In what appears to be another high-profile commercial dispute emanating out of the world of cricket, the Supreme Court has stayed the Delhi High Court order barring PrasarBharati from sharing the live feed of ICC Cricket World Cup 2015 with cable operator through Doordarshan and other affiliated channels. The Court has also asked ESPN and Star to search for alternative proposals to this fracas which has the potential to cause severe losses to these telecasting companies. The Attorney General is to be notified and provided with an advance copy of these proposals.
The Delhi High Court judgment of 4th February interpreted the Sports Broadcasting Signals (Mandatory Sharing with PrasarBharati) Act 2007 to hold that PrasarBharati is only authorised to share on terrestrial TV (not cable TV), the live feed of sports events provided to it by private broadcasters under the mandatory provisions of the Act. The private broadcasters had objected to PrasarBharati telecasting the live feed on cable TV as it severely hindered the ability of content owners/licensees to monetise the content, as the Doordarshan channels were free. Private players had to obtain a separate license from content owners to telecast the sports content exclusively owned and showed by PrasarBharati. On the other hand, PrasarBharati had been sharing the sports content owned by these broadcasting companies, to their alleged financial detriment, with private cable network operators, giving rise to the dispute. However, the Delhi High Court had shot down the challenge to section 3 of the Sports Act, which makes it mandatory for private telecasters to share the live feed of sports events of national importance, with PrasarBharati. The prayer to strike down a 2000 notification of the PrasarBharati which had made it mandatory for cable operators to carry DD channels, was also not entertained.
The Central Government and PrasarBharati had moved the Supreme Court against the Delhi HC order, with the Attorney General, MukulRohtagi arguing that the High Court verdict was against the mandate of the Sports Act and Cable TV Network Act apart from being in conflict with public interest.
ESPN and Star, represented by P. Chidambaram and KapilSibal submitted before a Bench headed by Justice RanjanGogoi that the dispute had been on-going since 2007 when Nimbus had the rights to all series organised by the BCCI and has the potential to cause severe loss of revenue in two different ways; the first through the reduction in advertisement revenue and the second thorough the reduced subscription revenue. Those homes, which were connected via cable networks would have paid for receiving the live broadcast signals had PrasarBharati through Doordarshan not provided the same free of cost to the cable operators.
The advertisement revenue received by Doordarshan with respect to the shared content of sports channels is required to be share in the ratio of 75:25 by virtue of section 3(2) of Sports Act. However, the High Court had observed that the sharing of advertisement revenue could not compensate for the loss of subscription revenue. The advertisement revenue, which ESPN / STAR would have made on its own, would not be matched by PrasarBharati and, therefore, the provision of Section 3(2) of the said Act was no consolation for providing the feed free to the cable operators.