Friday, October 21, 2005

DD to get feed of vital sports events from all channels

Deccan Herald writes: DD to get feed of vital sports events from all channels

In an utterly shocking news - something that goes against the grain of a free market, liberal country - Indian cabinet has enacted a policy that needs to be contested in the court of law.

Deeming certain sports events as events of national importance, the Indian cabinet has deemed that these matches of national importance must be shared by the rights holders with Prasar Bharati, with the revenue share of 75:25 in favour of the rights holders, without any minimum guarantee or opportunity cost. (Thank God, at least here they think the rights holder should get majority of the revenue.)

Worse still... Prasar Bharati can "transmit the feed of such events free to air on its terrestrial network and/or satellite/DTH mode". Until now, any such feed that Prasar Bharati acquired from rights holders went only on terrestrial network. Now, the cabinet deems this feed can go on satellite and DTH mode as well.

I suspect this will be first passed as an ordinance and then pushed through the Lok Sabha as a bill?

This will be a major body blow to the emerging DTH companies and cable TV conglomerates as well as sporting associations including BCCI. This will be the start of the death of sports in India.


Good sporting bodies make their monies by allowing rival television companies to bid and outbid each other. Television networks do so in the hope that they can extract the most out of the telecast righst they acquire. Unless the rights is exclusive, the rights holders cannot force all audience to watch their channel and generate subscription and advertising revenue.

Prasar Bharati/Doordarshan is free. So no one will subscribe anymore - except a small audience - to ESPN-Star Sports, Ten Sports, SET Max, Zee Sports etc. since the key cricket games will be shown on Doordarshan, DD Sports and DD's DTH platform. This will include Tests, ODIs that India plays as well as semis and finals of major cricket tournaments.

There is no risk whatsoever for Doordarshan.

The rewards to private television networks will diminish. So they will move away from acquiring the rights. This will result in rights broking intermediaries to emerge again. Such companies ruled the roost in the past - TWI, Stracon, Nimbus, UTV and such. They will acquire the rights instead of TV networks. This will bring down the value of the rights in the medium term. The rights holders will have to tussle with Doordarshan on who will have to market the airtime. Rights holders will be uncomfortable with a lethargic marketing of Doordarshan since 75% of a low number is low. Doordarshan is not interested in increasing the profits, since the handout from the government is always nearby. Losses are acceptable for them.

BCCI will get less money in the process. (Though that may be a good thing - undesiarable elements from BCCI may leave...) Other sports may not suffer much ininitially. But the Govt. may always amend their rules to make more and more sports under the list of events to be shown on Doordarshan.

Our television regulation is a mess. Chennai alone suffers from set top box regime. The govt., instead of dealing with this mess, has given in to lobbying from Doordarshan on sporting rights issue.

By sensibly regulationg private television networks, keeping distribution platforms away from channels and legislating that all channels must be made available on each distribution platform, by regulating the cost per channel subscription properly... better quality content can be made available at cheaper prices to people.

The current move is not good. But it will be welcomed by people in huge numbers in 'letter to the editor' column tomorrow.

I hope Zee, ESPN-Star and Ten together go to court against this ridiculous move.

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