EU backs fans watching soccer on cheap decoders
Soccer fans in the European Union should be allowed to pick the cheapest way to watch games on television regardless of exclusive national broadcasting agreements, the EU's highest court ruled Tuesday.
The decision against England's Premier League - the world's richest soccer league - could have profound implications for how sports and other entertainment TV rights are sold in Europe.
Experts warn, however, it could be a short-lived Pyrrhic victory for European consumers, as the Premier League and other highly coveted leagues could push through pan-European packages at high rates, hurting fans in smaller markets.
They said it also could force a drastic revision in how TV programs are distributed throughout Europe's lucrative market of over 500 million people.
The European Court of Justice said it is ''contrary to EU law'' for rights holders to set up exclusive contracts for each EU nation and to seek to prohibit viewers from watching those games with a cheap decoder card from elsewhere in the EU.
Karen Murphy, landlady of The Red White & Blue pub in Portsmouth, England, started showing soccer games to her patrons using a Greek decoder, which cost her about one-tenth of the price she would have had to pay the Sky broadcasting network, which holds the British rights.
After an initial conviction, a British high court sought EU advice and the Luxembourg-based tribunal said in a statement that ''national legislation which prohibits the import, sale or use of foreign decoder cards is contrary to the freedom to provide services and cannot be justified.''
The Premier League said the dense 32-page judgment was too tough to come to immediate conclusions.
''We will take our time to digest and understand the full meaning of the judgment and how it might influence the future sale of Premier League audiovisual rights'' in Europe, it said in a statement.
The decision could force through pan-European contracts as the business model, a sea change compared with the compartmentalized, national way of contracting now.
''It could have a dramatic impact on the marketing of sports rights,'' said Munich sports law expert Peter Duvinage.
Major rights holders like the Premier League might now look at the future and weigh the limited added value of a contract in Greece with the threat it now poses to its core home market in the U.K.
''If I am doing Premier League, then of course, why risk the prices in Greece becoming the prices in Britain. I will make sure that I do one deal,'' said Nick Bitel, the chairman of the Sports Rights Owners Coalition in London. ''Consumers will find that they will have less choice.''
The Premier League is by far the richest soccer league in the world. The latest three-year domestic broadcasting rights deal alone raised 1.782 billion pounds ($2.75 billion).
The Premier League said it will ''continue to sell its audiovisual rights in a way that best meets the needs of our fans across Europe and the broadcast markets that serve them but is also compatible with European law.''
One part of Tuesday's ruling did go against the pub owner.
For transmission in pubs, a lucrative part of the TV rights business, the court said certain parts like the opening video sequence, Premier League anthem and or certain graphics would need authorization from the author of the works.
''We are pleased that the judgment makes it clear that the screening in a pub of football-match broadcasts containing protected works requires the Premier League's authorization. Currently only Sky and ESPN are authorized by the Premier League to make such broadcasts,'' the Premier League statement said.
Since the EU advice still has to go back to the British court, many warned it was still tough to assess the potential implications of the ruling on the lucrative European TV market.
For years, the 27-nation EU has been working to turn the territory of its member states into on open market unburdened by the commercial borders that hurt continent-wide trade in the past.
The court said the practice of selling rights on a country-by-country basis and keeping cheaper alternatives out of other member states as a blatant infringement on that principle.
But a broader market does not necessarily mean a cheaper market, since it might become dominated by only a few media behemoths from Europe's most populous countries with little regard for the cultural quilt that is Europe.
''As a result of that, I don't think will be competition driving the prices down. What you will find is that it is likely that the result will be that it will drive prices up,'' said Bitel.
If the ruling ultimately means the full pan-European selling of TV rights, ''the likes of the Skys and the ESPNs in sports will clearly be the winners and it won't be the national broadcasters,'' Bitel said.