Foxtel apparently made a major announcement in Crikey’s comments section on Friday that could have major consequences for media diversity.
For those who missed it, on Thursday I detailed how the deep pocketed Al-Jazeera International is renting its own space on the Optus C1 satellite and broadcasting free-to-air to over half a million homes in Australia. While those with their own set top boxes can tune in relatively easily, neither Foxtel nor Austar is allowing its subscribers access through its Electronic Program Guide (EPG).
I made the specific comparison at the time to the Freesat from Sky system offered by Foxtel’s sister network BSkyB (branded as Sky) in the UK. Over 120 free-to-air channels are broadcasting independently and unscrambled to UK homes and appearing on Sky’s set top boxes and in its EPG.
Writing in response on Friday, Foxtel’s Corporate Affairs Manager Rebecca Melkman seemed to commit Foxtel to offering a Freesat-like platform. Specifically, she wrote “[Westbury] neglects to mention that every one of those channels has agreed to pay BSkyB for access, which is precisely what Al-Jazeera could do in Australia.” Before Friday, no Freesat-like option had been available to broadcasters from either Foxtel or Austar, so Foxtel’s offer to “precisely” replicate it for Al-Jazeera is a major commitment. Will this apply to other broadcasters or only Al-Jazeera? Is this an undertaking that the ACCC will be able to enforce?
Under Freesat, satellite broadcasters can do what Al-Jazeera has already done in Australia: rent their satellite space themselves and simply pay a fee to BSkyB to ensure that they are listed in their program guide and channel lists. The amount they pay is overseen by the communications regulator Ofcom [and currently the subject of a dispute] but it is much less than that applied by Foxtel in Australia. Over 120 channels that are not reliant on subscription revenue have taken up this option and it is easily the most cost-effective way to access the platform.
By way of comparison, under Foxtel’s so-called “Access Regime”, a potential channel must cover not only the costs associated with Foxtel’s EPG but also a wide range of other expenses for services that they may or may not need. While Foxtel heralds these terms as “fair and transparent”, they have not been made available to Crikey. They are believed to include conditional access (encryption) technology, network costs and a variety of other fees across both the satellite and cable platforms – often regardless of whether or not the broadcaster needs or wishes to use them. Compared to the Freesat system, costs are many times higher and act as a formidable barrier to entry – particularly for free to sir channels.
In 2003, former Director-General of the BBC Greg Dyke put the difference between Freesat and the previous structure that the BBC had used to access BSkyB to a London Business School function. Of the decision by rival ITV to join the BBC in adopting the Freesat model and abandoning the use of the full BSkyB platform he said:
Free to air broadcasters, like CNN, only pay Sky £30,000 (about AU $75,000) per year for their EPG listing. So for ITV it was like buying a £30,000 car and being charged £17 million [the figure that ITV was paying at the time to Sky to broadcast its package of national and regional channels] to use the sun roof.
In Australia, Foxtel’s so-called “access regime” bills its clients not just for the sun roof but for mag wheels, bucket seats and fuzzy dice. And if a broadcaster is only willing or – due to Foxtel’s often cited capacity limits – able to broadcast via satellite, it either blocks them outright or effectively charges them for a second exorbitantly hotted up car – access to the cable system – as well. The two models are precisely very different.
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In nearly five years, racing broadcaster TVN is the only “independent” player cited by Foxtel as having succeeded in getting access under the so-called “Access Regime.” Most other broadcasters don’t have access to gambling revenues or valuable sports rights that Foxtel (through Sky Racing at the time) has recently lost.
The issue is not Al-Jazeera, it is a monopoly combined with bad practice, bad process, and a weak regulatory environment. Local players such as Fairfax and international players such as Al-Jazeera have publicly and repeatedly questioned the level of access. It certainly doesn’t help to make things “fair and transparent” if Foxtel Corporate Affairs is offering up spurious comparisons and claiming to offer access that isn’t there.
What is unique about Al-Jazeera is its determination (and deep pockets) and its unwillingness to take no for an answer. In paying for its own space on the satellite that Foxtel uses it has effectively forced Foxtel’s hand.
Perhaps Foxtel will explain precisely what “precisely” means?
Crikey is keen to hear the experiences of any broadcasters who have tried to access Foxtel through the “Access Regime”. Email [email protected].
Rebecca Melkman, Foxtel’s Corporate Affairs Manager, writes: Getting through to Foxtel is easy for genuine access seekers. We encourage people who are sincerely interested in using our platform to contact us directly because Marcus Westbury’s tub-thumping about access to Foxtel is drowning the facts. In his latest effort to tar and feather Foxtel, Mr Westbury states that Foxtel access user TVN is owned by one of Foxtel’s owners PBL [Ed: an error removed from the above article]. It might suit Mr Westbury’s pre-judgement of the Foxtel access regime to draw this link. Too bad PBL does not, and never has, owned TVN. The detailed price terms of access to Foxtel are available to genuine access seekers on a commercial in confidence basis because the terms contain commercially sensitive information about the Foxtel business.