Is this the end of sports content over the internet?

This article was first published in the April 2008 issue of Sports Business International.

For years television was the only means of delivering sports programming to fans with the content almost exclusively restricted to the most popular sports such as football and rugby. 

Times have changed.  The rapid expansion in the use of the Internet and the uptake of  broadband has caused a dramatic increase in the availability and accessibility of  sport content. 

Sites such as Manchester United’s MUTV Online and Tottenham Hotspur’s Spurs TV Online now provide subscription-based access to live matches, highlights and interviews via their online ‘TV’ channels.  The relative ease and lower costs of  storing, delivering and publishing video content online  provides a platform for niche sports which have traditionally struggled to find a slot in the programme schedules of major sports channels.  For example, The Professional Squash Association gives its fans unprecedented access to content through psalive.tv, and, in turn, helps to further popularise the sport.  

These websites are currently free from television regulation, despite many being what could be described as ‘TV-like’.  This could soon change following the adoption of the controversial Audio Visual Media Services Directive (AVMSD).

When the World and TV was Flat

In 1997, when the Television Without Frontiers Directive (TWFD), which regulates television in the UK through the Communications Act 2003, was last amended, television was exclusively delivered into homes via free to air analogue signal, cable or satellite through scheduled broadcasting (so called ‘linear’ television).   

Providers of linear television bear the cost and hassle of compliance with the TWFD However, no level playing field exists because the increasingly popular on-demand services, whether provided via satellite, cable or the Internet, are not currently subject to TWFD.   

The New World

To rectify this bias, on 19 December 2007 the European Commission adopted the AVMSD.  The AVMSD, which amends the TWFD, aims to regulate media services independently of the platform on which they are delivered, thereby removing any disadvantage to linear television.  As a result, the AVSMD introduces regulation for ‘on-demand audiovisual media services’ and makes it clear that broadcasts over IPTV will be regulated going forward.

The scope of these new ‘on-demand audiovisual media services’ is potentially very wide, covering any video content which can be chosen by a user from a catalogue of programmes organised and selected by the service provider.  This definition may be broad enough to capture many of the sports teams and organisations currently providing content over the Internet.   

UK Implementation

The AVMSD is due to be implemented into UK law in the next eighteen months.  It looks likely that it will take the form of new legislation and that the Association for Television on Demand (ATVOD) will regulate on-demand services.  Ofcom, which regulates television, will co-regulate with ATVOD, retaining backstop powers to step in if necessary.

Ofcom has made it clear that although the AVMSD appears to cover a wide variety of Internet material, it only intends to regulate audiovisual material that ‘looks and feels’ like traditional television. 

But what does ‘look and feel’ like television mean?

It appears that sports organisations/teams providing access to content on dedicated ‘web-channels’ will almost certainly fall within AVSMD. 

In contrast sports content made available on a small, non-commercial basis is unlikely to be caught by the AVMSD. 

Problems will arise in between these two extremes where the issue becomes blurred.  For example, ad funded content suggests that the content is provided on a commercial basis but it may be necessary to look behind the inferences and consider the  intentions of the provider.  Is the content being provided on a commercial basis?   

Only once each member state has implemented the AVMSD will we have a clearer idea of where to draw the lines. 

The New On-Demand Obligations

The good news, for now, for those providing sports video services over the Internet is that regulation of these on-demand services will be lighter than for television broadcasting but will still require some changes.

Of most relevance to these providers will be the new qualitative rules on advertising, sponsorship and product placement which are likely to be similar to those currently in existence for traditional TV. 

Websites will need to provide protection for minors and provide access to people with visual or hearing disability. 

Sites will also be required to promote the production and access to European works (which will be difficult to enforce in practice) and not to incite hatred based on race, sex, religion or nationality.  In reality these requirements should not prove too demanding.

The Future?

There was understandably significant concern over the regulation of on-demand services but after intense negotiations and revisions, the European Commission came down on this low level of regulation.  

Given the speed of technological development, it may not be too long before on-demand services surpass linear TV and further regulation may then be needed.  However, the voluntary nature of on-demand consumption ought always to weigh against extending regulation. 

The mere existence of regulations may make the provision of online content less cost effective or attractive.  It would be negligent if in the future, the availability of sports content is again limited.  

Sports organisations can apply pressure to ensure that the rules are clear and as sympathetic as possible as there are consultations and opportunities to lobby the UK government this year.

For further information, please contact Lewis Cohen or John Brunning.