'Legal remedy's the last resort'

Q & A/ R C Venkateish

R C Venkateish

The decision to make it mandatory for private broadcasters to share their feed with Prasar Bharati is the least of the problems that firms like ESPN-Star Sports face. The interest in cricket has picked up only now after the Sri Lankan series, the rights to cricket in India remain tangled in controversy, Zee has just won the rights to the India-Sri Lanka series, and the F1diversification looks dicey with Karthikeyan barely retaining his F1 driver status. R C Venkateish, the managing director of ESPN-Star Sports, spoke to Business Standard on the challenges ahead, but refused to discuss numbers.
Excerpts:

The situation on ground doesn't seem to be good for private sports broadcasters.

We still feel there are several windows of opportunities for collaboration with Prasar Bharati. We have to see that a framework should evolve whereby the business model of private broadcasters is protected and the national interest is also served.

What do you have to offer?

It has been recognised that it is necessary to provide certain exclusivity to the private broadcasters to protect their business models. We have proposed that one-day internationals would be shared with Prasar Bharati, while Test matches would be shown exclusively by private broadcasters.

We have had a detailed discussion with the government on this issue where we had all private sports broadcasters as well as some rights management companies. So, there is a clear framework that all are comfortable with "" private broadcasters, Prasar Bharati and the government.

How badly does sharing of content threaten to impact private sports broadcasters like you?

Sharing of content reduces the exclusivity of content. This has an impact on your subscription revenue. It reduces the value of the rights. This impacts the rightholders, the payments to the sports bodies and, ultimately, affects the players, too. It impacts the whole sports infrastructure in the country.

We are not saying that everything should be exclusive. There are events of national resonance or national pride. But there should be a strict criterion to determine these events. There has to be some transparent criterion. People should know the parameters on which these events are selected. Unfortunately, our initial interface seems to indicate that all cricket will be included in events of national importance. Does it mean that apart from cricket, nothing else is of importance? Is all cricket important, or only those matches in which India plays? Or if India plays Kenya or Bangladesh, is it important? There is a lack of clarity in the thought process that has gone behind it. Unfortunately, apart from one meeting in July, key stakeholders such as broadcasters, sports bodies and rights holders have not been involved in any way in the formulation of these policies.

Is sports broadcasting only about cricket in India?

For sports broadcasters, cricket undeniably is important. But the newer generation is tuned to multiple sports. We see a lot of traction building up in soccer, hockey and F1 racing.

But didn't viewership for FI racing drop after the initial euphoria when Narain Karthikeyan failed to live up to the expectations?

We did very well. In F1, apart from the driving skills of the driver, a lot depends on the vehicle and many other factors. The F1 franchise is only growing and participation of Indians like Narain will only give it a big boost.

You also have not had any great cricket in the recent past. In fact, cricket seems to have got a new life only after the recent India-Sri Lanka series.

If your team does well, the ratings go up. But we had a lot of cricket in the past one year.

How has it impacted you? How have the two channels done in the past one year?

Despite all this, we have been doing extremely well. Last year was one of record sales. The advertising revenue stream is growing. The revenue stream from affiliates has had a lot of constraints put on it because of Trai's freeze on prices. It's now been close to two years. At the same time, the costs are shooting up, the rights are becoming more expensive. We do not have the flexibility to pass on the increases. Compulsory sharing is likely to raise a fair amount of trouble till it is sorted out.

Looking forward, the rights for BCCI cricket are caught up in a legal tangle. Where does this leave you?

We have quite a sizeable amount of content. In March, we have the Asia Cup. In June, there's the FIFA World Cup. Following that, there is India's tour of South Africa, where there is also a tri-series with New Zealand. There is an enormous amount of sporting content especially in 2006. We have Australian Open, Wimbledon. Both F1 and A1.

If you look at cricket, after India-Pakistan gets over in Ten Sports, we have the rights for all the cricket till 2008, except the World Cup, which is on Sony. We have had a lot of overseas teams coming to India in the past 12 months. After England comes to India in March 2006, for the next 12-14 months there will be India's overseas tours coming in. So there will be a huge line up of content on our channels. It is expensive content for which we have paid a lot of money.

Are you prepared to share all this cricket with Prasar Bharati?

We hope to work out a solution amicably by then. We want to keep the legal option for the last. It is a challenge. Sharing of content is detrimental to our revenues. We have invested heavily in these properties. We have to ensure that our business model is protected. The government has to see who else has stepped forward to save our national game (hockey). But there are still caps on our prices and we have to share our content. I can't understand why such disincentives are being dished out to sports channels.