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A level playing field for football on TV

Wednesday, October 05, 2011
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Pubs and clubs that want to show live football, cricket or rugby on Sky TV have to be extremely confident that it will raise their profits - the monthly cost of subscription runs to over £500 per month. For many, showing live sport is a way to keep customers coming to the pub rather than drinking at home, so may be the only strategy available to stay in business.You can easily see the benefit of finding a cheaper source of satellite broadcasts if possible, and this is the background to the well-publicised case in which Karen Murphy, landlady of a pub in Portsmouth, was taken to court by Sky and the Premier League for using a cheaper Greek decoder to bypass controls over match screening. The European Court of Justice has ruled that national laws which prohibit the import, sale or use of foreign decoder cards are contrary to the freedom to provide services.

Sky has a near-monopoly of the market for showing Premier League football, based on exclusive deals which the Premier League has set up with Sky and ESPN. The deals are complicated; broadcasters in Britain, such as Sky, pay a much higher fee for those matches than broadcasters in other European countries. On the other hand, in February, an European Court of Justice advocate general said that greater competition amongst broadcasters would be in line with the aims of the EU single market - a border-free zone for goods and services. A service which depends on satellite signals is easily available to be sold across borders, but the business model used by the Premier League, Sky and ESPN depends on selling rights to watch their broadcasts on a country-by-country basis.

On the face of it, it looks as if the ruling should open up the possibility for all sports fans to buy cheaper decoders and watch sport on satellite channels from around Europe - the ruling suggests that a football match cannot be subject to copyright or to Intellectual Property rights as they could not considered to be an author’s own “intellectual creation” and, therefore, to be “works” for the purposes of EU copyright law. According to Reuters’ report, “The ruling potentially throws in to question the value of rights bought by Britain’s BSkyB, which owns the majority of live rights for Premier League matches, and other European broadcasters such as Sky Deutschland.”

However, the Premier League can copyright some aspects of the televising of matches, such as showing or broadcasting anthems, highlights or graphics, which could then be used to prohibit broadcasters with whom they don’t have a licensing agreement from showing any Premier League matches. Many lawyers and analysts suggest the ruling would simply spark a scramble by rights holders such as the Premier League to come up with a new system, and one that could even cost sports fans more dearly in the future.

This matters very much to the League - they make around £1.4bn from overseas rights to show matches, of which £130mn comes from Europe. Clearly, it also matters very much to Sky, as many of us opt for satellite TV subscriptions in order to watch sport. It also matters very much to other production companies and broadcasters - the BBC report quotes the makers of Spooks who have warned that it could hinder investment in UK production if they can’t sell the programme country-by-country. It is vital for pubs and premises which are struggling to stay in business and need to lower their costs as far as possible. The european ruling doesn’t really clarify who wins, or what the strategy implications might be for each of the stakeholders - there will be much more to come in the battle, which is not an outright victory for Karen Murphy - or at least, not yet.

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