SA Rugby World Cup bid: Dirty, sexy, rugby

Come June, SA Rugby will need to come up with guarantees of R3 billion for an event to be staged in 2015 and 2019. And a strategic plan of note.

This is the same organisation that if you pop along to their site you will see they are operating off a 2003 and 2005 plan for this year.

How are they going to marshal a plan, money and the competency to do this in six months with a Super 14 four month schedule from February to May and a British and Irish Lions tour in June and July, followed by Tri-Nations in July and August?

They will also need to partner with the South African government and especially Sports Minister Makhenkesi Stofile with whom they have been at loggerheads, over not delivering a sixth Super 14 franchise to the Eastern Cape and of late the Springbok emblem furore that will not die.

These are two lightning rods with unresolved issues and dynamics that have perilous financial implications for SA Rugby and now they need to raise R3 billion plus by June on the heels of the financial collapse of their major sponsor Canterbury that has cost SA Rugby tens of millions of rands and hundreds of thousands of rands for the Lions, Sharks and Cheetahs, plus the Sevens team in Wellington and the FNB Varsity Cup.

This did not suddenly happen to the extent that it was a shock to SA Rugby. They were aware of Canterbury’s financial frailty in May 2005 already and did nothing about it.

Here then is a quick snapshot of the state of the game in the Southern Hemisphere.

Six weeks ago the International Rugby Board (IRB) announced a new tournament fee structure for the Rugby World Cup 2015 and 2019 bidders in order to give an added boost to the competitiveness of the process. A discount if you will to bidding nations in the parlance of retailers.

The decision was made to reflect the current economic environment and subsequent feedback from the nine member unions who are tendering to host these tournaments.

So follow the logic and rationale here.

IRB chairperson Bernard Lapasset said: “A recent independent Deloitte report on the economic benefits of hosting the Rugby World Cup highlighted the fact that it is one of, if not the most, cost-effective major sports events in the world. The Rugby World Cup is estimated to have the potential to generate up to R32 billion in economic benefits while capital expenditure costs are among the lowest for an event of this magnitude.

“These economic benefits make the tournament a major attraction to host. Of course an event as large as Rugby World Cup does require a certain level of financial underwriting upfront. We have been in constant touch with the nine tender unions and have taken on board their comments on the current economic environment they are operating in.

“We have also had meetings with government officials from several of the potential host countries, which have been very encouraging. However, in light of the current economic environment the IRB has decided to take a pragmatic approach on the tournament financial modelling to assist unions in their future discussions with their respective governments and their delivery of competitive tenders.

“The IRB council has agreed that the minimum tournament fee for 2015 be reduced to £80 million (about R1.16 billion) from £100 million and that the minimum tournament fee for 2019 be reduced to £96 million from £120 million. The IRB has also agreed to incentivise the host unions by building in a profit share formula for any tournament surplus it generates that exceeds the minimum guarantee.

“We are still looking to achieve a tournament fee of £100 million from 2015 and £120 million from 2019. The revised minimum requirements are just that, minimums. There is nothing to prevent one union bidding the minimum guarantee of £80 million for 2015 and another bidding £100 million. That would lead to a very interesting decision-making process next year when the host unions for Rugby World Cup 2015 and 2019 will be decided in July.”

On the Pacific Rim we have the Japanese Rugby Union, which has had its eye on the 2011 Rugby World Cup, feeling that they were robbed at the last minute and now the 2015 one too.

Just this week the Australian Rugby Union (ARU) and the New Zealand Rugby Union announced they were pulling their Australia A and Maori teams out of the Pacific Nations Cup in 2009. Too expensive they say.

On top of that the ARU announced that it would suspend the 2009 Australian Rugby Shield, a round-robin tournament involving teams from Victoria, South Australia, Northern Territory, New South Wales Country and Queensland Country.

The New Zealand Rugby Union (NZRU) also anounced it would scrap minor competitions and there would be no matches for New Zealand Maori or the Heartland 15 this year.

They’ve prioritised the junior All Blacks, but long term see the New Zealand Maori as the best fit for the Pacific five nation tournament in the future.

The New Zealand Rugby Union is trying to reduce its spending on its national teams programme, reign in spending when it assembles the All Blacks, the women’s team, age group and development programmes.

Among the changes is the end of the men’s competition involving the B sides of the 14 Air New Zealand Cup provinces.

The announcement comes after December’s unveiling of additional funding for the 26 provincial NZRU unions.

And what plans for the 14 SA Rugby Unions? Five franchises or six franchises? Super 14 or Super 15?

Regan Hoskins announced in December, “The on-going process of simplifying our structures to make us more responsive to the needs of rugby also continued at speed in 2008 as we moved closer to combining the amateur (Saru) and professional (SA Rugby) arms of the organisation back into one entity.

“The state of rugby in the Eastern Cape also remains high on our agenda and, in the new year, we will be announcing the outcomes of our latest discussions on the most effective route to deliver Super Rugby to the region.”

Could this be true? If so, SA Rugby would be taking the lead with proactive measures in resolving this tournament fixture and economic meltdown the Southern Hemisphere rugby unions are going to be facing.

If not, more propaganda mongering to soothe the Minister of Sport and obtain the South African governments commitment to support their Rugby World Cup Bid, and placate the displaced, disadvantaged and decrepit Eastern Cape rugby unions who are in this parlous state only because they have no Super Rugby franchise.

In Japan, the national team, the Cherry Blossoms, are without doubt the Asian super powers and with the foreign coaching and playing influence, they are improving at each Rugby World Cup.

Yet, for many world rugby followers, Japanese rugby remains an unknown quantity; an enigma.

Participation in Japan is on the increase, with more than 140 universities playing rugby as a key sport. The top 80 rugby universities in the country have established their rugby programmes based on the US system and the resources at their disposal are unbelievable.

No expense is spared, with 80 to 150 players per programme, all housed in dormitories usually based around the sporting facilities of gyms, athletic tracks, synthetic and turf playing fields.

The company teams run hybrid versions of the university programmes specific to the companies’ strengths and resources. Company rugby teams range from amateur to fully professional and the numbers of players range from 43 to 65 per programme.

Once again, they are housed in dormitories and apartments, specific to the training facilities. The facilities at the Japanese companies’ disposal are superior to the Australian Super 14 franchises.

Companies play rugby as their key sport for a number of reasons including prestige, company worker healthcare, and most importantly, local and global business relationships.

A lot is expected of a foreign player and coach entering a company, as they have been hired for their intellectual property and, most importantly, on-field results.

As rugby in Japan becomes more competitive, the days of foreign players coming to Japan to increase their pension plan, relax and take in the culture are long gone.

A common mistake foreign coaches and players make is in attempting to transplant what they did on their home turf, rather than consider the unique nature and strengths existing in the company programme. The key to success for foreign players/coaches is dovetailing world and Japanese rugby methods and cultures.

Japanese rugby has its weakness and strengths, but basically it’s just different, and this must be accepted before headway can be made.

Japanese rugby has real strengths, which if tapped into, will accelerate rugby in the country on an international level.

Although generally the players are smaller than the top playing nations, they are super strong. The agility and reactive speed of the players is sensational and the body height superior. The passing and kicking skill sets is generally great and the player’s work ethic is fantastic.

While Japanese rugby learns from the rest of the world, the rest of the world could pick up a thing or two from Japan, which is why the Australian Rugby Union’s O’Neill is making cooing sounds in favour of including Japan in the Super 14.

Japan is a rugby market that is waiting to explode and they have the power, resources and planning to make it happen.

The Australian Rugby Union has woken to this powerhouse and has the intention to promote and tap into the Japanese rugby market as it is potentially massive and will be extremely profitable for all world rugby.

Expect a co-bid then from Japan and the Australian Rugby Union for the 2015 and 2019 Rugby World Cup respectively.

This is not about rugby any more, this is about alliances and unlocking new sponsors to grow the game.

What strategic alliances and sponsorship plans do SA Rugby have that we do not know of?