The Hindu Business Line : TV rights — A permanent solution is feasible

PAKISTAN and India are fighting it out for cricket supremacy across the border but most Indian television viewers are being forced to focus on the wrangling between Ten Sports and Prasar Bharati in the Supreme Court.

Ten Sports had won the exclusive telecast rights for the current series of Test matches and one-dayers being played in Pakistan. Then the Ministry of Information and Broadcasting, with due approval from the Cabinet, came out with a fresh set of guidelines that ensure that Prasar Bharati will always be able to telecast such `events of national importance' despite having no such commercial rights.

As far as the Test matches are concerned, Prasar Bharati has walked away from any interim solution and a good many Indians whose cablewallah is not on the right side of Ten Sports will be deprived of the pleasure of watching them. The Supreme Court will take up the issue of one dayers on January 30.

The guidelines issued by the Ministry of Information and Broadcasting on November 11, 2005 contain the following relevant clauses:

5.2. The sports channels/sports rights management companies having TV broadcasting rights shall with immediate effect share their feed with Prasar Bharati for national and international sporting events of national importance, held in India or abroad, for terrestrial transmission and DTH broadcasting (free-to-air) under the following conditions:

5.2.1 The events of national importance shall be determined by the Ministry of Information and Broadcasting in consultation with Ministry of Sports and Youth Affairs, Prasar Bharati and the concerned sports channels/sports rights management companies. In case of cricket events, these shall include all matches featuring India and the finals and semi-finals of international competitions.

5.2.2 The above conditions shall apply to all future events including those covered by existing contracts of broadcasting rights. However, in the case of cricket events whose broadcasting rights have been obtained by sports channels/rights management companies prior to the issue of the notification in the matter, the rights holders will be obliged to share the feed for all matches featuring India and finals of international competitions.

5.2.3 Prasar Bharati shall transmit the feed, free to air, on its terrestrial channel and carried through the terrestrial network and/or the satellite/DTH mode.

5.2.4 The marketing of the events' rights (terrestrial as well as satellite/DTH) will be decided through mutual negotiations between Prasar Bharati and the rights holder. The marketing rights should go to the party, which offers to maximise the revenue.

5.2.5 Revenue sharing formula of 75:25 in favour of rights holders without any minimum guarantee/opportunity cost should be applied.

In the event of any dispute, the matter shall be referred to an arbitrator to be appointed by Secretary, Ministry of Law and Justice out of the approved panel of arbitrators.

The guidelines talk of `sharing the feed' as if there is only one unique type of feed. In fact, in commercial terms there are two types of feed. Clean Feed is a feed of the event with no advertisements superimposed or inserted during short breaks within the event. (As a customer you would like to see all sports events in such a manner but you know there is no realistic hope of seeing it.) Then there is Dirty Feed that has advertisements superimposed or inserted during short breaks within the event.

A broadcaster receiving a feed for transmission has the technical capability to contaminate the feed. A broadcaster can contaminate Clean Feed by inserting or superimposing its own advertisements. It can also contaminate Dirty Feed by completely replacing the original advertisements with its own.

However, having mere technical capabilities to contaminate the feed is not the same as having the legal rights to do so. Without clear legal rights to contaminate, the broadcaster should transmit the feed (clean or dirty) as it is received.

A careful examination of the guidelines does not show that they contemplate granting the right to contaminate to Prasar Bharati. Para 5.2.1 says "... share their feed... " and Para 5.2.3 says "Prasar Bharati shall transmit the feed... " Already in an interim order of a previous case, the Supreme Court has prevented Prasar Bharati from any tampering with the feed.

Giving Prasar Bharati the right to contaminate the feed would tantamount to giving it a huge commercial advantage when the guidelines or the national interest do not require it. National interest requires that Prasar Bharati broadcast the event to as wide an audience as possible without bothering about the commercial impact. However, the framers of the guidelines are secretly hopping that Prasar Bharati would somehow acquire this right and earn revenues from its re-transmission of the feed. Whether the 75:25 percent revenue share is for the revenues of both channels put together, or Prasar Bharati alone will handover 75 per cent of its earnings to the sports channel is not at all clear from the guidelines.

Given the vagueness in the guidelines, there is scope for the Supreme Court to read in certain conditions so as to safeguard the interests of all the three parties. (The long-suffering Indian television viewers form the third interested party after the sports channel and the public broadcaster.)

If it simply terms the guidelines un-Constitutional, the wrangling will continue and the public will suffer both on account of not being able to watch cricket matches and justice being delayed as the Judges of Supreme Court spend repeated time on cricketing matters. While upholding the guidelines, the Supreme Court should require the private sports channel with telecasting rights to give two alternatives to Prasar Bharti.

The first alternative would have the sports channel giving Prasar Bharati a Clean Feed with no right to contaminate it. In this case, the sports channel will not be able to earn through advertisements. Prasar Bharati will incur the minimum expenditure required to broadcast the event nationally. The second alternative would have the sports channel giving Prasar Bharati a Dirty Feed with no right to contaminate it, as well as the right amount of money that will tempt Prasar Bharati to accept this alternative over the previous one. The sports channel can recover the amount from its advertisers by leveraging Prasar Bharati's formidable reach.

Prasar Bharati also benefits as the sum offered will go towards offsetting its costs and may even give it profits. If Prasar Bharati finds that the profits are much less than what it could earn by directly bidding for the telecasting rights, it may even start bidding for such rights on its own. The Supreme Court need not fix any manner or mode of payment to be offered by the sports channel to Prasar Bharati under either of the two options. The sports channel could offer a lump sum amount, or a mix of a small up-front payment and a percentage of revenue from India, or only a percentage of total revenue.

Given the past record of wrangling dragging on even after the event has begun, the Court might like to fix the time for Prasar Bharati to make its choice known to the sports channel. In both the cases, the feed may have the logo of the sports channel in the upper left hand corner to which Prasar Bharati could add its own logo without obscuring the former. National interest is also being served as the event is being broadcast as widely as possible and the existing television broadcasting infrastructure is being used to the maximum.

This would be a win-win solution for all the three parties, and one that would finally allow the cricket-crazy Indian population to enjoy the real tournament on the field.

(The Pune-based author is a software consultant and lateral thinker.)