Steve Dempsey Media and technology expert

IF YOU WANTED to find a business deal that seems like a win-win for all parties, you could do worse than look at RTÉ’s decision to sell its 50% stake in GAAGO to the GAA for €3 million.

On paper, it all looks hunky-dory. RTÉ gets cash. The GAA gets full control of its streaming subscription business, rebranded to GAA+. Everyone’s happy. But is this possible? Media is so often a zero-sum game, so who really are the winners here? And are there any losers?

RTÉ

For Montrose Mandarins, the deal makes sense. They’re effectively trading a large headache for a small amount of cash. Managing a niche streaming joint venture requires management bandwidth, legal oversight, technical investment and a lot of patience. For a broadcaster already navigating governance reform and cost discipline, that distraction may have outweighed the dividend income.

The sale allows them to illustrate they are reducing overheads, reinvest in regional facilities and refocusing on core public service output. That strengthens its position in debates about licence fee reform and state funding. It narrows its mission and reduces its exposure to culture wars about access. It’ll also remove a line of attack for mendacious TDs the next time RTÉ has to appear at an Oireachtas Committee.

In private equity terms, the deal may seem like an early exit at a modest multiple. But in public sector terms, it looks like canny simplification and risk reduction. You could say that the most important skill a media executive needs to have is to know when to sell. In this instance, Kevin Bakhurst has shown himself to be a skilled operator.

GAA

So what about the GAA? In an era where sports bodies are trying to disintermediate broadcasters, owning your own platform is an attractive proposition. The GAA can capture customer relationships directly, experiment and change direction without boardroom negotiation. So it looks like they’ve bought themselves a strategic asset. 

Doing some back of a beer mat maths, we can project just how much GAA+ could earn them.

If we assume modest 12% annual subscriber growth, ARPU of €85 with small price increases, production costs at 25% of revenue, and marketing and admin starting at €1.2m with 3% annual increase, you get a niche sports platform which by 2030 would have revenue of €10m per annum. And a nice operating profit of €6m per annum.

This is a tidy, but niche sports streaming product. Diaspora subscriptions can grow, but not exponentially. There is no obvious path to tenfold expansion unless the product evolves beyond match streaming into broader content creation and distribution, with every commercial opportunity realised. 

So what would that look like?

GAA offers shared cultural ritual and a sense of belonging and pride. It’s a nakedly commercial comment, but that sh*t can be monetised. There is huge potential to create a powerful and sticky distribution brand with a host of commercial add-ons.

Advertising, tiered membership, links to purchase tickets and perks, jersey sales, games and quizzes… there is huge scope for this to grow. The only question is where to start? Yes, it may always have a relatively small potential audience in Ireland and across the diaspora audience, but recent media development shows that niche offerings, with deep emotional relationships outperform broad offerings.

• Listen to The 42FM: How RTÉ handed the GAA a goldmine for €3m

RTÉ would be unlikely to have the risk appetite for this sort of ambition. Full ownership gives the GAA full control over ambition as well as distribution, pricing and data, which also have strategic value. 

The only risk relates to access. When a match sits behind a paywall and counties grumble, there is no longer a convenient public broadcaster to blame. The commercial logic becomes the association’s logic.

The GAA needs to be careful and transparent here. They need to ensure our national games aren’t just treated as a cash cow. Without RTE as a partner, the GAA alone controls the balance between revenue and reach. This could be a lonely and dangerous position to be in if they start getting the balance wrong. 

Dodgy Boxes

Another winner here may well be the owners and operators of Dodgy Box services. These illegal streaming services are present in an estimated 400,000 Irish households. And they’re undermining other streaming services. A ComReg survey from last week found that 57% of Irish consumers now have pay-TV subscriptions from traditional providers. This number has fallen from 70% in 2022. 

Subscriptions to streaming services like Disney+, Netflix and Amazon Prime are holding steady, which indicates that consumers of entertainment show more loyalty to Silicon Valley brands than local media brands. 

More matches disappearing from free-to-air TV and going to GAA+ could well be an acquisition and retention boon for the Dodgy Box market. 

Sports seems to be hit particularly hard. The League of Ireland podcast ‘Between the Stripes’ conducted a survey that found 47% of football fans watch games on dodgy boxes. Clubber, which broadcasts live coverage of more than 1,500 club GAA matches each year, estimates it’s losing around 40% of potential revenue to dodgy boxes.

Also, attempts to disrupt piracy have resulted in dodgy box users calling them to complain that they can no longer watch matches. Maybe that proves that some dodgy box users are unaware that they’re not using legit streamers. 

So what can be done?

This is one for our legislators, I’m afraid.

Ireland’s copyright laws say that the use of piracy streaming devices is illegal. So there is no administrative basis to fine or punish individuals except for a formal court prosecution.

In Italy, for example, legislation has been enacted that will see users of ‘Scatole Pirata’ fined, as well as operators penalised. Now, when there’s a raid on a dodgy distributor in Italy, the subscriber database and payment records are used to issue fines to users without drawn-out police prosecutions. Already, heaps of fines of €154 have been issued with penalties of up to €5,000 on the cards for repeat offenders.

Any enterprising TDs who sit on the Oireachtas Committee on Arts, Media, Communications, Culture and Sport could do a lot worse than get the minister to enact something similar, or failing that, translate the Italian legislation themselves and introduce it as a Private Members Bill.

This might keep them from trying to score political points when questioning RTÉ executives next time they’re in front of the committee. If that happened, we might all be the winners. 

Steve Dempsey is a media expert and commentator. He is also director of advocacy and communications with the Irish Cancer Society.