Sports streaming apps sweat as Prasar Bharti makes a big move

While Prasar Bharati has not explicitly stated whether sports will be featured on the proposed OTT (over the top) service, private broadcasters fear that mandatory sharing of sporting event feeds could severely diminish their ability to make money from sports rights.

A top executive at a broadcast network, on condition of anonymity, said that if sports broadcasters are forced to share the digital feed of live sports events with this OTT platform, it would be the end of sports broadcasting.

“Sports rights are sold at a very high premium today because they are the only events which command appointment viewing and male audiences,” the executive said. “Naturally, they generate significantly higher ad revenue per rating point delivered. If the same games are shared on DD’s OTT platform free of cost, you can bid adieu to all the monetisation.”

In 2022, Disney Star committed $3 billion for four-year rights (2024-2027) to the International Cricket Council’s (ICC’s) tournaments, while Viacom18 secured media rights for the Board of Control for Cricket in India (BCCI)-run international and domestic matches for ₹5,963 crore over the next five years.

“While both Viacom18 and Disney Star are currently streaming sports for free on their OTT apps for mobile users, there might come a time when they would want to charge a subscription fee,” said another broadcaster, also requesting anonymity. “But if the same games are also streamed live on DD’s OTT service, why would anyone pay these private broadcasters?”

Sources familiar with Prasar Bharti’s plans indicate that the platform aims to curate a wide range of content, including news, entertainment and, potentially, sports.

An email query sent to Prasar Bharati remained unanswered till press time.

The Need for a Public OTT Platform

Prasar Bharati’s move follows recommendations from a parliamentary panel in May 2023, which emphasised the need to regulate content on private OTT platforms to ensure it respects the cultural sensitivities of the country. The panel’s stance was reinforced by the blocking of 18 OTT platforms under the Information Technology Act, 2000, due to concerns about “vulgar and obscene” material.

While pointing out that the public broadcaster’s move is aimed at addressing growing concerns on private OTT platforms’ content, Kaushik Moitra, partner at law firm Bharucha & Partners, agrees with private sports broadcasters’ concern. 

“Sports broadcasters are required to share signals of nationally important events with Prasar Bharati for retransmission,” said Moitra. “The relevant law provides rights over DTH (direct-to-home) networks but does not explicitly mention OTT platforms or streaming services, which would need to be brought under its ambit to address this.” Moitra added that this may put sports broadcasters in a “vulnerable place”.

What the Notification Says

In its latest notification of 2022, the ministry of information & broadcasting has notified all Olympics Games, Commonwealth Games, Asian Games, and specified events relating to cricket, tennis, hockey, football, badminton, kabaddi, Khelo India games, and other events relating to shooting, archery, and international events organised by National Sports Federations recognised by the Union government as games of national importance.

In cricket, this includes all official one-day, twenty-20, and test matches played by the Indian men’s and women’s cricket teams and all ICC test matches featuring India.

In March 2007, the parliament passed The Sports Broadcasting Signals (Mandatory Sharing with Prasar Bharati) Act, 2007, to provide access to sporting events of national importance to the largest number of listeners and viewers, on a free-to-air basis.

As per the act, no content rights owner or holder and no television or radio broadcasting service provider shall carry a live television broadcast on any cable or DTH network or radio commentary broadcast in India of sporting events of national importance, unless it simultaneously shares the live broadcasting signal, without its advertisements, with Prasar Bharati to enable them to re-transmit the same on its terrestrial and DTH networks.

However, the Supreme Court, after hearing a case between Prasar Bharati and Star India, said in its verdict in 2017 that Prasar Bharati cannot share the feed it gets from rights owners such as Star on channels, which are carried by cable operators and private DTH platforms. 

In other words, the free-to-air feed can be shared on a channel available only on terrestrial or Prasar Bharati’s free-to-air platform, DD Free Dish.

The problem with OTT

Broadcasters argue that while the linear transmission of shared feed on FTA doesn’t eat into their viewer base, the same cannot be said for an OTT platform.

The move, many say, can also impact sports’ governing bodies, including but not limited to the BCCI, which earns its lion’s share of revenues from selling the sports rights.

Incidentally, BCCI secretary Jay Shah has announced a cash award of ₹125 crore to the Indian team after the men in blue won the ICC T20 World Cup in Barbados last week. 

When asked if the board would be able to spend money like this if the broadcasters were forced to share the streaming feed, a BCCI official told Mint that the board has not heard any concern related to streaming on DD’s OTT from any private broadcaster as of now, while adding that they were all busy with the World Cup.

“While we may not have a direct say in the matter if broadcasters are unable to monetise the sports rights, it will affect their bidding power, which in turn will reflect in the revenues of not just the BCCI, but all the sporting bodies,” the official said.

It is important to note that the Indian Premier League (IPL), the cash cow of the BCCI, is not part of the games of national importance. In 2017, the I&B ministry wanted to bring IPL also under the purview of the mandatory sharing clause but received serious pushback from the then rights holder Star India, which had picked up the five-year rights (2018-22) for ₹16,347.5 crore. Later, the sports ministry also refused the proposal from the I&B ministry.

“If the IPL was put under games of national importance, the BCCI would not have been able to sell the rights for ₹48,000 crore for the next cycle,” said a former sports broadcast network CEO.

For the 2023-2027 cycle, Reliance Industries-controlled Viacom18 trumped Disney Star to win the digital rights of the IPL for ₹23,757 crore, while the latter retained the linear TV for ₹23,575.

What’s the Direction?

Apart from sports, private broadcasters are also puzzled about the proposed OTT’s strategic direction — will it operate as a public broadcaster-OTT or hybrid or adopt a purely commercial model?

One of the persons cited above said that Prasar Bharati will likely offer the first one to two years of subscription completely free to reach a wide audience and emphasise the importance of Indian culture.

Earlier in May, Prasar Bharati sought comments from private broadcasters on carrying linear or live channels on the forthcoming OTT Platform. 

In the letter to the broadcasters, Prasar Bharati stated, “To remain future-ready and increase its footprint in the rapidly changing broadcasting industry, Prasar Bharati has extended its reach in the digital domain by developing an OTT platform. A diverse range of content available with Prasar Bharati in multiple languages and dialects shall be made available in digital format catering to the varied tastes and preferences of the audience. The OTT platform of Prasar Bharati shall represent the rich socio-cultural diversity of the nation, bringing family viewing of TV back. The Platform may be launched in July 2024.”

It mentioned that the platform will have provisions for linear TV channels with advertisement-supported functionality like inserting or replacing video advertisements in a fully automated manner.

Recent Developments

Last month, a meeting was called by Prasar Bharati CEO Gaurav Dwivedi, where representatives from major broadcasting networks including Disney Star, ZEE Entertainment, Sony Pictures Networks India, Viacom18, ABP News, TV9, TV Today, Times Group, NDTV, B4U, India News, and Aastha Group, discussed the placement of linear channels on the DD OTT platform.

During the meeting, some broadcasters asked about sports streaming, to which the public broadcaster did not give a definitive response, said one of the persons who attended the meeting. “The CEO indicated the platform would be both ‘premium’ and ‘ad-based’, covering all genres,” he said.

During the meeting, a news broadcaster pushed for mandatory free carriage of news channels, while other broadcasters sought a “free ride”. Prasar Bharati said it is open to suggestions on the platform’s business plan and is exploring geofencing options.