Opinion – More Cap test cases for NRL expansion

Last time, we went off-piste and moved from rigorous analysis to speculative analysis. Let’s go further off-piste and apply Cap in ways that it was never meant to be (that’s why we’ve switched from “Analysis” to “Opinion”, even I have my limits).

Brisbane

Because of the capacity constraints discussed a few weeks ago, it’s a bit hard to judge just how popular NRL expansion would be in Brisbane. Using some Cap metrics, we can estimate what an “optimal” number of clubs might look like.

If we only care about maintaining a 15,000 average attendance, then:

  • 6 teams would give a Cap of 2.2
  • 5 teams = 2.6
  • 4 teams = 3.3
  • 3 teams = 4.4
  • 2 teams = 6.5

On the other hand, if we use the relationship between teams per capita and Cap developed a few weeks ago:

  • 2 teams would have a Cap of 4.0 and average attendances of 25,000
  • 3 teams, Cap 3.0, avg attendance 22,000
  • 4 teams, Cap 2.4, avg attendance 20,000
  • 5 teams, Cap 2.1, avg attendance 18,000
  • 6 teams, Cap 1.9, avg attendance 17,000

Given that the Broncos already maintain a Cap of 5.8 and Sydney has theirs around 3.5 to 4, it’s hard to see how two, three or even four clubs couldn’t be supported in the Brisbane metro area. The Broncos might have something to say about it though.

Melbourne

The Storm’s Cap has a long run average of about 27. That only just gets them the 15,000 average attendance we’re looking for. Even with the increase in total attendance that comes from expansion, Melbourne’s Cap would only improve to 18, equivalent to attendances of less than 11,000 for two teams.

I think that it would be fairly dubious to assume that discount would even hold when you consider how successful the Storm has been and how much of Melbourne’s disposable income is pumped into the AFL. The status quo is probably about as good as could be hoped for. There’s not a lot of eyeballs or dollars left to go around to get the NRL’s popularity to the Cap of 13 that would be required to support two teams.

Adelaide

Adelaide hasn’t had a team for nearly twenty years now and the Rams’ attendances at the time weren’t that special, around 7,000 to 8,000 per game in 1998. To get the 15,000 we’re looking for, the Cap in Adelaide would have to be 7.3. More likely, the NRL team would be about as popular as the Swans in Sydney. The Swan’s Cap of about 20 would get only 5,500 to games.

Somehow, in a city abandoned by rugby league and with no rugby union presence, the new Adelaide franchise would have to be more popular than soccer. It sounds laughable and it’s probably a Sisyphean task but one I think is worth doing, if only to have a properly national footprint. The NRL would need to be prepared to provide some additional funding to make up the shortfall in gate receipts.

Hobart

Why Hobart? Two reasons:

  1. There may be an A League bid coming for Hobart which would require the construction of a half decent rectangular stadium that would be otherwise unused in the winter
  2. It would stick one up the AFL

The AFL takes Tasmania for granted. The problem Tasmania has in their AFL bids is that there isn’t that many Tasmanians not currently watching the AFL that would start watching if there was an AFL expansion into Hobart. Consequently, the only professional sports team they have is the Hurricanes in the Big Bash. NRL expansion would potentially bring in new viewers, backed by a level of appreciation that Tasmania was actually taken seriously by a national institution.

The flip side is that a Hobart team would need a Cap of 1.2 to get the right attendances, something an AFL team could probably do but its unlikely that a NRL team would manage, especially if they had to share Hobart with the AFL. If, as is more likely, a Hobart NRL team could maintain the same Cap as the Storm, then average attendances would be 600 per game. Considering that the A League has never had fewer than 1,000 people turn up for a game, even in Townsville which has half the population and where soccer is for girls, it would be safe to say that the Cap would be a bit better than that but not enough to sustain a team.

However, it could be worth expanding into Hobart, forcing the AFL to spend money to do the same. The AFL would also likely create an expansion partner and without any obvious low-hanging fruit for expansion, both AFL teams would need considerable financial support to get going. Meanwhile, the NRL could pack its bags after a few seasons (“Sorry, its not viable”) and move on elsewhere. The AFL could never take away the team without experiencing an extraordinary backlash and would be committed to a 20 team format with the commensurate spending.

Regional Queensland

Central Queensland has four decent sized cities – Mackay, Gladstone, Rockhampton and Bundaberg, two of which are home to Queensland Cup teams. Mackay is the largest at just over 85,000. With such a small population, the Cap would need to be unprecedentedly good. 0.5 would only get them just over 14,000 per game. To get that in Geelong and Townsville required years of excellent management and probably a premiership. Good managers are not in massive supply in regional areas, so I would say that this is fairly speculative unless the team can split their home games across the four towns. The Cap would then be between about 1.5 and 2 which is a lot more achievable (think the Knights in Newcastle).

Toowoomba, population of 114,000, would have a better chance. They have an airport, aren’t too far from Brisbane and is currently in the midst of a population boom that the government forecasts to last a while. It would still require a Cap of 0.6 and considering they don’t have a Queensland Cup presence, its difficult to see where the people to both run the team and see the games would come from. There’s also no other obvious towns to share the hosting duties with.

The Sunshine Coast is just far enough from Brisbane to not be part of the metro area, out of the reach of the Broncos black hole, and has potential. The population is 307,000 and forecast to rise substantially. A Cap of 1.7 would be required to maintain 15,000 while the similarly placed Gold Coast only manages 3.5, which would translate to just over 7,000. While there’s some scope to pinch people from far northern Brisbane, a bit of population growth would be required to make this work. Having said that, the Sunny Coast is Australia’s ninth largest city, the largest not served by a professional mens sports team. The NRL already has teams in the 10th and 13th largest cities, so maybe a sub-2 Cap is not so impossible.

You can plug in the same numbers population-wise for NSW towns which will show the same thing: there’s not a lot of towns to expand into without taking a big risk on the competence of management and the support of a small population. The only possible way would be to have a rotating homegrounds to spread the load around which would be an expensive way to get people to games but would be good for the long term viability of the game in regional Australia.

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