Culture, Communications, Welsh Language, Sport, and International Relations Committee

Good morning. Welcome back. We're moving straight on, now, to item 3. We're still considering the six nations rugby broadcasting rights, and now we're having an evidence session with other stakeholders. I'll ask the witnesses to introduce themselves for the record. I'll go to the room first. I'll turn to Huw, first of all.

Huw Llywelyn Davies, former broadcaster on the game and involved in the game now at grass-roots level. I'm president of Pentyrch rugby club in this area.

Thank you very much. Dave.

I'm Dave Chapman, the executive director for UKHospitality in Wales—that's the trade association for all of the hospitality industry, really.

Thank you so much. Diolch yn fawr. Richard.

Good morning. My name's Professor Richard Haynes. I'm a professor of media and sport at the University of Stirling in Scotland.

Thank you.

And finally, Seimon.

Good morning. I'm Seimon Williams. I'm here as a blogger on rugby and the author of the book Welsh Rugby: What Went Wrong?.

Thank you very much. As I said, you don't all have to come in on every question, but do raise your hand if you do want to respond.

I'll begin by asking how you think the market in terms of sports rights has changed since the current listed events regime was introduced. How have things developed over the years in the market itself?

I don't quite understand the question, sorry.

In terms of how the sports rights market has changed, if there's more—. Well, I don't want to ask a leading question, but how has the ecosystem changed in terms of—? I'm trying to think about how to word this in Welsh.

How the ecosystem has developed since the listed events regime was first introduced.

If that makes sense.

From the point of view of rugby in Wales?

Yes, in terms of any pressures that there are, or any changes.

In the early days, of course, it was only free-to-air broadcasting that was available, because the two channels, BBC and ITV, were the players at the time, and the dynamic has changed entirely since then with numerous companies now that must be paid for. That means, I think, that there are fewer people watching rugby on television and that has a detrimental impact on the game in Wales, because there is a link between the number watching on television and the number who play and participate in the game. The evidence from cricket, for example, demonstrates that, since the BBC lost the rights to that and it went to Sky, there are fewer people, and fewer young people in particular, playing cricket. So, there is a link between the two, I think.

Thanks for that.

I think that Professor Haynes wanted to come in. Richard.

Yes. So, historically, a form of listed events has existed since the 1950s, actually, although the legislation in 1996 kind of gave that belt and braces. And I suppose sports broadcasting for decades was considered to be a public good. It was non-exclusionary, it was non-rivalrous, everybody could watch it. But, today, of course, as has been mentioned, most sport—live sport, that is—is behind the paywall—what economists would call a 'club good'. So, unless you pay to be in the club, you don't get to see it.

One thing I'd say from 1996—. Obviously, Sky Sports began in the early 1990s and used sport, as Rupert Murdoch said, as its battering ram for a new era of television. And I think, in many ways, that equation continues. But one thing I think you'd say for audiences of sport is that that idea of paying for sport has been normalised. It's kind of common ground that if you want to watch the sport that you're interested in, then most likely you have to pay for it. But, of course, that raises lots of questions about ability to pay and so on and so forth, which we may get into later on.

Does anyone else want to come in? Seimon, yes.

Thank you, Chair. I just wanted to make a point, really, about the nature of how sports are being broadcast, and in terms of rugby, the provision is fractured, really. That is, there's no one place to find the games. So, if you want to watch the games that are free, they're on the BBC and S4C and so on, and ITV. But if you want to watch the United Rugby Championship, it's on Viaplay; if you want to watch England's club matches, they're on TNT; if you want to watch Wales on tour in the summer, they're on Sky; and if you want to watch Wales's autumn internationals, they're on Amazon. So, I think that's one of the problems, the fact that the provision is so fractured. Or if you want to see all the games, you have to take out many subscriptions with different providers.

There is a discussion, I think, in terms of the debate about the new deal. The six nations have been dealing with it with the autumn games and the summer games. In one way, that could make things easier for people to find the games if they're all in the same place, in terms of international games.

Thank you for that, Seimon.

Dave, how affordable are sports subscription packages for hospitality businesses in Wales?

At the moment nothing is affordable for our industry. We've got really difficult times persisting from March 2020 until now and a succession of serious hits from COVID through to inflation, energy and food and drink inflation. The latest inflation figures show, I think, 2.9 per cent, but 6 per cent food and drink inflation is within that. And the effect of all of the economic pressures on our customers means that we can't really lift prices to be able to accommodate the soaring costs that are coming underneath. The margins are squeezed everywhere and that means that at the very best at the moment most local pubs, for instance, are now finding livings, but they're not actually making much profit. They can't reinvest and they can't take steps that might be available to them to try to draw more customers in, such as taking out subscriptions if they're really that close.

First of all, there are specialist pubs that do that, and you'll be aware of that. There'll be sports bars and places that would want to bring in the type of customer that wants to see that and stays there for a number of hours watching a succession of games, perhaps. But local pubs don't tend to go that far and we're really not in a position to be able to extend the offer at the moment, just because things are really tight. And I should say at this point that, if there was any support and opportunity to be able to take business rates back to 75 per cent relief from where they were last year, from the 40 per cent that has now been put into the Welsh budget, in the few weeks that we've got between the draft and final budgets, the industry would be really appreciative of that, and it would make a huge difference over the coming year.

Thank you, Dave. Alun, you wanted to come in.

Can I say, I fully accept the point that you make about the difficulties facing the sector? We've all seen a decline, and I've been in more empty pubs recently than I've been in in my life before; it's very striking, the changes that are taking place at the moment. So, that makes sport more important. You've described—. I was reading this morning about people taking part in this dry January thing, which is alien to me, but it means that there is less public socialising, shall we say, and the rest of it. So, that makes sport, I would have anticipated, more important—so, that sort of event provision. I can't imagine that I'm alone in having watched a rugby match or a football match or something in a pub. It's a great social occasion and I would have thought that all hospitality venues, shall we say, would be looking towards a programme that includes, you know, we're talking about the six nations here, but we could be talking about other games as well, in the future.

It's very important—you're quite right. I think it's one of those occasions where I don't have to provide much empirical evidence to Members because you've all got your own experiences of how this works. And you're quite right to say, as well, that the community factor is probably as important to Welsh people as the perpetuation of the economic surroundings for their local pub—the chance to get together. There is a unique atmosphere in our pubs when these things happen. But I must come back to the economic factors. I haven't got any definitive research, but I've done some checking around with different businesses and I can give you some quotes that might highlight what you're saying, really: a single pub, a 70 per cent turnover improvement; 80 per cent in another one; one pub said that it's absolutely essential for them and it goes up 100 per cent when it happens. The 2019 figures that I've been given by members of the industry on the free-to-air competition was that there was a 40 per cent increase in beer sales during that, and the six nations have similar things.

I really do want to emphasise the importance of our industry as a special case for this, where we play a part in the culture, the community of Wales, in every single part of Wales, in every constituency in Wales. We are the third biggest industry in the UK, economically, but there are very few industries that touch every part of every nation in the way that we do, and help to create that. So, there is no doubt that, if it was free to air, there would be many, many of our establishments that would benefit. And, in the current environment—and I can't see the environment changing dramatically over night and there are always other things that could affect it over the coming time—it's the period between January and March that's really critical to pubs' survival. You will have seen—. I mean, we've got 10 per cent more pub closures than England in Wales. I think you will have seen the impacts of the current squeeze hitting, particularly in the early days of January and going forward, following the Christmas and new year season, which is traditionally a chance for us to get some money in and some protection for the year. It's this period now that is particularly relevant and that's when the key six nations comes in.

Thank you.

Let me play devil's advocate, because if, for example—. You've given the evidence that I think committee will accept without any issue at all. So, if the six nations, for example, goes behind a paywall and there are people who, for whatever reason, be it financial or other, aren't willing to pay for that, it might well be of benefit to some of your members, because we will have to go somewhere where it's being shown, somewhere public. So, you'd go down to a pub usually, wouldn't you, to go and watch, in the same way as, occasionally, I watch Premier League football on a pub tv, because I don't have—. I've just got the Cardiff City package, so if I want to go and watch any other game, I'd have to go to a pub to watch it, and I wouldn't necessarily make the choice to go to a pub if the football wasn't on. So, it might well be that your sector could be perhaps the only sector, if you like, to benefit from the six nations going behind a paywall.

You're proving to be a member of incredible discernment—dry January being neglected and a Cardiff City sponsorship is something else. [Laugher.] You're right, but, of course, what I think it demonstrates is the huge scale of our industry and it's very often considered to be leisure or an afterthought in the economic table, but we are so important and so diverse, that, really, all repercussions will vary across the industry. There will be people who will benefit; there'll be others who will lose. But, in the main, most pubs and most communities would have pubs without that specialist facility and I think that's something that the broad numbers of our members would appreciate. But we're obviously ultra supportive of all our members, particularly those who are able to find a niche and a unique selling point that will help them to keep going in the current climate.

Thank you, Dave. I know that Huw wants to come in on this, and Richard and then I've got Hefin, who wanted to ask a question as well. So, I'll go to Huw first and then to Richard. Huw.

I would endorse what was said—I endorse what Alun said. From our experience in our little club in Pentyrch, more people come to watch when the games are on channels that we pay to view. We have to acknowledge that the game in Wales is different to that in England and Scotland, and that it is more working class here and more middle class in the other nations. So, there is less money available for rugby supporters, and, by now, taking a family to watch a game live could cost around £500, £600, and that is beyond the pockets of many people.

And also, in terms of the channels that we pay for, there are some who can't afford it; there are some who are against the principle of having to pay. Many would say that these matches should be available for all. So, between all of those aspects, from our experience—. And if I spoke to the treasurer that we have in Pentyrch, in one way he would welcome the fact that these games have to go on pay-per-view channels, but not every club and pub can afford even to have these channels. As was said, the games are broadcast on so many different channels that it costs quite a lot of money in a public area to have four or five channels that we have to pay for. But for those who can afford it there is profit for clubs as a result of that—if people don't have it at home, they come to the club, and in one way that does increase the community feeling in our different villages.

Thank you for that. We'll go to Richard and then Hefin. Richard.

Thank you, and I'd concur with the things just said there. So, there are two interrelated things here: one that was mentioned about the fragmentary nature of sports rights and the way that you can watch sport. A bit of research was done in Scotland for Scottish football fans, where, if you wanted to watch every single format of either club football or international football, it would cost a Scottish football fan about £53 a month with the various subscriptions—that's just the sports-related subscriptions. Many households just can't afford that, honestly, in this current climate.

The issue about pubs and public spaces is also important for, 'Well, where would young people go?' Some pubs might well let young people into pubs, but it's still an environment that has a generational divide, so you're starting to exclude certain audiences from watching live sport once it goes behind a paywall, either because the household can't afford it or because it's in a public space that is not really conducive for young people to attend and watch the sport. So, the issue, really, around free-to-air sport, and rugby in particular, which we're discussing today, is fundamental, really, it's about access and how people can access it and at what price point—so, going back to the idea of the listed events, which supports that public good argument that sport is an important part of culture and society, and sharing the ups and downs of your national team is actually quite an important part of identity and connecting people in particular ways. So, access to that is very valuable.

I'd like to pick up on what Richard said there and perhaps put it to our media experts. The WRU was pretty clear that—. Can you hear me, Chair?

Just at the beginning of your sentence we couldn't, but we can hear you now okay.

You can hear me, yes?

Yes.

Yes. So, I'll put it to the media experts. The WRU was pretty clear, they aren't going to shift on this, and the six nations committee looks to be hugely influential on UK Government approaches. So, we need a plan B. I'm just going to concentrate—. Richard, I know you made the point about domestic viewing, but I'm thinking about hospitality. Would a plan B—? Given that the fragmented nature of the subscription services means that no pub could possibly affordably subscribe to everything, certainly not Gilfach Workmens Club, which is where I'll be watching on Saturday, and the various workies and institutes across the Valleys communities in which I live, would it be better then to push for a deal, perhaps even regulation of subscription services by the UK Government across the UK, so that a single fee and point of offer is made to hospitality services at a subsidised level in order to make sure that all sport is available to watch at those venues?

Who would like to—? Richard.

I think that's a really interesting idea. There was a slightly different amendment proposed to the Media Bill by, again, a Scottish MP who is quite vehement in trying again to open up free-to-air access to Scottish qualifying games in football, but the same principle applies. I think the idea that—. I suppose, coming back to the governing bodies of sport, the argument about going behind a paywall is that it increases commercial income, which then trickles down the pyramid to grass-roots sport. But, of course, the flipside of that is that the visibility of the sport also decreases, and, if you can't see it, you can't be it, in a sense. And, again, I know Welsh rugby at the grass roots is very strong, or has been historically, but it potentially gets undermined if people can't view the elite level of the game in their communities. So, the idea of public funding for sport that's supporting the ability to watch sport, but also how then that feeds into just the visibility and the participation in sport at grass-roots level I think is a very valid argument to discuss.

The mechanisms for that obviously might be quite complicated in some respects—different sports would make, again, different claims for how that public money might be spent in the circumstance. But I do think that regulation needs to step in here to, in a sense, balance the playing field, because I think the danger is—. Because the other dynamic of all this in a global sense is that football, soccer, is by far the most dominant sport—. Sky have just done a new deal for the English Premier League and with English league football as well, and are going to show over 1,000 games a season, going forward. So, other sports are just getting pushed out, and following the model that football has done is not necessarily the best model for all governing bodies to follow, I think. And I think rugby maybe needs to take a look at that in terms of what's the benefit for itself in terms of growing the game and the passion for the game and so on.

The game is growing worldwide. Across Europe, there are more people playing rugby, arguably, and in African nations as well; obviously, there's a world cup forthcoming in the United States. So, the global growth of the game is there, potentially, but at its roots—which arguably Wales is—some of the commercial decisions could really undermine the value of the game in that nation, if they're not careful, by doing strange deals that just exclude people from watching it.

[Inaudible.]—of time, so we will have to move on very soon to Llyr, but Tom wanted to come in just on one of the points that you were making.

Sorry, can I just come back to you, Professor Haynes, on the point you were making there about football—the 1,000 games a season, the record deals, the growth of the Premier League? The interesting aspect to me at least is there's clearly a demand or a willingness among many people to pay a premium for what they see as a premium product, which would be the Premier League, and with football being the most popular sport. Is there evidence that people are also willing to pay for what they might see as secondary sports, if you like—which, everything is, frankly, behind football?

I don't have the evidence for that. I think cricket was mentioned earlier, and I think what cricket has had to do is continually experiment with the format of the game of cricket into a shorter format to make it more exciting and entertaining. And we might come on to the discussion that, for younger generations of viewers of sport, or fans of sport, live sport is not always the kind of content that they want to consume. Again, Ofcom evidence suggests that, that younger viewers or younger fans of sport use different forms of content, either through social media or other streaming services, and other kinds of narrative about sport. So, Drive to Survive, for example, for Formula 1, has definitely grown the sport, particularly in the United States, amongst younger viewers.

So, again, governing bodies looking at their sports rights perhaps need to look a bit broader around what kind of content they're producing and who it's for. Live sport remains the premium and that's probably where people are most likely to want to pay, but there are, as we now know, lots of other platforms for delivering content. So, it really is about coming up with the right mix for any given sport that really showcases the value of the sport, the entertainment factor of the sport and so on and so forth, that keeps the appeal going. And it's a complicated balance; I'm sure you've heard that from the Welsh Rugby Union themselves.

Seimon, did you want to come in on this?

Yes, please. Thank you, Chair. Yes, I just wanted to come in very briefly on the discussion around cricket, because I think that there is a perception that cricket has disappeared as a discussion topic on the ground and I think that there is anecdotal evidence that might suggest that. It's difficult to find things; I was driving up from the south on Sunday and I was trying to listen to the cricket and it was hidden away on talkSPORT 2, and it was very difficult to access in the car in west Wales. So, I think there is a lack of visibility there, but I think the ECB and Cricket Wales have put programmes in place to try and mitigate those negative impacts.

If you look, I think, at participation, the number of men playing cricket has fallen since 2005, since it went behind the paywall, the number of children has remained consistent, and the number of women playing cricket has increased significantly. So, what ECB and Cricket Wales have tried to do is be very creative in bringing in different kinds of games. They've created The Hundred and Twenty20 and so on. It isn't traditional cricket for those traditionalists who like those three-day or five-day tournaments, but there are ways of overcoming this. So, the picture around cricket isn't as clear as that the game has disappeared entirely and people don't follow it anymore; it is more complex than that, I think.

We'll have to move on, unfortunately. We'll go to Llyr.

Thank you very much, Chair, and good morning, all. There's no doubt as to the significance of the six nations in terms of Wales's national life, but I was looking at the criteria that the DCMS looks at in terms of listed events, and it says that it has to have special national resonance—there's no doubt about that in this context—that it is an element that serves to unite the nation—that happens in a way that nearly nothing else does at this time of year—that it's a shared point on the national calendar—well, we hear of people coming together on weekends at this time of the year specifically to view these matches—and that it's not solely of interest to those who follow the sport in question—that's true as well, because there are some people who never watch rugby who will sit down and watch Wales playing in the six nations. It does tick all those boxes, and the question here, in essence, for me, is: while the union says there is a need to strike a balance between exposure, access and revenue, because of the social, cultural, economic significance—we've heard about the hospitality sector—of the championship, shouldn't we say that the six nations should be protected in terms of public service broadcasting?

I agree entirely with what Llyr said about the historic and current importance of the game to our culture as a nation. The one thing I'm not sure about is that we here in Wales are discussing this issue, but do we have to have consent across all of the nations before this is implemented? Or would Wales be able to go out and come to its own agreement on rugby games involving Wales? That has happened with football, hasn't it, because S4C and the football association have succeeded in getting the recent football games on free-to-air television. So, can we in Wales seek to discuss these issues here as one nation, or do we have to have the consent across all of the nations?

That would be something that Westminster would have to decide. Westminster have suggested that if the Welsh Government felt strongly about this, they would take that into consideration, because even though broadcasting isn't devolved, sport is devolved. It's not completely clear, but they have said that they would take that into consideration, certainly, and therefore the door hasn't closed, I don't think.

In terms of the Welsh language, it would be very good if those games were shown on S4C once again, as happens with football. More people would watch through the medium of Welsh, and that would be a good thing, I think.

Diolch, Huw. I think Richard's hand went up marginally before Seimon's, so shall we go to Richard first and then to Seimon?

I support the idea that, yes, the six nations as part of our cultural heritage across all parts of the UK is very much valued by many people across the country, watched by millions, obviously, when it is free-to-air, and it has been free-to-air. When you look at the other sports or events on the listed events, the six nations really should be on there.

I suppose the challenge, regulatory-wise, and particularly if you have specific Wales clauses in the listed events, is that, obviously, broadcasting policy regulation remains a reserved matter for Westminster. If a deal was done for S4C, it still would be available in Scotland and England and Northern Ireland to view on some platform or other, so it becomes very complex about how to slice this pie in ways that work for all.

Fundamentally, the structure of the regulatory area around broadcasting is one of the things that is creating this problem, really. The fact that sport is devolved is also complicated, because again, the amendment put in for the media Bill, which wasn't successful, had underlying it the idea that if governing bodies lost some of their commercial income by being free-to-air under the listed events, governing bodies of sport or the Parliaments and Governments of the devolved nations could receive funding to support the grass roots and that income lost.

That, again, raises whole questions about the Barnett formula and how that would work and so on and so forth, so it's really, really complicated. The regulatory regime of broadcasting creates this scenario where it is difficult. I think if the Welsh Parliament were able to make its own listed events, the six nations would be the first thing on the list, I'm sure, for obvious reasons. That's the fundamental problem here, at root, and in terms of siphoning off one nation within the listed events, although it was recommended by the David Davies independent review of listed events in 2009, the mechanisms for that to work are very difficult, I think.

Forgive me, and I know that Seimon wants to come in as well, but there is a precedent, of course, with there being a different situation—. I think that Llyr probably was about to make this point—forgive me, Llyr. But with Scotland, with the Scottish FA Cup, there's a recognition within the legislation that there's a particular resonance. I'm having Alun gesticulating at me in the room implying it isn't quite the same thing, but there is that precedent there.

That's true, yes. I think anything is workable. I think the question about the S4C thing—which might have been not necessarily a listed events thing, but a commercial decision that the six nations could make, that, like with the football, a minority language channel could have access to showing coverage—is the idea that, also, it would still be available elsewhere in the UK, which, again, for the rights holder might be something that would stop them doing it. Welsh football games against whoever across Europe, or in qualifying games, is not likely to be as popular as six nations games of rugby, where all four home nations are involved. So, yes, there are issues there, commercially, around that idea.

We'll go to Seimon, and then we'll go back to Llyr.

Thank you. I was going to make a point about finance, but I just want to make a quick point about broadcasting in the Welsh language. I think it's vital, whatever happens, that there is Welsh provision available and openly. Recently, Amazon has provided two streams, exactly the same, during the autumn internationals—that seems to be working well. But it has to be accessible and easy to reach, and of good quality.

Just to go back to Llyr's point on whether the six nations should be moved to group A, I think we need to be very aware of the impact on the grass-roots level and the possibility of reducing income for the WRU. So, yes, the game is going to be available if it's moved to group A, but we see the impact and the shortage of money. They need to increase their income. They've got the Rafferty report and they've got to respond to that, and that's going to cost money for them to do so. And, therefore, it's something that concerns me.

We see less income coming in, which means that the professional clubs are going to spend less, players are going to leave, there'll be less time to prepare. We've heard people say they're not available to play in Wales, even though they're eligible—those players who are playing in Japan and France. It weakens the national team, and is likely to reduce that success element.

There's a lot of investment currently, and the union currently is sort of ring-fencing money that goes to the community game. So, in moving from category B to category A, there is a risk that the income is reduced, and the investment in every layer of the game in Wales is reduced, and it weakens that link between the population and the game.

I wasn't arguing in favour of that come what may attitude, but that's the fundamental tension: that this is of such fundamental importance that other things, despite the implications, which perhaps might not be as extreme as some suggest, but who knows—. But there is a tension there, isn't there?

And just to respond to Richard, of course, it's the significance and the comparative importance in terms of the six nations in Wales, as compared to the other nations that make up the tournament, that I think is important to remember here. We heard from the BBC that 65 per cent of Wales's television audience watched the first game of the six nations last year or the year before, which is far higher than any other of the nations that compete. So, that's the thing—that comparative difference, and the comparative interest in Wales.

May I ask, therefore, one brief question? I know that time is against us. But we've talked about cricket and the impact—I won't pursue that again—but, in terms of this trade-off between getting the money in and losing that popular audience to an extent. But there is a halfway house here, isn't there, because we know that broadcasters have bought rights, but have agreed to broadcast elements for free on YouTube, for example. The final of the US Open was on Channel 4, for example. So, would you think that that would offer a response that would tick both boxes that we're trying to achieve? How practical and how common is that arrangement? Because it doesn't happen often.

Everybody's thinking. Huw wanted to come in first, and then we'll go to Richard.

Is Llyr suggesting there that some of the six nations matches are broadcast?

Perhaps, in selling the rights, that they say that Wales's home matches should be available on some sort of platform.

Would there be a reception to that across the spectrum—I'm not quite sure—that some are available, particularly Wales games? But as you were saying, Wales is different, because a lot of the population here follows rugby, and that's not true in England and even Scotland. But I am in a quandary on this, as many people are. When you balance the negative impact that would arise if the matches weren't available to all, but on the other hand, the financial aspect, which is emphasised by Nigel Walker and the chief executive before our session, it's difficult to strike a balance and decide which one of those is most important to us and the game.

And the idea that we heard that the game is healthy at grass-roots level is not true. Fewer people are playing. If you look at a weekend of rugby in Wales, about 20 matches are postponed because teams can't get the players to play. So the game at grass-roots level isn't thriving to a level as some people think it is. So, is it funding that's needed, or exposure, as you say? And that is the dilemma for everybody, I think. If the Senedd decides or presses to have these games free, what hope is there of succeeding in that if the other nations don't agree, and also that the board of the WRU don't support what the Senedd are saying?

Those are some of the questions that we'll have to consider.

Because the committee in London have turned it down once. So, Wales needs to make a very positive and strong point to have these games free. But if the WRU objects to that, it's going to be very difficult, I would say.

Thank you, Huw. I know—

Can I come in there, Chair, because my question's related to that?

Yes, sure.

To Huw and the experts: have we got any chance whatsoever of persuading the WRU to change their minds, and, subsequently, perhaps, even the six nations committee?

It's going to be very difficult, isn't it? The commercial side of rugby is increasingly complex because of the type of investments that are going on there. As we know, CVC have invested in a whole range of different levels of rugby, internationally and locally, in the six nations. So, you've got private investment wanting to get a return on that investment. So, that's one immediate commercial challenge, which maybe is behind some of the conversations or pronouncements that the WRU make. But their principal job, really, though, is, as you say, growing the grass roots of the sport, because if you haven't got that pipeline of talent, the national team will flounder at some point because there aren't enough people playing.

So, I think, in terms of the challenge, other nations probably would support, in terms of politicians anyway—there seemed to be quite a lot of cross-party support in the house the other day regarding this, in terms of listed events. But the Government's view seems to be, 'Well, governing bodies know best. It's their commercial priorities that come first', so they won't touch it. That's the sticking point, isn't it?

One of the equations in all this is that I would argue that if more eyeballs are watching the content, on whatever platform it's on—whether it's on traditional television, streaming services, social media, you name it, wherever that is—if there's more content available to view, that is more opportunity for sponsorship, advertising and other forms of commercial revenue.

One of the biggest forms of commercial revenue for streaming services in particular is data—data about who's watching what, when, and where. A lot of that isn't shared publicly, but for the likes of Netflix, Amazon, Apple and so on, part of their business model really is about the data behind who's watching what. And so, sport needs to wise up to that, that they have a stake in that game about how that data is used for commercial purposes. So, arguably, the more people watch content, the bigger the value of that data, for them, and the market is around sport. Sports marketing is a huge multibillion-dollar industry; it's huge and global. So, I think that's all in the mix. It's very, very complex, of course. But I think that is part of an argument that could be made to the rugby unions, to say, 'Well, look, can we help you in thinking through broader commercial opportunities by keeping the game free-to-air, as many people watching it as possible, supporting the grass roots, through that visibility, at the same time, enable you to grow the commercial opportunities in different ways?' Because visibility can be across different platforms, different kinds of narratives and storytelling to different generations of people—that, for me, is a win-win. But at the minute, I don't think that's the way in which the current Westminster Government is viewing this at all.

Thank you. Seimon, did you want to come in before we move on?

Yes, please. Just very briefly, I want to return to the question from Hefin in terms of how one could persuade the WRU to change its stance, and I think there are two things that the Senedd and Welsh Government perhaps could do. One of them would be to make up any shortfall between the contract that was agreed by going to category A and staying in category B—there's likely to be less income for the game in Wales, so you could make up that shortfall in terms of the grass-roots game, through grants and that sort of thing. And the second thing, then, and something that's been in the news over the past few weeks, is the loan that the Government has provided to the WRU to support the professional clubs in the four regions. We've heard that their debts, the four clubs, means that around £2 million per club, which is £8 million overall, is disappearing from the game in Wales to repay the loans—not just to the Welsh Government, but there's a great deal of money being taken out of the game, as a result of that, so perhaps there would be less pressure on the union to increase the income they receive, if they renegotiated that loan.

Alun has a supplementary question—we'll go to Alun. Llyr, do you want us to come back to you after that? Okay, yes. We'll go to Alun and then back to Llyr. Alun.

Thank you. I think we're all asking more questions than we're actually answering this morning. The heart of the case that Abi Tierney's outlined against restricting the rights of the six nations is that, and I'll quote from her letter to the committee:

'Our position'—

the WRU position—

'is not that Six Nations Championship rugby should be moved away from free-to-air television channels. It is that to place this restriction on rugby would artificially

restrict the market for our media rights and significantly diminish our earning potential to devastating effect on our game.'

And I think Nigel Walker continued the argument this morning that we need to retain the option to broadcast on subscription services, in order to keep the existing tension in the market. Now, the question to yourselves—and I accept that you've all got different experiences, so will answer from different perspectives, and perhaps not wish to answer these questions at all, and that's all fine—is to what extent do you agree with the analysis of the WRU? To what extent do you believe that such a restriction on rugby would have the, inverted commas, 'devastating effect on our game'? And to what extent do you believe the WRU analysis is correct and, therefore, the six nations—despite what we might wish for—should remain on the open market?

Who would like to go first on that? Okay, I'll go to Seimon first now, as a change. Seimon.

Thank you, Chair. Just to answer Alun's question there: I sympathise, I think, with the union's argument this morning, and the letter that was submitted beforehand. So, I understand their point of view—they're not just arguing to sell the rights for the highest possible price. I think they want to increase the tension in the market, so that if the six nations matches went to category A, there wouldn't be a tension there, because the pay-per-view wouldn't be able to compete, so there's a risk that the bid from BBC, ITV and whoever else would be very low and then impact on the game.

So, I do agree, I think, essentially, with the union's position, and I am concerned that moving the game from category B to category A could have a negative and very serious impact on the game. But as we've been discussing all morning, that tension does exist, doesn't it? We want to keep our eye on the game, we want as many people as possible to watch the games, and to be inspired from seeing these giants playing. But we also need to have that money behind us to do all the work that the union needs to do to maintain the game at grass-roots level and at professional level.

Richard, I think you wanted to come in on this.

I think we can certainly see the point of view commercially. If an event like the six nations became a listed event, then, clearly, the market for who the broadcaster would be would be shrunk quite dramatically, potentially. And therefore, as has been said, the value of the rights would be diminished too. I suppose part of the answer might be about finding ways in which it could be free-to-air, on an open commercial basis, or that the six nations could be persuaded to view it as advantageous, so that—. It's a tricky one. I think part of what you have to listen to is what's coming from the broadcasters like BBC and ITV, because they're working from a shrinking pot as well. So, if it was on the open market, I would say the likelihood of BBC, ITV retaining rights to the six nations is also a bit of a dodgy proposition. I don't think they're increasingly going to be able to afford a competitive price, going forward, and that's been signalled by the outgoing head of sport, Barbara Slater, at the BBC, I think.

So, I come back to the idea that, by being listed and restricted in that form of commercial income opens up other potential opportunities around sponsorship and other forms of commercial income, by having more people watch it. And there are marketing opportunities there that need to be explored, I think. But part of the argument also is about, well, this isn't about finance, this is about the cultural resonance of rugby in Wales, and is that more important? Does that trump all? But the rugby union, obviously, argues that that's not how they see it at present.

[Inaudible.] We already have a listings process in place for some events. So, we do have experience, therefore, of a restricted marketplace. We've got a restricted marketplace in the group A events at present. Is there any evidence that that restricted marketplace has led to a significant diminution in the value of those rights, and in the income to the governing bodies?

Richard.

I suppose one case study there is if you look at Wimbledon. Wimbledon is a very thriving commercial enterprise. We might question whether they've capitalised on, let's call it the Murray factor, of the visibility of a British champion in tennis to then spread the game—probably there are a few people playing tennis. There's also a question about the elitism around tennis, to a certain extent. But that's, again, all about sports development and where priorities lie around that. But I think, commercially, Wimbledon is incredibly successful. They're looking to grow the tournament, globally—it's a huge brand, which has been very successful. Arguably, the six nations is a huge brand. There are international opportunities to sell the six nations games globally. That's potentially a very big income earner—in Australia or New Zealand, or wherever. As the game grows globally, more and more people want to watch it. So, I think there are opportunities, even if it is a listed event, to grow commercial income in other areas.

I fully accept all of that, but my question was slightly different, I'm sorry. My question was about the value of the rights. Now, intuitively, I would agree with the analysis of the WRU—if you're selling in a restricted market, clearly you don't have the same, I would have anticipated, value as you might be able to accrue in an open market, for clear reasons. And the argument I felt that Nigel and Abi were putting forward this morning was a very credible one for that reason. My question was: is there ever any evidence that that argument and that intuitive assumption is actually borne out by evidence in the existing marketplace?

My answer is I don't fully know, but I think the answer around, I would say—the Wimbledon championships; I don't think they're struggling commercially. If Wimbledon were to go behind a paywall I think that would change the dynamic of tennis in the UK, at least, quite radically. A lot of tennis, though, is already behind a paywall, of course. But the Wimbledon championships definitely still have very strong resonance across the country, I think, when they're on. Things like the world FIFA World Cup—the finals tournament is a massive fillip for football, the game of football internationally. I think the rights to world cup finals, again, are pretty valuable, and keep going up every four years. So, the evidence for that is that, in some cases, or maybe in most cases, those listed events still maintain their commercial value, or have done. And part of that is also a question about whether Sky or any other niche sports provider would necessarily want to carry some of these events, because they don't fit into their model, either. Wimbledon would be a tricky one in the sense, if it went to Sky—that's not really in the nature of what they're about. They want things that will keep people coming back to watch and subscribe month after month. Wimbledon lasts for two weeks. So, commercially it's very complicated, but I think that would be my answer to your question.

Thank you so much. I know that Huw wanted to answer Alun's original question and then we're going to go to Llyr, I think, probably for the final question, because we're almost out of time.

So, Huw, do you want to—?

You've been involved in the game for decades, if I may say so, so do you see the same argument in terms of Wales at the grass-roots level, and the impact that the WRU suggests that that would have on that level?

At heart, I feel strongly that the game should be available to all because of our community tradition of the game. But on the other hand, in the current climate, financially and economically, I can see Abi and Nigel's argument very clearly. In the end, I would think we're talking about the negative impact that perhaps going on a pay-to-view channel would have on the match—fewer people—but ultimately I think having more funding into the game, perhaps, would have more of an impact than that. Because from what I understand, the two teams in Scotland, for example, have three times as much money as the regional teams in Wales, and they're thriving. The situation of our regions, and our national team, to some extent, is very, very sad currently. What is to be seen in that is that players aren't happy with the conditions they're offered, they disappear to other countries—that weakens our game at a community level and at international level, and ultimately, if the regions and our national team are having a hard time on the pitch, there will be less interest among young people. They like to see success, and if by having more money into the regions and into the grass-roots clubs—if that's the way of ensuring success at a high level, then I see that that argument is a very strong one on behalf of the union.

Thank you for that. We'll have to go to the final question now, I'm afraid.

We have 15 seconds left of time, so we might go a few minutes over. Llyr, for the last question.

Okay, thank you, Chair. Seimon referred earlier to the comparison with cricket, and perhaps that isn't the fairest comparison, but he did say, of course, that the number of men participating in the sport had declined, with the number of women and young people increasing. Well, there's a wider phenomenon in terms of women's sport—we've seen a similar trend in football and rugby. Perhaps, in terms of young people, the investment reaching the grass-roots has had an impact too. But we all see, during the Wimbledon fortnight, everybody playing tennis. Those empty tennis courts in our villages and towns are full of people; we've seen the same with football during the world cup. And the six nations is the same: there is a peak of interest at that time, isn't there? But without those people having easy access to that sport, the level of interest isn't going to be there.

So, the point I'm trying to make is that that—and Richard referred to this earlier too—then has implications in terms of revenue too, because there is less interest, there is less attendance at games, fewer ticket sales for the regions, and fewer merchandise sales, and so on. So, that has an impact as well, doesn't it, which needs to be considered? I don't know whether that's a statement or a question there.

Well, something between the two, perhaps. Does anybody want to respond to that point, or offer final thoughts? Huw, did you want to respond?

Just that that's perhaps what I've said during this last hour—not coming out strongly on one side or the other. The problem for you is to decide which one of those two sides is the most important for the success of the game in Wales: is it the money, or the fact that the youngsters and the older people can see these games regularly without paying for them?

Diolch, Huw. Did anyone else want to come back in with any final reflections, or are you all content? I don't see anyone indicating—oh, yes, Richard.

[Inaudible.] One of the things, I suppose, for us to look at is the finances of the sport and where the money is spent. From what I know—and this applies in Scotland as well as Wales— is, although the turnover has increased through the commercial revenue, the costs have also increased, and it comes back to this idea of the retention of players within the game. Obviously, the athletes want to earn the highest living they can playing their sport, but it costs increasingly. We've seen this in the world of football with the amazing figures that people earn and, obviously, rugby has tried to manage and control that. But recently we have seen people drifting even out of the sport, never mind going elsewhere to play the game. There are so many different competing challenges that the rugby union faces in this, but, fundamentally, I think, if—. The women's sport, more broadly—team sport, in particular: football, rugby, cricket—that's an interesting phenomena, because most of that is free-to-air, is available for people to view, either on the main channels or, as in Scotland, BBC Alba do a lot of coverage of women's football, and it's been very successful in promoting the game. So, I think, again, if you can see it, then you maybe want to be it, and I think that edict still stands for rugby in Wales as well.

Thank you, Richard. Dave, you wanted to—

Very briefly, the associated point in that is to commend the events strategy for Welsh Government. I think it's vital that—. If we look at these matches, the three matches this year, the effect it has on city centre hotels and the city centre communities is really important, and we'd like to see as much support as Welsh Government could give to that events strategy to not only bring economic advantage to the locality, but also to project Wales as the wonderful place that is. I think the Champions League, for instance, was a great example to show that we're able to not only host but to lead in areas of that type.

Thank you, Dave. And then the final, final word to Seimon.

Thank you, Chair. I'll be very brief. Just a plea: if there is an intention on this committee's behalf, on the Senedd's behalf and the Welsh Government, to limit the ability of the union to generate income, I would urge the Senedd and the Government to set out alternative ways to support the game in Wales—to make up that shortfall in income. So, I'm just asking for help, really.

Thank you for that. Well, thank you to you all.

Thank you, all, very much indeed for your evidence this morning, your expertise and your different perspectives—they've really been incredibly valuable to us. So, thank you, all.

Thank you very much for your time.

A transcript of what's been said will be sent to you to check that it's a fair reflection of what's been said this morning.

Thank you very much to you all for attending this morning—we're very grateful. Thank you.

Thank you.

Thank you. All the best to you.

Thank you. Members, we move straight on to papers to note—so, you're welcome to leave us. We're very grateful to you for your time this morning—it's just still morning. Thank you very much.

Thank you very much.

Members, we'll move straight to papers to note. Items 4.1 and 4.2—are Members content for us to note those? Yes.

So, I propose, in accordance with Standing Order 17.42, to resolve to exclude the public from the remainder of today's meeting. Are Members content? We'll wait to hear that we're in private session.