Is “free football” coming to a pay-TV market distorted by exclusive content deals?
That’s not a National Day joke. It’s one fierce promotional ploy that SingTel is announcing today, just days before the football season kicks off for fans here with the FA Charity Shield this weekend.
Basically, the “red” telco is dangling two months of free access to its football channels which show the Italian Serie A, Uefa Europa League and most importantly, the Uefa Champions League, to tempt you to sign up for a trial of its mio TV service.
This offer is open to both SingTel mio TV and mio Home customers til August 19. Oh wait, StarHub’s pay-TV sports group subscribers can also get on for a free ride – as long as they turn up at a SingTel shop with their identity cards and cable TV bills by the end of September.
The free channels will cease by the end of October, by which time SingTel hopes you’d be hooked to its menu of programmes that also include documentaries, children’s shows and American and Asian drama serials.
Though aggressive, SingTel’s move will not do much damage to StarHub, which still holds the most important football rights – indeed, pay-TV rights – in the Barclays Premier League (BPL) for another season.
Champions League matches, after all, are played in the middle of the night (starting at 3am to 4am Singapore time), and attract a niche diehard crowd. They are no substitute for the week-in, week-out, bread and butter of the BPL.
Yet, on the other hand, what’s there for SingTel to lose by offering up the first two months of Champions League action? This is when the early group matches are played, and they are nowhere as exciting as the latter stages.
Thus, with “free football”, SingTel is doing nothing more than 1) remind StarHub viewers they are around 2) take a pot shot at StarHub, which has been selling its BPL coverage as the “only one league that matters”.
For consumers, this kind of competition is not a sign of better deals to come. The spiralling costs of bidding for exclusive BPL rights will soon emerge for the upcoming seasons, as StarHub’s three-season rights come to an end next year.
Lest we forget, StarHub paid around US$150 million for the current three BPL seasons – three times more than before because the price was inflated by bids from SingTel as it entered the market as a pay-TV challenger. This time round, some experts expect the bids to top US$400 million – more than double the last sum.
It is understandable why SingTel and StarHub are bidding up the prices – both see pay-TV as the one differentiator in their “triple-play” of services. But who are paying the price for this type of competition? Unfortunately, consumers.
The Singapore regulator, the Media Development Authority (MDA), has only said it is considering the situation. In other words, it’s still sticking to its stance that the market will correct itself.
It is also worried that rights owners will keep out of Singapore if the regulator puts its foot down on the ridiculous bidding exercise that benefits only the rights owners. This argument doesn’t stand.
Firstly, the BPL is about money, and the rights owners would rather take less money in a StarHub-SingTel resale agreement than no money at all from Singapore (if they can’t get US$400 million, they will be happier with US$150 million than nothing).
Secondly, Singapore’s government regulators – and that includes the Infocomm Development Authority – need to see the bigger picture: StarHub and SingTel are simply going to use their fat profits from broadband and mobile services to fund this loss-making pay-TV enterprise, so as to keep their “triple-play” game going.
Where’s the level playing field? How is the market going to re-balance itself when it is propped up by money from other services in a fast-converging space? Unfortunately, there are no rules in Singapore against this type of bundling – at least not in practice.
And this is bad for consumers, because the cost is passed on to them. This is bad for StarHub and SingTel, because they don’t make money from the BPL or pay-TV programmes.
This is also bad for Singapore, because it becomes a place where this type of unhealthy competition is allowed to distort a market.
Argentina performing well in this Tournament, I think the improvement is due to the new coach Diego Maradona.
So I am sure that Argentina is going to win the FIFA 2010 Tournament.
You wrote: “The BPL is about money, and the rights owners would rather take less money in a StarHub-SingTel resale agreement than no money at all from Singapore (if they can’t get US$400 million, they will be happier with US$150 million than nothing).”
1. The content owners may decide to forgo earning the smaller revenues, in hopes of Singapore crawling back with the larger cash next year to ask for forgiveness.
2. Most importantly, the Starhub-Singtel combo is no longer a monopoly. The internet is fast becoming another delivery platform, and MDA cannot regulate that out of existence no matter how much it want to protect football fans and their luxury entertainment products.