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Has The AFL Backed The Wrong Horse As They Try To Jack Up TV Rights Revenue

Network Ten owner Paramount Global, whose local operation are hoping that their US parent Company will come to the party to bid for AFL rights, has seen Warren Buffett’s Berkshire Hathaway snare 11% of the business for $2.61 billion.

Currently the AFL broadcast rights are held by Foxtel and Channel Nine with the local Paramount Plus operation banking on their US operation contributing in an effort to bid for the AFL rights.

At the same time AFL management has been spruiking their talks with Paramount Global in an effort to jack up the revenue they will get from local TV Companies and Foxtel who is still seen as the preferred streaming partner for the AFL.

Insiders are tipping that the business, who ChannelNews has been told by US sources are not prepared to get into a “Dutch auction” for the rights to AFL across their free to air network or their Paramount + streaming operation will be merged before the 2025 season, when the new AFL rights kick in.

The investment by Berkshire Hathaway is seen as being made because Paramount Global is possible takeover target and that splashing out money in Australia for a sports code that is “very Australia” with limited appeal outside of Australia’s Southern States is “not a high consideration” unless there is a “clear benefit” to the business.

Shares in Paramount Global surged 15% in New York following the acquisition of shares by Warren Buffett’s Berkshire Hathaway.

Bloomberg claims Berkshire may be betting on Paramount as a potential acquisition target with Bloomberg’s Intelligence analyst Geetha Ranganathan claiming the company’s best path may be to tie up with another company.

“Despite its streaming success, we expect Paramount to remain subscale, suggesting that it eventually will have to sell itself to a bigger media company or a deep-pocketed tech giant,” Ranganathan said in a note.

The investment takes advantage of the media company’s deflated share price, according to Cathy Seifert, an analyst with CFRA Research. Through Monday’s close, Paramount was down 7.2% this year, less than the S&P 500’s 16% drop.

Bloomberg pointed out that Berkshire has increased its position in media and technology companies over the past several months. The company has invested in Activision Blizzard, a video-game publisher that agreed to be acquired by Microsoft, as well as HP’s consumer PC division.

Twitter Love Affair

Paramount Global’s love of Twitter and left wing politics has seen Paramount + Australia and New Zealand cuddle up with Twitter who could have 20% of their users labelled as ‘fake or spam bots, with the announcement that they have extended their multi-year global agreement to deliver premium digital content around Paramount ANZ’s biggest live events, hit shows and franchises from the company’s Australian portfolio of brands, including Network 10, Paramount+, MTV and Nickelodeon.

The business that owns Network Ten claims Tentpole programs and key sporting events will be eligible for Twitter marketing support and brand sponsorship sales rights via Twitter’s Amplify program, which marries Paramount’s premium video with Twitter’s paid reach and targeting.

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