Protecting Sport’s Crown Jewels in 2019

Introduction

“Sport has the power to change the world. It has the power to inspire. It has the power to unite people in a way that little else does”. The words of Nelson Mandela, who famously used sport and specifically the 1995 Rugby Union World Cup to unite South Africa. Reflecting the power sport has, the UK and other countries around the world have rules in place that seek to ensure that the maximum number of people have access to sporting events of national importance, rather than having their exposure limited to minority channels.

Listed Events in the UK

The Broadcasting Act 1996 (as amended) (the “Act”) regulates the showing of live sports in the UK. The Act gives the Secretary of State for Culture and Sport (the “Secretary of State”) the power to list events of national importance. What amounts to national importance is not defined, but the events on the list are those that generally “unite the nation” and are “not solely of interest to those that follow the sport in question”.

The current list is divided into two parts:

• Group A: which includes the Olympic Games, all matches in the FIFA World Cup Finals Tournament, the FA Cup Final, the Scottish FA Cup Final (in Scotland), the Grand National, the Derby, the Wimbledon Tennis Finals, the European Football Championship Finals Tournament, the Rugby Union World Cup Final and the Rugby League Challenge Cup Final; and
• Group B, which includes Cricket Test Matches played in England, non-finals play at Wimbledon and the Ryder Cup amongst others.

Group A Criteria

Group A events are considered to be the most important to the national interest. Ofcom will not grant consent for these events to be covered live on an exclusive basis unless certain criteria are met. The Act requires Ofcom to provide guidance on these criteria, and Ofcom does so in the Code on Sports and Other Listed and Designated Events (the “Code”).

The Code differentiates between two categories of television broadcaster. The ones that offer a television or EEA satellite service with a reach of 95% or more of the UK and who are available at no additional cost to the viewer (other than the licence fee) (the “Criteria”) and those that do not meet the Criteria. Currently, the channels that do meet the Criteria are BBC1, BBC2, ITV1, Channel 4 and Channel 5 (“Category 1 Channels”).

In order for Ofcom to grant consent to a broadcaster to exclusively broadcast a Group A event live, it will have to be satisfied that no broadcaster from the other category expressed an interest for or had bid on the rights. As part of this, Ofcom will also need to be satisfied that the relevant broadcaster had a genuine opportunity to acquire the rights on reasonable terms. This includes being given sufficient time to negotiate and reach an agreement.

The effect is not that Group A events are guaranteed to be shown on free-to-air television or that a Category 1 Channel is to have exclusive rights to show these events but that those free-to-air channels mentioned above must have a genuine opportunity to purchase the rights.

Group B Criteria

Group B events are those that are of national importance but not quite to the level of the Group A events. They are therefore afforded less protection. For these events, broadcasters from one category will be granted consent by Ofcom to show exclusive live coverage only if a broadcaster from the other category has had the opportunity to bid for the right to show the edited highlights or delayed coverage of that event.

The Code stipulates minimum requirements for the lengths and timings of such highlights. The highlights package must amount to at least 10% of the scheduled duration of the event, subject to them being a minimum of 30 minutes for an event lasting an hour or more, or whichever is the greater of the two. The scheduling of the highlights are up to the discretion of the broadcaster, save that a restriction may be imposed by the rights holder in relation to the delay that must be adhered to. This restriction is limited by the Code and the maximum duration of any delay will depend on the time the particular event is scheduled to finish.

Example: Cricket World Cup 2019

A number of games at the CWC19 are Group B listed events. These are the final, the semi-finals and, in this edition of the tournament, games involving England (as the only home nation participating). In practice, for the UK, this means that Sky Sports, a broadcaster that does not meet the Criteria, has been granted consent for the right to show these games exclusively live (as well as all the group games not involving England), with Channel 4 owning the rights to the highlights show.

The matches in the CWC19, for the most part, start at 10.30am and therefore the scheduled end of play (subject to any delays etc.) should be around 6pm. The Code states that the maximum delay that can be imposed for an event scheduled to end between 8am and 8pm is 2 hours. Channel 4’s highlights of England’s loss to Australia aired at 11pm, a full 5 hours after the final wicket fell. One can only speculate as to the reasons behind Channel 4 opting to show their highlights programme at this time.

There has been much talk recently regarding the lack of cricket on free-to-air television. Whilst that discussion is beyond the scope of this article, it is interesting to note the recent rumours surrounding the final and it being potentially made available to those who do not own a Sky Sports subscription (much in the same way as BT Sport have made the Champions League Finals available in the past).

The Digital Economy Act Amendment

A noteworthy amendment to the Digital Economy Act 2017 (which came into force on 27 June 2017) has given the Secretary of State the power to amend the 95% threshold. The reason for including this power is due to a fear that it will be hard for any television broadcaster to meet the 95% mark in the future. This is due to changing viewing patterns, with individuals now watching content on devices other than television sets. The Act currently only accounts for television reception and service, and not streaming on mobile devices (but see below). Any change in the threshold would mean that the current Category 1 Channels and others are more likely to be able to meet the Criteria in the future.

2019 Ofcom Consultation

The list of Group A and B events has been set since 1998, and despite calls to amend or scrap the system, this has not happened and no plans have been scheduled to do so. However, with the changes in how fans consume live sports content, Ofcom has proposed to update its methodology for assessing whether a broadcaster meets the Criteria. Ofcom’s proposals include:

• Keeping the 95% reception threshold, but assessing this figure with regards to the channel’s reception on all platforms, including through the internet; and
• Assessing whether a channel is received on a household’s “main screen” for watching TV channels. This is to be the largest screen in the household (previously this was just televisions).

Ofcom have received a number of responses (from broadcasters in both categories as well as rights holders) to its consultation document. Generally, the proposed changes have been well received. However, there are reservations from some quarters with regards to the accuracy and quality of the data that will be used to calculate the proportion of the population that can receive services.

If implemented, the change in methodology would mean that a larger number of channels would qualify as Category 1 Channels. Additionally, with ONS statistics stating that internet penetration in UK households is currently at 90% and rising, we are not far away from an internet only channel also meeting the Criteria.

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For more information please contact Alex Griffiths on +44 (0)20 7438 2108  or at Alex.Griffiths@crsblaw.com.