DCMS Free to Air Events Review - a full match report and a look ahead to next season

Published 23 February 2010

David Zeffman, a Partner in the Media, Communications and Technology Group and Head of Sport at Olswang, summaries the key issues surrounding DCMS Free to Air Event Review.

Introduction – the current position and the Government's Consultation

 The current protected list of events, which has been in place since 1998, is shown in the table below. The list ensures that Group A events must be offered for sale on fair and reasonable terms to all broadcasters and cannot be offered on an exclusive basis. Group B events may not be broadcast live on an exclusive basis unless adequate provision has been made for secondary coverage (highlights or deferred coverage).

Group A Events

Group B Events

The Olympic Games

Cricket Test Matches played in England

The FIFA World Cup Finals Tournament

Non-Finals play in the Wimbledon Tournament

The European Football Championship Finals Tournament

All Other Matches in the Rugby World Cup Finals Tournament

The FA Cup Final

Six Nations Rugby Tournament Matches Involving Home Countries

The Scottish FA Cup Final (in Scotland)

The Commonwealth Games

The Grand National

The World Athletics Championship

The Derby

The Cricket World Cup: the Final; the Semi- Finals; and matches involving Home Nations' teams

The Wimbledon Tennis Finals

The Ryder Cup

The Rugby League Challenge Cup Final

The Open Golf Championship

The Rugby World Cup Final


DCMS' consultation on free-to-air events, which closed on 3 July 2009, essentially asked three questions to respondents: 1) should listing continue; 2) is the current criterion for listing correct; and 3) which events should be listed?


Stakeholders' interests

The Panel's aim, set out in the Consultation, is to "strike the right balance between everyone's interests". The four key stakeholder groups whose divergent interests must be balanced are (i) the viewing public, (ii) sports governing bodies, (iii) free-to-air broadcasters and (iv) pay-TV broadcasters. However, with public support at a low ebb, and a General Election looming, the likelihood of the Secretary of State making a decision that is unpopular with the public seems remote.

The Public

Most members of the public, when asked whether they would prefer to watch sport on a free-to-air channel rather than have to pay for it, would clearly answer "yes". However, this does not necessarily mean that it is in the interests of the public to maintain or expand the current list of protected events.

As well as the cost of watching an event, most viewers would also be interested in the quality and comprehensiveness of the coverage, and the competitiveness of the individuals or teams they are supporting.

Even with the advent of digital and online television distribution, free-to-air channels do not always have the space in their schedules, nor the budget, to show comprehensive, high quality coverage of multiple sporting events. Pay-TV broadcasters such as Sky have dedicated channels, allowing them to provide broader coverage of more events.

In general, the sports' governing bodies would also argue that by increasing competition for their rights between free-to-air and pay-TV broadcasters, they can obtain higher rights fees. This allows them to invest more money into their sports and thereby increase the competitiveness of the individuals and teams they represent, which is in the interests of the public.

Nevertheless, any decision to abolish or reduce the protected list is likely to be unpopular with the public who would probably prefer to see additional sporting events added to the list.

Sports' Governing Bodies

Most sports' governing bodies would prefer to see their sports absent from any list of protected events. They would instead prefer a free market into which to sell their media rights, giving them the discretion to market their rights in the way they consider best, increasing competition and potential rights fees. These higher fees could then be reinvested into the sport, improving coaching and facilities for young participants as well as the financial rewards for elite players. For example, the ECB has used its extra revenue from Sky to invest over £12 million per year into grass roots cricket, including training 13,000 coaches since 2007.[1]

However, seeking the highest bid is not the only consideration for governing bodies. They must also consider the additional exposure that free-to-air television brings to the sport. Increased viewership is certainly likely to result in increased sponsorship revenue, and arguably this also increases participation at a grass roots level. Ultimately, though, the governing bodies probably feel that they are the right people to decide what is in their sport's best interests, not the Government.

Free-to-air Broadcasters

The meaning of "free-to-air" for the purposes of the protected list is that no payment needs to be made for reception beyond the normal TV licence fee and the cost of receiving equipment, and that the broadcast is capable of reaching at least 95% of the UK population. Currently only the BBC, ITV, Channel 4 and Five have that free audience reach.

It is in the interests of these broadcasters that the list of protected events remains in place, and is perhaps expanded. They know they only have to bid against each other for the rights and, whilst they are obliged to pay a "fair and reasonable" price[2], this price should be offered by the governing body on the basis of what the relevant category of broadcaster could reasonably be expected to pay[3]. This makes it easier and cheaper for the BBC to fulfil its public service obligation to "have regard … for the need for appropriate coverage of sport". If an event is taken off the protected list, the likely result is that free-to-air broadcasters would have to pay more to win the rights to show it. In response to this argument, Sky has (in its submission to the Panel) described the current system as a tax on sports governing bodies, which further subsidises free-to-air broadcasters.

The free-to-air broadcasters can also rightly point to public support in their attempts to maintain the protected list.

Pay-TV Broadcasters

Pay-TV broadcasters would prefer to see the protected list abolished so that they are able to bid for any rights which interest them.

In support of this free market view, they can justifiably argue that their interests are aligned with those of the governing bodies, and also point to their ability to show more comprehensive television coverage. An example is Sky Sports' cricket coverage, which includes not only international cricket played in England, but also international cricket played overseas, county cricket, women's cricket and club cricket, which neither the BBC nor Channel 4 had the capacity to show. Furthermore, Sky is widely available in pubs and clubs and this offers another option to households that may not wish to purchase a subscription. Of course, this does not necessarily mean that the public would not prefer to see this summer's Ashes series on free-to-air television.

Should there be a protected list at all?

Listed events protection is based on the principle that there are certain events or entire tournaments that constitute "shared points on the national calendar". The legislation is in place to ensure that events like the Grand National and the FA Cup Final can be watched by as broad an audience as possible.

EU law, which allows for countries to designate listed events, does not make it mandatory to do so. Indeed, only 9 countries in the EU have protected lists at all – the rest leave it to the market.

The likelihood of the Government sanctioning an abolition of the protected list is remote, given the public outcry it would be likely to provoke.

The argument to be made for the retention and perhaps expansion of the protected list is obvious: more people get to watch more sport without having to pay more for it. That is of itself a good thing for the public, and may also stimulate more participation in sport at a grass-roots level.

Nevertheless, there is also a legitimate argument to be made for abolition, based on the financial disadvantages that the current system places on sports' governing bodies.

Further, just because an event is not on the protected list does not mean that it will not be shown free-to-air. There are a number of examples of non-listed events possessing a strong national sentiment which have thrived on free-to-air television without listed events protection. Free-to-air broadcasters understand their audiences and have exercised their discretion to compete against pay-TV providers to secure the best rights for their viewers regardless of whether events are listed or not. Examples of such coverage include:

· Champions League football rights, which are split between pay-TV and free-to-air (last year 21 million watched an all-English encounter which attracted great national interest)[4];

· FIFA World Cup matches in countries where there are no listed events (such as the Netherlands);

· Formula 1 races (20.1 million people watched Lewis Hamilton win the Drivers' Championship last year)[5]; and

· the BBC's live coverage of the whole of Wimbledon and the Six Nations, despite most stages only receiving Group B protection.

The governing bodies, as the stewards of their sports, have a self-imposed duty to uphold the popularity and reputation of their sports. To do so, they must balance the importance of increased revenues (which may or may not come from pay-TV operators) against the value of maximum exposure (which can be measured in sponsorship revenue as well as popularity). UEFA's sale of its Champions League rights is an excellent example of this, where rights are split between a pay-TV broadcaster (Sky) and a free-to-air broadcaster (ITV) to obtain an optimal balance between revenues and audience reach.

The FA; the Premier League; the Nationwide League; the Rugby Football Union; the Rugby Football League and the England & Wales Cricket Board are all signatories of the Major Spectator Sports Division of the Central Council for Physical Recreation (CCPR) voluntary code on Broadcasting, under which they each undertake to ensure to the best of their ability that highlights of their events are available on free-to-air television where live coverage is shown on subscription channels, and to invest at least 5% of broadcasting income in the development of their sports. In addition, the IOC mandates that at least 200 hours of each Summer Olympics (and 100 hours of each Winter Olympics) is available free-to-air, so viewers in the UK would be guaranteed free coverage of the Olympics event if there were no protected list.

A free market approach would be unlikely to lead to the unavailability of highlights on free-to-air television. As evidenced above, sports' governing bodies and free-to-air broadcasters understand the desire of the public to see at least highlights of significant sporting events on free-to-air television, and often choose to make highlights available free-to-air as a result. Highlights and delayed coverage is also far more affordable and easier to schedule for free-to-air broadcasters than live coverage. In the absence of a Group B list, free-to-air channels would be likely to continue to bid for the appropriate highlights coverage in accordance with their budgets. BBC 1's £170 million Match of the Day deal is a good example of a freely negotiated and highly in-demand highlights programme which, if moved to pay-TV, would cause public disapproval despite its non-listed status.

There is also an argument that the rationale for continued listed events protection is weakened by declining viewing figures. England's football World Cup win in 1966 attracted 27 million viewers; Ali vs Frazier (1971) attracted 27 million viewers, and Torvill and Dean's Bronze medal winning skate at the Lillehammer Winter Olympics in 1992 was watched by 24 million people.[6] Recently, the most popular sporting events have not attracted the same number of viewers.  The climax of the 2005 Ashes series on Channel 4 was watched by 8 million viewers[7]; the 2007 Rugby World Cup finals attracted 15 million viewers[8]; and 2008's epic Wimbledon final between Federer and Nadal was watched by 13 million viewers[9]. Compare this to the final of this year's Britain's Got Talent, which attracted 19.2 million viewers on ITV1[10]: no-one would argue that Britain's Got Talent should be on the protected list, so why should sporting events which, at least according to the viewing figures, have less "special national resonance"?

An additional point is that the protected list is being reviewed approximately every 10 years. This is perhaps not sufficient to keep pace with the market and changes in the popularity of certain events. For example, will the Twenty20 Cricket World Cup soon be more popular with viewers than either the 50-over World Cup or England Test Matches? Leaving these decisions to the governing bodies and the free market would allow more flexibility.

If the protected list is ever abolished, it could be replaced by lighter-touch regulation which is compatible with a free market for sports rights. For example, the public service broadcasters' public service obligations could be strengthened to include a minimum amount of sports coverage, and Ofcom could perhaps be given emergency powers to intervene if a deal were ever to be agreed where the public interest was significantly at risk.

Criterion for protection

Whilst the protected list is unlikely to be abolished, it is conceivable that it will change.

The essential criterion for whether an event should be on the list is:

The event has a special national resonance, not just a significance to those who ordinarily follow the sport concerned; it is an event which serves to unite the nation, a shared point on the national calendar.[11]

Whether this test is the correct one falls within the scope of the Panel's review.

Many members of the public and also the free-to-air broadcasters would argue that additional events that fulfil this criterion ought to be added to the list, such as live Ashes Test Matches or perhaps the Champions League final. Most supporters of particular sports would also be likely to oppose the removal of the main events in those sports from the protected list.

However, equally, it could be argued that many of the events currently on the list do not fulfil the essential criterion test, and on that basis should not necessarily be listed. The Ryder Cup; the Open Golf Championship; the Derby; the Rugby League Challenge Cup Final; the World Athletics Championships; the Commonwealth Games and the Cricket World Cup all had comparatively low viewing figures (between 3 and 6 million)[12] at the time of the last listed events review in 1998. The 2009 Derby was watched by only 2.8m people. It is arguable that most, if not all, of these events are principally significant only to those who ordinarily follow the sports concerned.

There is also a second category of listed events, which could be said to rely on circumstantial factors to achieve sufficiently high viewing figures to merit inclusion in the list, such as a British national team or individual performing well, or an epic contest. If these events are to be listed, sports governing bodies would probably prefer the protection only to apply to those matches in which teams or individuals from the home nations are involved. Examples include Wimbledon; the Olympics; the Rugby World Cup; the Football World Cup and European Championships. For example, the entire 2008 football European Championship finals tournament (31 matches) was a listed event, despite the fact that no home nations qualified. The game between Poland and Croatia, attracted just 435,000 UK viewers (a 0.9% viewing share). Some of the games were relegated to smaller digital channels to free up space for higher-rating programming, demonstrating the lack of "special national resonance". UEFA could have commanded a higher fee when selling the rights were it not for the listed events protection which was probably, in hindsight, unnecessary in the circumstances.

It is interesting that only the UK and Belgium protect the whole of the football World Cup and European Championships, as opposed to matches in which the home nation is involved. In both cases, FIFA and UEFA have challenged the European Commission's decision to approve the protected lists, on the basis that not all matches are of major importance to the Belgian and UK public, and this approach is anti-competitive.

There are, however, a number of events for which it is much easier to justify inclusion on the protected list, including the FA Cup Final (and the Scottish FA Cup final in Scotland); the Grand National; and British involvement in the Olympics. The argument for including specific events, such as the Olympic 100 metres final and the football World Cup final, even where there is no British interest, is also strong.

The effects of new technology

One of the reasons why viewing figures for sporting events are typically lower now than in the past is the increased choice available to viewers. The advent of multi-platform television and other viewing alternatives, such as television services delivered over the internet and even via games consoles, has led to a fragmentation of viewing habits. If a significant proportion of the viewing public choose to watch re-runs of Friends or Sex and the City instead of a major sporting event, this detracts somewhat from the argument that the event has a "special national resonance". The fact that many households have more than one television screen also means that whole families, let alone the whole nation, are less likely to agree that an event is a "shared point on the national calendar". In deciding whether there is to be a new test for listing events, the Panel will need to consider how to take this trend into account.

Advances in technology also detract from the rationale behind separating the protected list into Group A and Group B events. The idea behind the Group B list was to ensure that delayed or highlights coverage would be available free-to-air for certain events possessing national resonance but presenting serious scheduling problems because of their duration or the number of events involved. These events include the Rugby World Cup; Test Match Cricket; the Commonwealth Games; the Ryder Cup and the Open Golf Championship. The imminent Digital Switchover means that the perceived scheduling problems argument will be weakened: many of the free-to-air qualifying channels already have subsidiary digital channels which can offer full live coverage (ITV 4 is often used for Champions League coverage and the BBC's Red Button service is often used for snooker coverage, for example). David Davies has confirmed that these new digital channels may meet the free-to-air qualifying criteria after Digital Switchover.[13]

The increasing popularity of On-Demand services, which include highlights and delayed coverage of sport via television and broadband, will further increase the options available to rights holders and consumers. Whilst live television will remain important for viewing sports events, alternative viewing channels will increasingly become available. This gives sports governing bodies (and the Government) even more scope to ensure that the public is able to watch key events.

We will wait with baited breath to see who the points victory is awarded to in this heavyweight contest, but it the meantime the positive to be taken from these sensitive conflicting arguments is that that there is a significant interest in the future of British sport, and the 2012 Olympics and 2015 Rugby World Cup will only put more pressure on the Government; the rights holders and the sports' governing bodies to act in the public's best interests and come up with sensible solutions when it comes to negotiating broadcasting deals and shaping the future of televised sport in a digital age.


[2] Ofcom Code on Sports and Other Listed and Designated Events

[3] Ex Parte TV Danmark 1 Ltd [2001] UKHL 42

[6] The Independent, 20 November 2003

[10] Sunday Times, 7 June 2009

[11] Free-to-air Events Review Consultation, DCMS, April 2009 (originally taken from 1998 DCMS Consultation).

[12] The Advisory Group on Listed Events, Alternative Approaches to the Problem, Partial Listing and the B List.

Leave a comment

Please login to leave a comment.

Official partners 

BASL
Soccerex Core Logo
SLA LOGO 1kpx
YRDA Logo2
SAC logo LawAccord

Copyright © LawInSport Limited 2010 - 2018. These pages contain general information only. Nothing in these pages constitutes legal advice. You should consult a suitably qualified lawyer on any specific legal problem or matter. The information provided here was accurate as of the day it was posted; however, the law may have changed since that date. This information is not intended to be, and should not be used as, a substitute for taking legal advice in any specific situation. LawInSport is not responsible for any actions taken or not taken on the basis of this information. Please refer to the full terms and conditions on our website.