Commentary: Singapore’s pay-TV content sharing

After all these years, and facing the wrath of football fans deprived of live World Cup matches, Singapore’s media regulators finally decided a fortnight ago to rule out exclusive pay-TV content henceforth and bring an end to one of their most costly mistakes of late.

As Acting Minister for Information, Communications and the Arts (MICA), Lui Tuck Yew, told Parliament two weeks ago, the authorities will now force pay-TV operators – mainly StarHub and SingTel now – to share their content.

This brings an end to costly bidding exercises that have made it expensive for football fans to watch exclusive programmes like live Barclays Premier League (BPL) matches.

While a positive move, the question remains if this has come too late, and if the authorities, mainly the Media Development Authority (MDA), an agency within MICA, had allowed such a distorted market to develop over the years.

For more than seven years, the MDA had simply washed its hands of the market, choosing in 2006, and later in 2007, to say that there were no problems with the market, even when SingTel and Starhub were paying hundreds of millions of Singapore dollars for exclusive BPL content, making the country one of the costliest markets in terms of dollars per capita.

The final straw came in the past two months, when it was revealed that Fifa, the rights holders for the World Cup 2010 in June, had demanded a ridiculously high fee that StarHub and SingTel simply refused to pay.

To think it had taken the farce of Singapore being one of a handful of countries to miss out on live World Cup matches to get the Government to act.

And for two market rivals – SingTel and StarHub – to put aside differences to table a joint bid for the World Cup, which was rejected by a greedy Fifa keen to exploit Singapore’s willingness to pay for exclusive content, to move this impossibly bad situation for Singapore’s pay-TV viewers.

Might things have been different had the authorities acted all these years, instead of telling people nothing can be done, and that rights holders will just “leave Singapore” if the authorities had forced the sharing of content?

Well, the answer is clear now. That official line, held for years by MDA, is now officially rubbish, after Minister Lui finally admitted two weeks ago that the current situation is a “market failure that is evident”. Yet, as he delivered the changes, he must have also wondered if they have come too late.

Firstly, if he had ruled on this just months before the current BPL bids were accepted, SingTel would not have paid excessive amounts for the upcoming three seasons. Users would not have to worry about getting a second set-top box to watch different programmes on the telly.

Secondly, the ruling, which only applies now, may or may not be enough to bring the World Cup to Singapore. Fifa is well prepared to play hardball and stick to its asking price, which has been said to be above a stratospheric S$40 million.

To this, I say football fans will just have to treat this entire episode as a harsh lesson in pay-TV economics.

That the authorities have so dramatically reacted to a potential loss of World Cup rights will not bring instant results when it comes to the screening of content that is in hot demand.

Sports rights owners, say, the Football Association Premier League (FA PL) in Britain, have always played hardball when it comes to exclusive rights. And they might well say “forget Singapore” if the authorities here insist on sharing content.

To which, I say, you, the football fan, just have to start voting with your wallet. So far, you have said no to the damaging exclusive content deals that have made everything expensive and inconvenient for pay-TV viewers. And finally, the authorities have acted in response.

Should content owners, in the form of Fifa or FA PL or anyone else, try to force the issue in future, couch potatoes would just have to learn to say no, offering a big thumbs-down to bad deals.

I’m prepared not to watch the World Cup. If I have to watch the final, I might just drive to Malaysia to watch it. Football fans here, I imagine, would find this tough at first, but realise that it’s the only way forward in the long term.

From here, let’s see where this new ruling brings us.

If done right, with the next-gen broadband network up in Singapore from this year, the new content-sharing rules could mean that content is piped through one network, over one set-top box, and viewers will be able to choose – at their convenience – what pay-TV programmes they want, at a time they choose.

That will be progress indeed.