Channel 7 have made an unexpected move to improve their bargaining position against Cricket Australia.
Channel 7 have made an unexpected move to improve their bargaining position against Cricket Australia.

Channel 7 raises the stakes with shock $10m payment

Channel 7 has made a shock $10 million payment to Cricket Australia, in a move designed to ensure their hands are clean before a crucial D-Day in the dispute next week.

Two weeks ago the network chose to only part-pay on their $25 million TV rights instalment in what was effectively a statement that they deemed the new total worth of the entire COVID-19-hit summer to be more in the vicinity of $15 million.

But News Corp understands Channel 7 on Wednesday paid the full amount of what was owed to safeguard them against an obvious breach of their contract, as they prepare to head to a tribunal as early as next Tuesday for an arbitrator to make an independent assessment on the value of the rights.

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Channel 7 commenced termination proceedings nearly three weeks ago after accusing Cricket Australia of multiple contract breaches over the proposed schedule.

Not wanting to put a free bullet in CA's chamber, the network now wants to remove its own clear breach of contract in being short $10 million from the record before taking the dispute to the Australian Chamber for International and Commercial Arbitration.

It's the clearest sign yet that Channel 7 are determined to get out of their existing $450 million six-year deal, and aren't simply in for a COVID-year discount.

Cricket Australia has already shown they're prepared to negotiate by offering Channel 7 a discount at a meeting the week before last, but despite the good will and some positive developments with the schedule, the two parties still appear a long way from agreement.

CA is aware of Seven's intentions and have been treading carefully at every turn, not wanting to expose themselves to the possibility of a breach.

Cricket Australia has maintained all along they have not breached the contract and say their conversations with Channel 7 remain ongoing and constructive.

Channel 7 sources say the tribunal will determine what the rights are effectively worth, and that their determination is binding.

CA interim chief executive Nick Hockley and Channel 7 boss James Warburton have had some constructive meetings and CA has been able to rectify a couple of the broadcasters' complaints.

The cancellation of three one-day matches against New Zealand in late January gives the Big Bash League a free and uninterrupted window leading into the finals where all the big-name Australian stars can be available, and goes some way to appeasing Seven and Fox's concerns over talent.

Fox Sports also did not make a full payment on the $33 million they owed a fortnight ago, but it's understood they are moving towards a satisfying resolution with Cricket Australia over value.

The networks are concerned about Cricket Australia's COVID-forced plans to stage the BBL in hubs where matches will be played at neutral venues, but CA they will still produce a world-class product.

Originally published as Channel 7 raise stakes with shock $10m payment