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EU Court Rules Against Exclusive TV Licensing Deal
First time accepted submitter r5r5 writes "In possibly a ground-breaking rule, European Court of Justice ruled against exclusive rights to broadcast sporting events within a single member state. The motivation is that such an agreement would enable each broadcaster to be granted absolute territorial exclusivity in the area covered by its licence and would therefore eliminate all competition between broadcasters in the field of those services and would thus partition the national markets in accordance with national borders. Could this be the beginning of dismounting the legacy system of exclusive distribution rights awarded to one company in one state?"
Does this mean that I no longer have to deal with blackouts on local football games?
Wow. A free market. What's next, sound money?
Well, I think you'll find that the extreme economic liberals consider exclusive licensing to be 'free market' since the event organiser should have the right to sell the broadcasting rights in whatever way he wishes.
Is to support the legal position that a citizen of an EU member state cannot be restricted from purchasing goods or services from any other member state - this is a rule that has been in position for years, and the FA were trying to have it not applied to their TV rights (as they gain billions from UK tv rights to Sky, which are now massively devalued).
It doesn't affect purchases of goods and services from outside of the EU.
Apple underwent a similar issue a few years ago over their iTunes store restrictions within the EU.
They ruined monopoly!
Is my 'Get Out of Competition Free' card still valid?
They will now be awarded to one company for all of europe. Yay!
Does the EU having common sense about stuff mean the USA will change one damm bit?
No. it won't change our tv mess at all.
Too big, been in control too long, far more money involved than the EU. Inertia going to keep it just like it is.
It's the smell of money, being counted and placed into neat little stacks, ready to purchase new legislation explicitly allowing exclusive distribution rights for copyrighted material.
Is it just my observation, or are there way too many stupid people in the world?
The only one I can think of off the top of my head is the NFL's Game Day package, which is available only via satellite in the US, but is also on cable in Canada. But you still have the option of getting a satellite. All US sports are broken up into regional areas, which mostly makes sense because I don't think a whole lot of Philadelphians want to watch the LA Clippers. But, the sports leagues also have internet packages that give you access to every game.
So I'm thinking that the situation is completely different in the US than Europe.
Vote monkeys into Congress. They are cheaper and more trustworthy.
sounds like the EU would be ok with one broadcaster having the rights for the entirety of europe
SURELY NOT!!!!!
What's next, sound money?
While certainly an interesting concept, the non-durable nature of sound makes it not very suitable to use as money. :-)
The Tao of math: The numbers you can count are not the real numbers.
A quick note to catch the Americans up on what matters most in the world:
Pubs in Britain had to pay more to show English games than pubs overseas because Sky (who held the British rights) charged more.
English football league is the richest in the world (most watched sports league in the world as a result)- in part because the TV money is so much higher there so it gets the best quality players.
A certain % of Sky's money there goes back to the clubs.
The English league will now lose some of the monetary advantage it had because Sky will have to compete with cheapo-European networks.
Recently Liverpool Football Club asked to be able to negotiate their own TV rights outside of the league. Their argument : we're a big club- we have more fans- more people turn on the telly to watch us than some of the smaller clubs- we should get more money than smaller clubs that no-one watches.
This was quickly shot down by everyone else who said it was a terrible idea. ESPECIALLY from the smaller clubs who would as a result get less money- but even some of the big clubs who would get more money as a result were not in favour.
This is actually how it works in Spain- where clubs like Real Madrid, and Barcelona have budgets that dwarf anyone else. Real Madrid and Barca are the big teams- they negotiate their own TV deals- and as a result have been (even before now) making more money than even the English teams- despite the Spanish league being poorer (wealthwise) in general.
Liverpool have a point though- now England is losing their advantage as a league- Real Madrid and Barcelona are going to have way more money than any club in England- because they get to negotiate their own deals. Being in England is no longer an advantage- so the wealth gap to the big Spanish teams will grow.
The tide of power that had been in England for a number of years is now going to shift back to Spain again because their clubs will have much bigger budgets.
"That's the way to do it" - Punch
LOL. Here come the metanationals, you idiot. There will be on licensed group for the entire EU, and the small time broadcasters will have to pay up to this 'middle man' of a sorts for broadcast rights. Prices will be driven up, advertising prices will be driven up, sports attendance prices will be driven up. God bless the free market (even though there is nothing actually free about it).
This is my sig. There are many like it, but this one is mine.
Bernie Ecclestone that is, owner of the FIA (Formula 1)
"Could this be the beginning of dismounting the legacy system of exclusive distribution rights awarded to one company in one state?"
I would hope it would be the beginning of the legacy system dismounting the fans so they can have a break from being on the bottom in this situation.
Or did the OP mean to say "dismantling" ?
Btw, this is *not* a free market solution because it is the government imposing a restriction on what may be agreed upon between consenting parties.
The whole concept of a ban on unauthorized decryption of satellite transmissions is a government-imposed restriction anyway.
The nfl offered it to cable systems but they did not put the funds to buy it But also the NFL wanted to be open to as much as the USA as they can so cable only would of been a no go more so back when it came up lot's of systems / in demand did not have a lot of room and some cable systems did not even have to room to fit in all of the MLB EI/ NHL CI / MLS DK/ and NBA LP channels. Also fox, nbc (before fox had NFL games) and cbs had say when it got started and they did not like it as NFL broadcasts are the ratings drivers for the networks' local affiliates.
But in Canada the law says you can't have exclusive stuff like NFL ticket so it's open to any system.
http://sports.espn.go.com/espn/page2/story?page=easterbrook/071030
It also turned out that before digital cable, most cable carriers lacked the bandwidth to show multiple viewer-elected channels simultaneously, so in the 1990s, Sunday Ticket probably couldn't have gone on cable anyway.
In 2002, the DirecTV exclusive on Sunday Ticket expired. By then, digital cable was on the horizon and Sunday Ticket was widely expected to shift to cable. The cable carriers wanted games sold individually, pay-per-view. The league wanted an all-encompassing package,
A power struggle ensued, with the big egos in the executive suites of the cable carriers essentially saying, "We'll decide how to market your games." This not only offended the big egos in the executive suites of the NFL but was totally different from the league's traditional partnership relationships with the broadcast networks and ESPN. In the background, the cable carriers were jockeying against each other to start their own sports networks and were angered by rumors the NFL would found what became NFL Network. In December 2002, the league gave the cable carriers a deadline for an offer for Sunday Ticket; the deadline passed, so the league re-upped with DirecTV; the cable carriers then presented a too-late offer and issued press releases denouncing the league for not waiting.
There is nothing more anti-capitalist than the exclusive contract. It's about time that the concept of the exclusive contract start to be found as the anti-competitive beast that it is.
It sounds good, but the ruling has loopholes you could drive a bus through. Specifically, while the match itself cannot be subject to exclusivity agreements, any copyrighted material (theme tunes and title sequences before the ad breaks, the little logo in the bottom right of the screen, the commentary, etc.) can still be controlled as the copyright holder wishes.
Bits and bytes are not durable either but they sell them, too.
Obama's legacy: (N)othing (S)ecure (A)nywhere and (T)error (S)imulation (A)dministration
On the bright side (if you can call it that), the EU ruling could effectively give Sky satellite the ability to be the sole provider of English football league. I think it is more realistic that the EU ruling means that all satellite providers will now pay the same price regardless of their primary coverage area. So it may be more of a win for English football league.
These comments are my own and do not necessarily reflect the views or opinions of my employer or colleagues...
Broadcasting has no borders. This is the juridic proof of it.
It is about football (for now)- but it has much wider implications.
For other sports, yes, but this has the ability to change how the whole information distribution across Europe changes.
Now Europe, for TV distribution sake, is one. What shows in Greece can be shown in England- What shows in Germany can be shown in Spain.
Local broadcasters cannot hold a monopoly on individual countries on anything. This could eventually turn into a big euro-fight of the media distributors and we could see a lot of mergers and aquisitions- and big european-wide media giants emerge.
"That's the way to do it" - Punch
Err, actually I think the most likely outcome is sporting rights only being sold to companies who are rich enough to buy the global - or pan-European - rights. That probably means Murdocjh and a few others and it probably means that they will be able to beat the sporting bodies down in price since there will be so few broadcasters able to afford global rights. ... I suppose Eurovision might be able to bid as a cartel.
One Distributor to rule them all?
Indeed. It's already been said that quick solution is to simply put a copyrighted watermark somewhere in the video. Voila, it's exempt from the ruling.
Just to supply some more information:
The EU Treaty establishes four fundamental "internal market freedoms" which are the free movement of goods, services, people, and capital within the EU, without regard to national borders.
Article 28 of the Treaty affirmatively prohibits "quantitative restrictions" on trade. The court in du Roi (Procureur du Roi v Dassonville (1974)) found a "quantitative restriction" to be anything "capable of hindering, directly or indirectly, actually or potentially, intra-community trade." That's a very broad definition.
Article 30 exempts "Industrial Property" -- so, patents as defined under the Paris Convention -- but not copyrights under the Berne convention. If I recall correctly, that argument had been tried, and the Court found that the distribution right under Berne was curtailed by the prohibition on artificial partitioning of the markets under the EU treaty.
So overall it's not hard to see why the court would find such an exclusivity agreement to a single nation to be invalid.
A preposition is a terrible thing to end a sentence with.
That's fine. Those elements are not part of the event. The pool feed which already exists to feed the various broadcasters does not have that. Now, if they start eliminating pool feeds, then you have a problem. I suspect the court would quickly address that as well.
Well, these "exteme economic liberals" might have a point.
Sports are so broadly popular and such a part of public life and politics that I don't generally think of them as "private" business. But they are privately owned.
It seems a little unlikely that they'd make more money with exclusive licensing than with open competition, but I guess that's their business.
Well, these "exteme economic liberals" might have a point.
Sports are so broadly popular and such a part of public life and politics that I don't generally think of them as "private" business. But they are privately owned.
It seems a little unlikely that they'd make more money with exclusive licensing than with open competition, but I guess that's their business.
OK, I'm lost here - economic liberals? What what?
The tendency toward monopolies or collusion I mostly associate with conservatives, those in big business where the need to make huge wads of cash trump the rights of the masses. They've corrupted sports to the point the games have modified their schedules and how the game is played (TV time-outs) to best benefit revenue production.
Exclusive rights to a territory means the broadcaster can charge high advertising rates, stick the viewers with whatever pundits they feel like and rake in the money. Sadly, the Football Association of England (FA) have happily gone along with this because they get a cut of it, which they claim helps fund development of sports, etc.
Consider if you will: Two (or more) broadcasters carrying the same match to the same market and each making revenue based upon which delivers the best product - better pundits, better camera work, better replays, whatever. It's the business model they don't want to contemplate, because it means they'd have to work for the money, rather than have laws which guarantee them a market.
By definition a Conservative wants to preserve the Status Quo, while a Liberal wants to challenge it. So who is the Liberal and who is the Conservative?
A feeling of having made the same mistake before: Deja Foobar
Interestingly, taking liberalism to its logical conclusion, and taking conservatism to its logical conclusion, both can lead to about the same place.
Try the quiz: http://www.theadvocates.org/quiz
Not really, it's an equivocal use of the word "free."
Economic liberals put an emphasis on the free market in the sense of the technical, economic use of the term by economists. They describe markets where any consumer can purchase a good from any supplier. Exclusivity agreements, by their very nature, erode free markets in the economic sense.
But there are also some political liberals (specifically of the libertarian bent) that put so much emphasis on the freedom of individuals that they believe that individual consumers and producers should have the freedom to enter in exclusivity agreements regardless of their impact on free markets.
Regardless of location or type, organised sport is by definition, corrupt.
Broadcasters do their own commentary, and they could replace all the other things with their own logos, theme tunes etc.
No, by definition Liberal means Free and a Liberal is someone that wants to achieve it. You're just confused by the fact that Social Liberals are in opposition to Social Conservatives.
A Social Liberal is someone that believes that in order for people to be free the government has to guarantee certain rights (Exactly which ones can be debated, but you're probably used to seeing ones like access to education and healthcare).
An Economic Liberal is someone that believes that in order for people to be free the government has to guarantee freedom of transaction(Free Market).
Liberalism as a whole contains both of these elements and can be balanced various ways. Libertarians and Democrats are both Liberals, they're just approaching the same thing from opposite directions.
You might want to read up on what Liberalism means, you can start at Wikipedia:
http://en.wikipedia.org/wiki/Liberalism
The television station's choice of pundits & commentators is pretty easy to get around. I know of a radio station that encourages their listeners who have Sky Sports to watch the games on it muted, while listening to them on the radio. Many people do.
The English league will now lose some of the monetary advantage it had because Sky will have to compete with cheapo-European networks.
Or, rather, because it will have to sell to other networks at the same prices per viewer (or somesuch, I don't know how such contracts work) and have lost their ability to price-discriminate between markets with different price sensitivities. Sky would then no longer be competing with cheapo European broadcasters because they'd become similarly expensive European broadcasters....but that reduces the total money taken for customers because, one presumes, Greek viewers are more price sensitive in this market and so the optimal price in Greece is lower than the UK.
I suspect that the result will be that UK prices fall very little, European prices rise to almost match it (people will pay a little more to have it in English, I suppose), fewer Europeans will watch English football and less money will be taken overall.
If copyrights and patents are not property, then what does property mean other than a transferable state-backed right to exclude people from doing something specific?
The Olympics is where I find the exclusivity most annoying. When I lived in the US it really annoyed me that the BBC olympic coverage was blocked and the same is the case now that I live in Canada (although it is less noticeable since the summer olympics has fewer Canadian athletes so they have more international coverage and the winter olympics has very few British athletes so I'm not missing much!).
Obviously local TV coverage will focus on the local nation's athletes - that's what 90+% of people will want so it makes perfect sense. So why not allow other nations to make their coverage accessible worldwide so those living in other countries can keep up with their home nations? While this ruling will no doubt help it would be even nicer if the Olympic organizers could possibly stop running after all the money they can grab and start remembering a few of their ideals like bringing the world together, not dividing it up.
That's why I called them extremist. Most reasonable people consider a free market a market where well informed consumers can purchase goods in a competitive market.
OK, I'm lost here - economic liberals? What what?
In Europe (and most other parts of the world), "liberal" means "no regulation". So social liberal is someone who wants government to get out of the nation's bedrooms, and economic liberal is someone who wants it to get out of the nation's wallets.
The whole notion of "liberal == left" or "liberal == !conservative" is, by and large, specific to North America.
Also see:
http://en.wikipedia.org/wiki/Economic_liberalism
http://en.wikipedia.org/wiki/Classical_liberalism
(and no, I'm not a liberal)
I think that is how it used to be. The Sky monopoly on English football has already been broken up once before.
I act agnostic toward natural rights until "what are the natural rights?" has a solid answer. Answering that question would make it straightforward to answer the question "which restrictions should the government impose to prevent people from infringing others' natural rights?". And if you think about it a moment, you'll probably realize that all political disputes come from a disagreement over what the natural rights should be.
Nonsense. This rule would just as much forbid Spanish clubs from making exclusive deals.