Optus is expected to pip Foxtel to the post in the race for the broadcast rights deal with Rugby Australia.
According to multiple reports, conversations between the governning body for rugby in Australia and the pay-TV providor have broken down.
The SMH reported that Foxtel has gone so far as to withdraw its five-year offer for the Super Rugby, National Rugby Championships and Wallabies Tests.
Optus has been heavily interested in rugby rights throughout the year, originally making a bid for the recent Rugby World Cup.
The lastest offer for the local rights to the game is understood to be somewhere in the region of $30 million a year.
Neither Optus or Foxtel have commented on the rumours, with Rugby Australia only confirming that general discussions were taking place.
Should the rights move to Optus, it would end one of the long-standing sports rights partnership deals in Australia, with Foxtel managing the broadcast since 1996.
Earlier this year, Foxtel revealed it would look to scale back its sports rights deals in a bid to improve its financial standing.
The previous rights deal between Rugby Australia, Foxtel and Ten was worth a record $285 million giving the pay-TV and free to air partners broadcast rights from 2016 and 2020.
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