New Zealand braces for big hit in Rugby World Cup revenue 09/09/2009 |
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Organisers of the 2011 World Cup may face larger than expected losses but it was still too early to tell, tournament chief executive Martin Snedden said on Tuesday.
The host union is only allowed to keep ticket revenue with the International Rugby Board (IRB) retaining all commercially generated income as well as a NZ$150 million (63.2 million pounds) hosting fee.
The 2011 tournament was initially projected to suffer a NZ$30 million operating loss but the global recession and uncertainty surrounding ticket revenue meant that figure may increase once the budget process was completed.
With two years remaining before the tournament kicks off in Auckland, local media have reported the loss, to be underwritten by the government and New Zealand Rugby Union, could increase to NZ$40 million.
"We are not in a position to confirm that yet," Snedden told Reuters in a telephone interview from Auckland, where he added that organisers were still working through the budget.
"Where we are a bit exposed is on the revenue side. We are trying to make our best guess-estimate as to where that will fit.
"We are keeping a very conservative approach to our ticket revenue. It may mean that once we finalise this it might be a little bit lower than we started out."
Snedden said the major uncertainty in revenue was the projected take-up of tickets by New Zealanders, with about one third of the games being earmarked as premium and being set at "international prices."
UNKNOWN TERRITORY
Ticket prices for those games would be similar to those in France in 2007, with the average cost ranging from NZ$350 for the quarter-finals to NZ$800 for the final.
"The remaining 33 matches will be charged at high All Blacks test prices down to Super 14 prices," Snedden said.
The amount of tickets available was also a challenge with the previous highest revenue being about NZ$32 million from the British and Irish Lions tour in 2005.
Organisers projected ticket revenue from the 48 matches for the September 9-October 23 tournament at NZ$280 million.
"We really are in unknown territory."
While pricing and packages still needed to be approved by the IRB, Snedden said that organisers would allow fans to pay for ticket packages over six months at no interest.
Snedden, who was hosting IRB president Bernard Lapasset and chief executive Mike Miller in Auckland, said apart from the ticketing strategy and budget still being finalised all other aspects of the tournament were "tracking along nicely."
"I've just spent the day at Eden Park showing the IRB guys around, and that was a really good way to start their visit.
"Three years ago, Eden Park and rugby World Cup was a contentious issue," he added of the debate surrounding the NZ$240 million redevelopment of the stadium that will host the final.
"Now, it's two months ahead of schedule, it's on budget and is looking really impressive and so to be able to show these guys around today was just fantastic." The New Zealand government will host a function in Wellington on Wednesday to commemorate the two-year countdown mark.
(Source: Reuters)
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