The Telegraph
Sunday , January 12 , 2014
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Sports law pricks DD

- Prasar seeks change in revenue share clause

New Delhi, Jan. 11: A seven-year-old law aimed at helping Doordarshan make money and help viewers watch major sporting events across the world has ended up causing heavy losses to the public broadcaster.

According to a financial statement, the channel had lost nearly Rs 140 crore till the Indian cricket team’s recent South Africa tour.

Prasar Bharati, which runs Doordarshan, now wants the “contentious” Sports (mandatory sharing of signals) Act, 2007, which it believes is loaded in favour of foreign broadcasters, amended at the earliest.

The act says that any sporting event of national importance being telecast live in India has to be shared with Prasar Bharati, with Doordarshan getting to keep 25 per cent of the ad revenue. Seventy-five per cent goes to the original content rights owner.

Doordarshan earns revenues by selling ad slots for regular programmes. On the days it airs sporting events, it can’t telecast regular shows. While it does earn revenue by selling ad slots during sporting events, 75 per cent of the earning goes to the original rights holder under the 2007 act.

The 25 per cent Doordarshan gets to keep is usually less than the ad revenue it would have earned through regular shows, called opportunity cost.

The financial statement, with details of events covered under the act, reveals the extent of the loss Doordarshan has suffered. The statement shows that since 2007 — when the law became applicable and Doordarshan first shared telecast rights with Nimbus for the India-Bangladesh cricket series — the channel has lost Rs 138.91 crore till the South Africa series.

Since the act came into effect, Doordarshan has aired 50 sporting events, 41 of them one-day or T20 matches involving India. These included the ICC T20 World Cups in 2009 and 2012, the ICC World Cup in 2011, Wimbledon 2009, 2010 and 2011, and the 2010 FIFA World Cup in South Africa.

Among the rare occasions when the public broadcaster made some profit was the India-Pakistan cricket series in 2007. Its net profit was about Rs 20 crore, although it still had to pay approximately Rs 71 crore to the private broadcaster.

Prasar Bharati has written to the information ministry to amend the profit-sharing ratio. “The Prasar Bharati board is of the view that this arrangement be changed with Doordarshan getting 75 per cent instead of the current 25. When there was no response from the ministry, we even suggested that these games be telecast on DD Sports, instead of the national channel, so that we at least saved our opportunity cost, but they have been quiet over the issue…. Our budgets are shrinking and we have to look at ways to generate revenue,” Prasar Bharati CEO Jawhar Sircar told The Telegraph.

Information and broadcasting minister Manish Tewari couldn’t be reached despite repeated attempts.

Sources in Prasar Bharati said the 2007 law was actually helping private broadcasters, but a representative of a private broadcaster said Prasar Bharati wanted to have the cake and eat it too.

“Doordarshan can choose matches it broadcasts, while all risks are being borne by private broadcasters. DD usually picks matches, mostly cricket, in which India is playing, or other crucial sporting events. These are matches where the sponsor and the broadcaster can both make money,” the representative of the private broadcaster said.

“For Prasar Bharati, it is a no-risk game. Not only does it get premium sports programming without bidding, but it also gets 25 per cent of the revenue earned from advertising. It isn’t justified that it wants a bigger revenue share.”