TV industry fights to stop streamers ‘locking up’ digital sports rights

Australians could miss out on watching televised major sporting events for free because of a “regulatory gap” that means broadcasts could effectively disappear behind a digital paywall.

Industry insiders warn of a mismatch between changes in free-to-air TV viewing habits, technology and updates to the federal government’s anti-siphoning scheme, which ensures free access to televised coverage of major sporting events.

The government’s new media bill seeks to update the anti-siphoning legislation.Credit: Marija Ercegovac

Under the scheme, pay TV providers are prevented from buying the rights to televise major sporting events – such as the Olympics, AFL and NRL grand finals and the FIFA World Cup – until free-to-air networks have had the chance to buy those rights.

The Prominence and Anti-siphoning Bill, introduced to parliament at the end of 2023, for the first time will also prevent streaming services such as Netflix and Amazon from having first purchase rights. However, the scheme does not cover the rights for digital streaming through apps such as 9Now, 10Play and SBS On Demand, the way people are increasingly watching television and live sport.

Currently, about 20 per cent of television is streamed, and that proportion is growing.

Scott Lorson, chief of aggregation platform Fetch, said the scheme should be updated to account for streaming rights because the bill contained a “clear regulatory gap” between the policy objective and the reality of how people are watching free-to-air television.

“The legislation needs to ensure that the protected sports are exactly that, protected, regardless of whether the free-to-air channel is accessed via an aerial or over the internet,” he said.

More recently, when purchasing the broadcast rights for a major event, the commercial networks have usually also acquired the digital rights. However, this is not always the case.

Seven, in its current broadcast deal with the AFL, does not hold the rights to the digital broadcast. These are held by Foxtel. As a result, viewers tuning into 7Plus to watch the first match of the 2024 AFL season last Thursday were offered The Best of Border and Police Force.

From next season, Seven holds the digital rights.

Communications Minister Michelle Rowland said the government was committed to modernising Australia’s “analogue-era media laws for the digital age”, and said the bill’s protections remained sufficient to ensure people could still view major sporting events for free.

Amazon purchased the rights to future ICC World Cup events.Credit: Getty Images

“The bill affirms that free-to-air terrestrial television broadcasting remains the ‘safety net’ for free access to televised coverage of iconic sporting events for all Australians,” Rowland said.

Bridget Fair, chief executive at FreeTV Australia, the lobby body for Nine, Seven and Ten, said by limiting the rules of the scheme, paid streamers would “lock up exclusive digital rights”, in a way that was similar to Amazon’s recent deal to broadcast the ICC Cricket World Cup. Nine is the publisher of this masthead.

“With more and more Australians getting their free TV over the internet, there is a real risk the anti-siphoning scheme will collapse under its own weight if it does not apply to free streaming rights,” Fair said.

Added to that, many newly built Australian homes do not have antennas installed, Fair said.

According to Alex Spurzem, local head of advertising for Australia’s largest TV provider Samsung, 80 per cent of Australian households have a smart TV and 36 per cent of Samsung’s new sales of smart TVs do not have an antenna connected.

Foxtel CEO Patrick Delany says the threat of pay TV companies taking the digital rights is low, as free-to-air networks usually negotiate for them while purchasing the broadcast rights.

“We support the legislative attempt of anti-siphoning in ensuring Australians can see events of national and cultural significance for free. But two of the free-to-air networks are now pay-TV companies. In the case of Nine [owner of Stan] or Ten [Paramount+], when they are acquiring the rights, there is no obligation for them to put on free channels,” he said at last month’s Senate inquiry into the bill.

The Senate committee will deliver a report on its findings from the inquiry into the bill on March 26.

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