Openview slaps back
eMedia has hit back at MultiChoice’s argument that Openview is merely looking for a taxpayer-subsidised “free ride” to broadcast the Rugby World Cup.
MultiChoice and eMedia are meeting in court on Tuesday morning after the E-tv and Openview owner filed urgent court papers at the end of last month.
eMedia bought full-page ads in the Sunday Times, Rapport, and City Press this past weekend to announce that it had taken legal action against MultiChoice over restrictions MultiChoice placed on a sublicensing deal with South Africa’s public broadcaster, the SABC.
SuperSport, a MultiChoice subsidiary, licensed the exclusive rights to broadcast the Rugby World Cup in South Africa.
MultiChoice SA CEO Marc Jury said in their answering affidavit that they reached a last-minute deal with the SABC to broadcast 16 matches live, including every Springboks game.
The SABC reportedly raised $3 million (R58 million) to pay for the rights from three sponsors — Castle Lager, Hollywoodbets, and Pineapple.
Jury said they helped facilitate the last-minute approval of these sponsors with World Rugby.
However, the sub-licence prohibited the SABC from airing matches on third-party platforms it doesn’t own, like the eMedia-owned Openview.
In their answering affidavit, Jury argued that eMedia had every opportunity to bid for the 2023 Rugby World Cup rights themselves when World Rugby invited broadcasters to do so in 2018.
eMedia could also approach MultiChoice directly for a sub-licensing deal.
“eMedia’s case is a classic example of free riding — seeking to profit off another’s expense without contributing at all,” stated Jury.
In their responding affidavit, eMedia CFO Antonio Lee said MultiChoice’s argument reveals a fundamental misunderstanding about their application.
He said eMedia is not seeking to broadcast the rugby matches on any of its channels, whether E-tv or any other “eChannel”.
“All that eMedia seeks is to carry the full content of the SABC channels on the OpenView platform, in accordance with its contractual entitlement in terms of the agreement with the SABC,” Lee stated.
Lee said in this context, Openview is simply a carriage operator facilitating the distribution of the SABC’s channels.
“Nor will eMedia gain any revenue from the broadcasting of the matches on SABC2 from advertising, sponsorship,” said Lee.
“If the matches are shown on SABC2, all advertising revenue and sponsorship will accrue to the SABC.”
Marc Jury, MultiChoice SA CEO and Showmax acting CEO
However, Jury (MultiChoice) contended that removing the third-party restriction from its deal with the SABC would have altered the price.
He explained that SuperSport had paid a substantial sum to secure the exclusive rights for DStv to broadcast the Rugby World Cup.
In essence, this helped increase the value of DStv Premium and would hopefully drive uptake of the service.
MultiChoice has to recoup the value lost by sub-licensing its rights to free-to-air broadcasters like the SABC and eMedia.
To further argue the point, Jury explained that non-exclusive rights are worth much less.
“In MultiChoice’s experience, the value of broadcasting rights is likely to drop by approximately 80%, or more, when sold on a non-exclusive basis,” Jury said.
“For example, in 2019, SuperSport entered into a licence agreement to pay an amount for non-exclusive sports broadcasting rights, which was the equivalent of 14% of the price which it had paid for exclusive rights to the same sporting event approximately six years earlier.”
eMedia’s Group Executive for Legal and Business Affairs, Philippa Rafferty, told MyBroadband that this argument by MultiChoice is a red herring.
“SABC is paying for free-to-air rights, and the rugby should be available on all free-to-air platforms,” Rafferty stated.
“The rugby is available on SABC 2 on all other platforms in South Africa, including analogue, DTT [digital terrestrial television], DStv, StarSat and even OTT.”
OTT is short for over-the-top and refers to online video streaming services. SABC is showing the rugby through its SABC+ and SABC Sport streaming websites.
“To suggest that SABC needs to pays more to show it on Openview does not make sense as there is already no exclusivity in the rights being on Openview,” Rafferty argued.
“The only conclusion we can draw from MultiChoice and SuperSport’s restriction on Openview is to damage the goodwill of eMedia and the Openview platform.”
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