Scatmag.com
Scatmag.com

July 2016

NO ADS ON SPORTS FEED TO DD


On June 3, the Supreme Court ruled that Prasar Bharati must receive a 'clean feed' - free from all embedded advertisements and commercial elements, from all private broadcasters.



BACKGROUND

The law requires that all broadcasters must share a TV feed with Doordarshan, of any National sports event.

Broadcasters had contended that they could share a sports feed with the embedded advertisements, for retransmission on Doordarshan, as a Free To Air Broadcast.

In 2013, the Delhi High Court rejected ESPN Software Pvt Ltd plea that its responsibility was to share feed received from organisers, which would include advertisements, logos and other on-screen credits during the game.

Star India has since, bought out ESPN India, and subsequently appealed that decision in the Supreme Court.





STAR'S ARGUMENTS

Star India argued that the obligation of a broadcaster is limited to sharing of the world feed it receives from the event organiser/owner on as as-iswhere- is basis without advertisements of the television broadcaster under Section 3(1) of the Sports Act. The broadcaster, it argued, is not obliged to remove any onscreen credits inserted by the event organiser.

Star counsel Dr Abhishek Manu Singhvi argued that the broadcaster has no control over the on-screen credits and the expression "without its advertisements" in Section 3 alludes to the ads by broadcasters.

He also argued that the obligation under Section 3 is to simultaneously share the live "Broadcasting Signals" received by an entity carrying the television broadcast in India and not the live "event" itself.

Star argued that if a Wimbledon match had to be aired in the country whose official sponsor is Rolex SA, the present scheme would require Rolex names to be removed, which was unlikely. At present, Star India holds the rights to broadcast cricket events organised under the International Cricket Council in India.


GOVT ARGUMENTS

Attorney General Mukul Rohatgi submitted that the expression "without its advertisements" will include ads by any of the 3 categories mentioned in Section 3, namely:

(a) Content Right Owner,

(b) Holder &

(c) Service Provider.


SC JUDGEMENT

The bench of Justices AK Sikri and Prafulla C Pant noted that the motive of the sponsors whose logos are embedded in the feed is to advertise their company names with commercial motives in mind. These are, thus, commercials of the sponsors and would clearly be treated as not only advertisements but commercial advertisements, the bench added.

"Thus, even if it is ICC which has included those advertisements/logos, the feeds have to be without those logos/advertisements inasmuch as nobody can dispute that the content rights owner are content holder, i.e., ICC in the instant case has included those logos/ advertisements from a purely commercial angle. Thus, the arrangement between the ICC and the appellant is totally inconsequential," the bench stated, dismissing the appeal.



RELIEF TO ANALOG CABLE

With the TRAI reversing its 27.5% hike to analog Cable TV Headends, all pay channels are required to immediately reduce their subscription prices to analog cable Headends by 27.5% effective 10th May 2015.


OPTION FOR ADS

The Supreme Court underlined that when live broadcasting signal with advertisements is shared with Prasar Bharati, those advertisements will have a much larger viewership but the benefit would accrue only to those who have booked the advertisements. Therefore, the court said, "the sharing of the signals has to be without any advertisements and if the advertisements are also to be included in the signals, there has to be sharing of the revenue."


FINANCIAL IMPACT

Star India had in an additional affidavit in February 2015 said that it was losing around Rs. 290 crore every year by sharing its sports signals with Doordarshan and was expecting to lose around Rs. 120 crore by sharing the telecast of the World Cup this year. (Under the Sports Act, the rights holder gets 75% of the revenue from the telecast on DD which keeps the balance 25%.)


WIDE IMPLICATIONS

Obviously, this ruling will impact live broadcasts of various large sporting events, not just cricket. Removing ads inserted by the event sponsor, at site, such as Rolex at Wimbledon, may violate Wimbledon's terms for re-transmission of the feed. In such a case, the Supreme Court has said that the broadcaster (Star) will have to pay Prasar Bharti extra to retain the Rolex advertisements!

A media planner opined "My understanding is that it applies to TV sponsors roped in for various events by broadcasters. This cannot possibly apply to on-ground sponsors since it may not come under the jurisdiction of the Supreme Court. For example, for ICC events, the on-ground sponsors cannot be expected to be 'cleaned' from a television feed."

Harish Thawani, Chairman, Neo Sports, believes that the ramifications of the ruling will go beyond the broadcasters. "From what I have read in the media, the ruling will have an impact on the event owners as well. For one, the contracts for media rights and sponsorships (in some cases) have been signed a while back and the practice will have to be implemented now. So for an ICC event, Star may tell ICC that it cannot carry the logo of a commercial partner (of ICC) citing it is the law of the land. While Star will be correct in doing so, the commercial partner will want its money's worth and will take up the matter with the ICC. A lot needs to be clarified in the matter I feel. Also, what happens in cases where the on-air and on-ground rights are sold as a package?" he added.


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