those circumstances, you still want a combination of the two and you still want that business side to be as strong as possible. The more money a club receives, the more it can invest in players, in facilities, in staff and so on. And increasingly, the clubs with good business models are dominating. Not always, but off field resources count heavily in sporting success, and barring serious subsidy that means good business models.

Which brings us to stadiums. There are four main sources of income available to a rugby club; tickets, merchandise, tv and competition monies, and sponsorship. A club that owns its own stadium has a fifth; renting out the stadium for non match-day purposes. Corporate hospitality, parties, weddings - I've heard of people doing law exams at Selhurst Park - anything - anything that makes a profit. It's a very worthwhile income stream and long term, clubs with their own stadiums will outstrip those without all other factors being equal. If Ospreys and Cardiff can't make money that way, it is that bit more an uphill struggle. The Welsh Regions' big problem is they don't even have the money to compete equally at the Pro 12 table, nevermind the European one, and that lack of success only leads to less money. It's a vicious circle and something big is needed to jolt it. The obvious solution is WRU funding but they clearly don't want to give it unless they control everything.

Which might work out ok. I'd point out that Ulster's recent revival has been hugely about what's been done off the pitch - Humphreys has done nothing on the coaching field but witness the ripples caused by his move - and Ulster is of course, union run. Up until Humphreys and Logan that did however mean blazers, of which I've heard little good. It's telling that Humphreys and Logan have business experience outside of rugby and you'd hope that the WRU would follow a similar model. Because at the end of the day, it doesn't matter which body precisely is at the top as long as they send competent people in to do the stuff at the sharp end.

 

[Thingimubob]

Eh? How could this happen? The regions are obliged to release their internationals during the windows.

Ah I misinterpreted the BBC article, just that 4th test vs SA plus the two week pre AI training camp will be affected. Although apparently they'll be able to block release for 7s too, though I think the IRB are moving to make sure clubs can't do that soon at least.

 

[smartcooky]

Eh? How could this happen? The regions are obliged to release their internationals during the windows.

Ah I misinterpreted the BBC article, just that 4th test vs SA plus the two week pre AI training camp will be affected. Although apparently they'll be able to block release for 7s too, though I think the IRB are moving to make sure clubs can't do that soon at least.

There are no quick fixes for this problem with the Regions, only sticking plasters.

If the WRU take a long term view (and really, that is what they must do) then it may not be a matter of whether the players get released so much as whether they will be even selected. The WRU could also take a compromise view, and make players with existing Regions contracts eligible, but any new or renewed contracts would not be, and could not play for Wales.

 

[Amiga500]

My take is - long term there is only one solution.

The professional clubs* being wholly owned subsidiaries of the WRU.

- It removes all financial dealings from the public eye and brings it in-house.
- Academies then can be directly run by the WRU, or for the WRU by coaches appointed by the WRU senior coaching team (i.e. Gatland at the min).
- The entire Welsh professional structure can implement a style of play as determined by the senior coaching team (Gatland).
- Folks may be more likely to turn out to support the teams, as they aren't really the opposition club, but a WRU representative side.
- The WRU may be better placed to stop the drain to France/England.


I know this is painful for some. I know there are those that despise the WRU (some/many may even have good reason). I know there are those that despise Roger Lewis. I know the owners of the regions have put sizable amounts of money into the game and are facing it being written off.

Its not a perfect solution for everyone, in fact, it may not even be the perfect solution for anyone. But the way I see it, its the only one that will work long term. So better to take the pain and get it over with.


*whether they are clubs or regions is irrelevant.
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[Peat]

It is interesting to note that the IRFU are now looking at the possibility of private investors. I believe the Kiwis are already taking some on board. All over the world, we are seeing some form of public-private relationship between unions and clubs.

Are the WRU bent on swimming against that tide and in doing in a manner that will poison the well against all attempts to reverse it? If they are, it smells like a mistake. Maybe they merely play hardball on what they give the regions in exchange for what. I don't know. Regardless, I feel a bit of caution must be taken in regarding a WRU controlled endgame as a good thing.

 

[Feicarsinn]

It is interesting to note that the IRFU are now looking at the possibility of private investors. I believe the Kiwis are already taking some on board. All over the world, we are seeing some form of public-private relationship between unions and clubs.

Are the WRU bent on swimming against that tide and in doing in a manner that will poison the well against all attempts to reverse it? If they are, it smells like a mistake. Maybe they merely play hardball on what they give the regions in exchange for what. I don't know. Regardless, I feel a bit of caution must be taken in regarding a WRU controlled endgame as a good thing.

Sauce?

It'll be interesting to see what kind of model the IRFU come up with. It's apparent to everyone that they need a bit more cash to compete with the French and ensure we don't end up with more situations like the Sexton farce. The provincial model has been very successful historically however, so they should be very cautious in altering it.

Could they look at taking private donations, similar to the way the FAI had Denis O'Brien provide a lot of funding for Trap's contract? It's hardly a reliable model, but it could provide a little extra dosh to keep the likes of Healy and O'Brien on board, meaning the IRFU could spend on a few higher quality foreign targets for the provinces.

 

[Peat]

Sauce?

It'll be interesting to see what kind of model the IRFU come up with. It's apparent to everyone that they need a bit more cash to compete with the French and ensure we don't end up with more situations like the Sexton farce. The provincial model has been very successful historically however, so they should be very cautious in altering it.

Could they look at taking private donations, similar to the way the FAI had Denis O'Brien provide a lot of funding for Trap's contract? It's hardly a reliable model, but it could provide a little extra dosh to keep the likes of Healy and O'Brien on board, meaning the IRFU could spend on a few higher quality foreign targets for the provinces.

http://www.espn.co.uk/ireland/rugby/story/234253.html

I suspect by private money, they mean they want guys like the Irish financier who put up a lot of funding for the Leinster academy (forgot the name, was mention in the PR Irish thread) in return for nought but a warm glow, which I'm guessing is what you mean by the O'Brien reference... but I imagine they'll examine the possibility of businesses taking up private stakes in one of the Provinces, providing they remain in control.

Of course, such a thing is a long way away from the Welsh situation, but who's gonna be lining up to give the WRU money after this?

 

[Amiga500]

Terrible terrible idea if true.

Whoever* suggested it should be taken out to the front door, kicked out through it and never let darken it again. Maybe even shot in the knees so they don't forget to ever be so stupid again.


Investors will look their pound of flesh at the end of the day... which invariably means money. Which will suck more out of the game long term.

If you want to get donations, then fine. But it comes with no control over province/national side whatsoever, the arrangement is otherwise known as "sponsorship".


Thats it. Thats the line. Draw it and don't dare move it. Otherwise you are just courting short term gain for long term drain.


*no doubt a bright idea by one of those r€tards in the financial sector that "know" money.

 

[munstermuffin]

Can I just add in something I've said few weeks ago and it's from insiders. The finances of IRFU are at a bad state so they'll need support and it's now finding balance of releasing ownership of provinces somewhat but maintaining 100% control and possession of players

 

[Feicarsinn]

Can I just add in something I've said few weeks ago and it's from insiders. The finances of IRFU are at a bad state so they'll need support and it's now finding balance of releasing ownership of provinces somewhat but maintaining 100% control and possession of players

You've said this before, but I'm still skeptical. They just posted a €7.3 million surplus for the year, which is far from a bad return.

 

[munstermuffin]

You've said this before, but I'm still skeptical. They just posted a â'¬7.3 million surplus for the year, which is far from a bad return.

It is but they've to contribute for redeveloping RDS and as I said funds. Im not saying it's horrific but between needing the funding to stay competitive in Europe and pay for off field stuff like redevelopments etc. but we do need to still be all very competitive in Europe as Pro12 alone won't be enough

 

[Feicarsinn]

Back on topic, the regions are nuts: http://www.espn.co.uk/wales/rugby/story/234091.html

 

[TRF_Olyy]

Of those eight players, two can be players who are serving the required three-year residency spell in the country with a view to playing for Wales in the future.

I didn't realise Wales had started the whole project player thing, too.
Gross.

6-8 Welsh players per 23 is not...ideal. Especially considering there's just four regions. I mean you put 6 Welshmen in each region, in a round, and that barely covers a matchday 23 for Wales.
I think in the Aviva the worst side for English players was Worcester, and they averaged over 9 over the season, if I remember the article I read correctly.

 

[psychic duck]

I didn't realise Wales had started the whole project player thing, too.
Gross.

6-8 Welsh players per 23 is not...ideal. Especially considering there's just four regions. I mean you put 6 Welshmen in each region, in a round, and that barely covers a matchday 23 for Wales.
I think in the Aviva the worst side for English players was Worcester, and they averaged over 9 over the season, if I remember the article I read correctly.

Ignore that article, it's actually misleading sensationalising reporting ignoring details most likely copied from the Western Fail's take. What was actually the case was that the regions wanted a season long average of 6 rather than the current fixed cap of 6, with 10 allowed in the overall squad.

So in theory, they could field a side with 5 Welsh players in a game, but in practice highly unlikely.

 

[TRF_Olyy]

A season long average is worse, though, surely?
It means you could, in theory, have some games with 23 foreigners, as long as you have the same amount of games with 12 Welshmen in?

 

[Bluemoon]

It seemed like the regions were rushed in every sense and not thought through properly.

Welsh fans are always quick to blame the pro 12 for everything too.

Agree with this 100%. The regions were poorly designed and researched. Some of the original mergers looked great, but it was difficult to decide who would fund it, especially as Wales were skint at the time. It certainly missed the idea to represent all the major rugby areas in Wales, with a finically viable structure. We needed less teams than we had, but the teams and structure were dictated by the money men.

We know the WRU cannot afford the running and maintenance of 4 regions. I don't think the boards wouldn't actually allow it anyway, considering how much influence they had during the regional inception. Hopefully an agreement will be made which involve dual contracts and hopefully that will be enough to keep more of the Welsh players in Wales and allow the squads to strengthen enough through the local academies and NWQ players to compete. Dual contracts seem fair, I know Warburton and Penny missed most of the Blues season this year following duty with Wales.

As to the second part of that quote, I'll agree that some Welsh fans may think that, but there are a lot of regional fans who support the Pro 12. This forum is awful for this boring argument. Most of us understand there are a lot of factors to this complicated financial situation we find ourselves in, rather than blame it on the domestic league we play in.

 

[Peat]

A season long average is worse, though, surely?
It means you could, in theory, have some games with 23 foreigners, as long as you have the same amount of games with 12 Welshmen in?

We have EQP quotas in the Premiership calculated by season average - hit them and you gain more funding. All EQP 23s in dead rubbers and forlorn hopes from clubs that elsewise would never dream of such a thing are not unknown. Would that happen with the Welsh? That is a probability up there with ursine arboreal defecation.

One can see the logic to a point - if they can't keep the best Welsh players at home, the player production base is too narrow to provide four competitive regions where one has a hope of winning. The obvious answer is widen the base by allowing more non-Welsh players. But to that extent? That seems pretty radical.

Re Amiga's post - the clear and reasonable worry is that without short-term gain, competition from the French clubs will see the long-term drain start tomorrow. That's a worry for everyone around the globe and everyone is taking steps. I also think it's reasonable to hope that short-term gain can create a bigger pie and ensure there the Regions get more regardless of repaying the investors, I mean it's the main reason people take on investors after all. the idea deserves more consideration than it is given.

And that goes double for the Welsh, who need a big gain just to regain their best players and establish a contest their fans want to watch.

 

[TRF_Olyy]

We have EQP quotas in the Premiership calculated by season average - hit them and you gain more funding. All EQP 23s in dead rubbers and forlorn hopes from clubs that elsewise would never dream of such a thing are not unknown. Would that happen with the Welsh? That is a probability up there with ursine arboreal defecation.

True, but they were initially set at 12 and rise incrementally (can't remember if last season was 13 or 14) - a bit different from 6.

 

[smartcooky]

It is interesting to note that the IRFU are now looking at the possibility of private investors. I believe the Kiwis are already taking some on board. All over the world, we are seeing some form of public-private relationship between unions and clubs.

In our case, the NZRU will be retaining no less than 51% ownership of each Super Rugby franchise, and will have the only say on player release.

 

[psychic duck]

A season long average is worse, though, surely?
It means you could, in theory, have some games with 23 foreigners, as long as you have the same amount of games with 12 Welshmen in?

No, because the squad limit was 10. If a side played 10 NWQ players in 1 game they would have to play 2 in another to compensate, in reality it's more to do with allowing players to be drafted in for a better side in international periods rather than a glorified Principality Premiership/Academy one. And to be honest, I'm not really bothered by NWQ players, would rather see Faletau have a passable front 5 with SA mercenaries than one with Welsh players barely deserving of a pro contract.