Seven and Foxtel are at a critical juncture in their financial and audience growth plans with both hitching their future to sports rights and, in the case of Foxtel, a new regime of exclusive live AFL game coverage in the “Super Saturday” rounds that it is banking on triggering a surge in Kayo streaming subscriptions, audiences and advertising revenues. And a march on Seven.

Seven CEO Jeff Howard was upbeat in earnings calls last week with analysts predicting its new AFL digital rights this year would trigger record sign-ups to 7plus and knock-on viewing increases to other content on its platform using AI and personalisation to land with individual viewing preferences.

Seven’s tearaway summer coverage of the cricket signalled what Howard said was to come in its new AFL deal which expanded its’ digital distribution – near 60 per cent of new 7plus users who signed-up for the cricket went on to consume other content on 7plus.

“We had 350,000 new registered users come on to 7plus to watch the cricket and 200,000 of those, roughly, have hung around and consumed non-sport content,” Howard told Mi3. Seven was focused on high value audiences and "that’s why we’re focused on sport and 7plus." 

Yesterday Foxtel Group CEO Patrick Delany fired a shot across Seven’s bow telling the Fox Footy launch crowd that "95 per cent of sport viewing was live" and “if you’re not live, you’re nothing” – live linear and streaming feeds were central to audience and subscription gains, he said.  

It was one of several competitive barbs thrown at Seven yesterday in the war games that are about to start in which the two media groups between them have to amortise $650m in rights costs this year alone. 

Under the new regime Foxtel and its sports streaming subscription service Kayo get exclusive live coverage of all AFL games on Saturdays in the AFL’s heartland of Victoria and Tasmania for the whole season and for the first 8-10 rounds for every other market. Foxtel also has its own production team for game coverage for the first rime - under the previous deal it took Seven’s feed and commentary.

Delany said Seven’s counter to Foxtel and Kayo’s exclusive Super Saturday live game coverage with VFL (Victorian Football League) games on Saturday night “is the  best marketing we’ve ever had. It’s certainly back to the future with Michael J Fox,” he told Mi3. “The last time I checked, the AFL was created in 1990 so to go back to before that is – I don’t know what the thinking is there.”   

Nine’s former sports boss and now Fox Sports Managing Director, Steve Crawley, said based on his experience with NRL rights between Foxtel and Nine, digital rights that did not have live streaming made no material contribution to audience gains.

Delany concurred, adding that audience growth was coming from a younger streaming set on Kayo, with sponsor demand high despite no ads being served during game play.

"Kayo is a young brand for young families and we're seeing the advertising shift. The advertising team have had extraordinary success." He forecast that to continue. "There's not a lot of sports supply and there's a lot of sports demand."

Delany told the launch crowd: “We’re not going to sleepwalk into a new era. This is a new era for the AFL, there's a new soundtrack with our call, there's a new look and feel. All of the shows are refreshed. This is going to be absolutely extraordinary. It will be a massive game changer.”

Foxtel Media CEO, Mark Frain, said the AFL would be the "fastest growing piece of content we've got” in advertising terms because of changes in rights.

“So not only will the increase in total revenue be significant and the increase in revenues on Kayo because of its growth, the biggest thing that we'll see this year for Foxtel Media is growth of a whole bunch of brands, particularly out of the Victorian market that have always gone by default to Seven," per Frain.

"They've had those games on Saturday and on the weekend. Now we've got significant scale in the Victoria market with exclusivity. By the end of the season, we probably would have picked up 50 to 100 brands that have never been on the platform, which sounds ridiculous given how long we've had the AFL, but that's how significant it is on that weekend.”

Frain said Foxtel Media had a “record breaking start” in the number of partners and “how much they spend” weeks out from the season start but a “phase two is to come when the Victorian population starts waking up to the changes".

"Kayo marketing is just starting," he said. "I don't think all of the advertising market has fully woken up to that change either. So while the big corporate brands that have been partners of the AFL for a long time are there early and voting with their wallets, the next wave of all those new brands will come in the first couple of weeks of the season kicking off.”

Which suggests his sales team will have some sizeable new targets.

On the customer side, Delany would not be drawn on audience or subscription growth forecasts – the closest to any outlook was an increase in advertising impressions on Kayo which Frain said would probably be “just shy of 100 per cent”.