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24 Oct 2001 : Column 114WH

Sport on Television

12.25 pm

Mr. Parmjit Dhanda (Gloucester): I am grateful to have secured this Adjournment debate on access to sport on television, a matter of great importance to my constituents and to people throughout the land. I shall discuss three aspects of the issue: why access to sport on television is important, some of the current problems of access to sport on television, and what may be done to improve levels of access.

We may ask ourselves why access is of such significance. Anyone who was in the country when Tim Henman reached the semi-finals of Wimbledon, or when David Beckham hit that free kick at Old Trafford a couple of weeks ago, will be aware of the sense of national pride felt across the nation when we do especially well at sport. The Department for Culture, Media and Sport is keen to encourage participation, and greater visibility of sport on television will lead to further encouragement. Participation in sport helps to reduce unemployment and crime and leads to better health and qualifications.

The formation of a university of Gloucestershire was announced yesterday, and it will concentrate on sports science at a campus in my constituency. I hope that the Minister will join me in congratulating everyone involved in that announcement on their hard work to ensure that the project has come to fruition.

A wide range of parties have different interests in how sport is shown on television, including fans, players, clubs, rights holders, competition organisers and digital, terrestrial, satellite and cable companies. However, at times some effective mediation seems to be missing between those parties, and agreement between them is also missing. Several governmental and non-governmental organisations including the Department for Culture, Media and Sport, the Office of Fair Trading, the Independent Television Commission and Oftel—it will soon become Ofcom—are trying to fit into the mediating role, but we need to look at the issue more closely.

As the DCMS put it, we have a duty as a Government to provide quality broadcasting for the many, rather than the few. In some cases, the Government can safeguard universal coverage due to the listed events under the Broadcasting Act 1996. Come what may, we know that certainly the final stages of Wimbledon tennis will be on terrestrial television, as will the Olympic games and the football, cricket and rugby world cups. Under the 1996 Act, the ITC is required to ensure that a non-free-to-air broadcaster, or a free-to-air broadcaster, can show any part of a tournament live only if a free-to-air broadcaster with at least 95 per cent. coverage has acquired similar rights or been given the opportunity to do so on fair and reasonable terms. It is those terms that sometimes cause confusion.

Thanks to that legislation and to good government, the Minister for Sport, working with ITV and the BBC, was able last week to announce that the World Cup in Japan and Korea will be available free to air. I should like to think that my early-day motion 221 calling for the World Cup to be on terrestrial television had had some effect.

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I want to take a closer look at the deal that was struck last week. The TV company Kirch Media that bought the rights to the World Cup in 2002 did so with the clear objective of maximising profits by selling the rights to the highest bidder. Kirch insisted throughout that it would make only England matches, the opening match, the semi-finals and the final available to terrestrial television channels. That would have meant their missing the Brazil v. Argentina match and games involving Italy, Germany and France. We need greater clarity in the regulations, because in seeking to back up its position Kirch said that selling the rights to the highest bidder in each country was in line with the regulations of FIFA, football's world governing body.

The European Commission investigated the television rights to Champions League games, and it signalled that UEFA may have violated competition laws. An EC spokesperson described the system of auctioning TV rights to the highest bidder in each country as highly anti-competitive. The self-regulatory system of major football rights holders ultimately limits TV coverage and reduces access to sport on television. I am delighted that good government should have prevailed over profiteering for the rights to the 2002 and 2006 World Cup. We must remember that, during the last World Cup, even games such as Belgium v. Sweden and Cameroon v. Austria attracted 7.3 million and 8.7 million viewers respectively—bigger audiences than for most live games on terrestrial television.

I would like to see the BBC and ITV deal replicated for those rugby matches in which the British Lions are playing. My constituency of Gloucester, a rugby-loving town with a successful team—the cherry and whites—had problems in the summer during the British Lions tour. Live games were available only on satellite television, and in order to watch them my constituents had to choose between signing up to a satellite TV package and visiting a pub, often at 9 o'clock in the morning. Those who wanted to see highlights of the games could do so only by popping over the border into Wales and watching S4C, a far from satisfactory arrangement.

The Parliamentary Under-Secretary of State for Culture, Media and Sport (Dr. Kim Howells ): Good for Welsh tourism.

Mr. Dhanda : Yes, good for Welsh tourism, but the British Lions tour games are steeped in such history that they should be on an even footing with the rugby world cup, not least because rugby world cup games such as Tonga v. Argentina are better protected for terrestrial viewers than British Lions tour games of Australia.

Access to sport on TV could affect not only how we watch sport; it has the potential to determine the future of broadcasting. When people buy new television sets and choose to subscribe to pay TV, their choice is usually determined by the availability of sports and movies in the package. The massive growth of pay TV during the past 10 to 15 years has been driven by the public's appetite for watching football. The rights to show sport have a positive effect by increasing subscription and are therefore hugely significant as a

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factor in deciding who will be the dominant provider. Today's debate about access to sports on television is therefore also a discussion about the shape of broadcasting in the longer term. It is a complicated but important debate about a highly aggressive market, in which technical and legal arguments are often used to make things much foggier.

The television market is made up of different providers—Sky, the BBC, ITV and so on—on a range of different platforms such as digital terrestrial, cable and satellite. The TV that we are most used to is the traditional analogue television, which is picked up with an aerial on the roof. The Government plan is to phase out analogue TV at some stage between 2006 and 2010. The reason for switching to digital is obvious: it gives a vastly better picture than analogue, provides more channels and choice, better mobile reception and greater interaction. The advantages are there for all to see, as last week's digital action plan made clear.

The plan, however, did not define a clear date for the switch-off of analogue TV; we know that it will happen at some stage between 2006 and 2010, but we need to take a closer look at the date. The lack of clarity on that point has had some negative effects for sport on television. By setting a date, we would allow our forefront digital companies to plan for the long term, which can only help to bring down subscription costs. Digital television is already available to around 8 million viewers and is currently dominated by Sky TV, which distributes its digital TV package through satellite dishes. ITV is the next major player in the market, but even that company is dwarfed by Sky.

Sky is largely responsible for creating the market. The massive amounts of money going to football and the influx of quality foreign stars and managers into the Premiership are a direct result of the money that Sky has paid for the broadcasting rights. Providing access to sports makes business sense for Sky, which uses them as an incentive to encourage new viewers to take up subscription to Sky on satellite. Sky is doing a good job: it has more than 50 per cent. of pay-TV homes, recoups more than 70 per cent. of pay-TV revenue and is without doubt the dominant player. However, Sky sometimes uses its strength to muscle other opponents off the ball, and its style of play in Europe has required some intervention from European Governments.

Sky has four times the number of subscribers of ITV, its nearest rival, which has only 1.2 million customers. The two companies do not have a good relationship; it is not merely a fierce rivalry between two channels but a more significant battle between two platforms. Sky broadcasts use digital satellite while ITV uses digital terrestrial television—or DTT. Over the past few months, supporters of football clubs such as Liverpool, Manchester United and Arsenal have suffered: having paid for a sporting package on Sky Digital, they find that they cannot receive the ITV sports package that allows them rights to the Champions League. The process works in the opposite direction, however: viewers can have an ITV digital package and watch Premiership football on it. So consumers are sometimes required to buy two packages rather than one, or they may choose between them and have to get rid of the package at the relevant moment.

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The communications White Paper, published in December 2000, proposed the imposition of a "must offer" obligation on public service broadcasters without a matching "must carry" obligation on satellite networks such as Sky. Under current arrangements, cable operators carry the public service broadcasters free on their networks and, in return, cable operators are not charged for copyright. "Must carry" also effectively applies to digital terrestrial television because of the capacity on the multiplex gifted by public service broadcasters and the requirements set out in the multiplex licences.

The White Paper envisages the situation continuing for both cable and DTT but does not extend that to satellite. We should consider that matter more closely. The guidelines specifically preclude satellite providers, which are the largest providers of much of the exclusive sport on television. We should look for a way in which to provide greater clarity, vision and leadership in that debate. This week, it has emerged that ITV Digital is suffering under the weight of heavy competition. It is right for the digital action plan to focus on the long-term plan, but there is also a need for immediate action in this volatile market. I would like us to set a date for the end of analogue television.

I am sure that I have given hon. Members a taste of the complexity of some of the issues involved in broadcasting sport on television. Given that complexity and the potentially massive influence of how sport is shown on television, there is a need for a body to monitor and work as a mediator in this highly competitive market. Perhaps it is even time for us to consider an Of-football regulator for football, which is so huge and of such value to us. Such a regulator could not only resolve disputes between players and the industry but deal with arguments over football in the media, such as that between ITV and Sky. If we do not act now, we are in danger not only of taking away from the nation the joy of a successful and beautiful David Beckham free kick but of depriving the nation of its position at the forefront of the digital age.

12.40 pm

The Parliamentary Under-Secretary of State for Culture, Media and Sport (Dr. Kim Howells) : First, I congratulate my hon. Friend the Member for Gloucester (Mr. Dhanda) on securing the debate. I am aware of the strength of feeling that exists in his constituency, in mine and in the House on this matter. The accessibility of sport on television is an important subject. It is also at the centre of our economy in this—to use a cliché—post-industrial age. Television and communications are huge drivers of jobs, entrepreneurial ventures and new inventions. We need those sectors. The countries that will do best in the 21st century are those that have recognised that their economies must be talent-driven, and television is a classic example of a talent-driven industry.

My hon. Friend has represented Gloucester very well. I suffered badly at the hands of rugby players in Gloucester—they were a rough lot, I remember. Cherry and white shirts used to become blood red very quickly. That is where the art of coarse rugby was invented and is still played.

I enjoyed my hon. Friend's call for a single regulator or mediator. My hon. Friend will know that recently, in another place, we introduced what is known in the

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jargon of the House as a paving Bill to set up Ofcom, the single regulator. At the moment, there are a large number of regulators. There is also the BBC, which regulates itself through its board of governors, and a small but important broadcasting organisation in Wales called S4C—the Welsh Channel 4—to which my hon. Friend referred earlier.

We are concerned at the great confusion of regulators. I would not criticise any of them, because they have done a good job, but the world has moved on and technology is moving on quickly. We must ensure that the regulation that is in place— especially for the brave new world of digital services—can keep pace with technological advance and that it can accommodate it. We must not institute a new regulatory regime that is already redundant. It is important that we do it.

I disagreed with little of my hon. Friend's argument, but the idea of another regulator—a football regulator—will wake me up at 2 am tomorrow in a cold sweat. There are enough regulators already, without appointing more. However, I can see his point and I hope that when we publish the full communications Bill, which we hope to do in February, my hon. Friend will contribute to the debate. We will publish it in February for consultation, and we want everyone in the industry to read it. The question of sport and regulation is most important.

Mr. Dhanda : On that point about regulation and current legislation, does my hon. Friend believe that Ofcom will be a more effective regulator in bringing together the entire communications field—satellite, digital and terrestrial television with the interactive studies that go with it—than the current more disparate layer of regulation?

Dr. Howells : Yes, I hope that the single regulator, instead of the collection that exists currently, will be a step forward and will accommodate the various platforms. My hon. Friend concentrated on the question of different platforms, and I will do so, too. We are at a vulnerable point in the digital programme. Two ITV companies, Carlton and Granada, have put a lot of money—as much as £800 million—into what is now known as ITV Digital, but used to be called ONdigital. So far, it has about 1.2 million subscribers, but the companies are concerned about the investment, which has been written off—far too often—by the press and the broadcasting anoraks. I am an eternal optimist and I hope that it is safe, because it is important that we have at least three competing platforms.

The digital revolution will be pushed forward by competition, and it is not the business of the state to underwrite those technological and commercial advances. It must be content driven, and people will want to buy digital only because they see it as better than what they have, whether through increased access to programmes on sport or those on any other subject. Competition must drive that forward, not the pronouncements of a Whitehall Minister or official.

Mr. John McWilliam (in the Chair): I hope that the Minister was not referring to me as a broadcasting anorak because I am a former member of the BBC's General Advisory Council.

Mr. Khalid Mahmood (Birmingham, Perry Barr): I want to point out some statistics about current access to

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pay television. Some 41.5 per cent. of people have access to pay television of some kind. Of those, 36 per cent. have access from satellite and 11 per cent. via digital. Being a former rugby player, I enjoy the six nations tournament and the good record of the British Lions. People in Birmingham, especially in my constituency wards of Perry Barr and Oscott, are tremendous supporters of both football and rugby. Enthusiasm for sport is high, and Birmingham has a parks cricket league with 58 teams, which is the largest set of teams in any part of the country.

However, pay and satellite channels are not affordable for most of those people, who are in the lower end of the pay scale but still want to watch sport. Sport should be a family event. It should enable people to get together. When there are pay sports, people generally go to their local pubs and so they cannot sit with their children and wider family. Over the weekend, the ITV network decided to reschedule its Premier League matches, but that is different. International and national games should belong to everyone and should be more widely available on terrestrial channels.

Dr. Howells : I thank my hon. Friend. That is a great advert for Birmingham rugby. It was the most concentrated speech I have heard in this place in a long time, although it was really an intervention.

Mr. John McWilliam (in the Chair): Order. Had the hon. Gentleman made a speech, I would have called him to order.

Dr. Howells : Thank you, Mr. McWilliam. I love the relaxed atmosphere here.

On the specific question of rugby being a listed sport, it might be a good idea if I reminded hon. Members of the lists of sporting events protected under part IV of the Broadcasting Act. Group A, for which full live coverage is protected, comprises the Olympic games, the FIFA World Cup finals tournament, the European football championship finals tournament, the FA cup final, the Scottish FA cup final, the Grand National, the Derby, the Wimbledon tennis finals, the rugby league challenge cup final and the rugby world cup final. Group B, which protects secondary coverage, comprises cricket test matches played in England, non-finals matches in the Wimbledon tournament, all other matches in the rugby world cup finals tournament, six nations rugby tournament matches involving the home countries—which now include Italy, an idea that I love—the Commonwealth games, the world athletics championships, the finals and semi-finals of the cricket world cup involving home nation teams, the Ryder cup and the Open golf championship.

My hon. Friends are calling for an event like the British Lions tour to be included. BSkyB has purchased exclusive live rights to the British Lions rugby union tours for 10 years. British Lions matches are not listed events because they do not meet the necessary criteria, or they certainly did not meet them until my hon. Friend the Member for Birmingham, Perry Barr (Mr. Mahmood) made his case. BSkyB must therefore decide to whom, if anyone, to sell the highlights. Secondary coverage of this year's three test matches against

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Australia was sub-licensed, as I think my hon. Friend the Member for Gloucester mentioned, to S4C and was available to viewers in Wales.

The time to make the case is when the next review of the listed events occurs. That time probably starts now, although we do not envisage an early review of the list because there has only just been one. I take my hon. Friend's point about rugby union, which is certainly an enormously popular sport. In some parts of the country, it borders on a religion. A great many people would love to have seen the games in the southern hemisphere. There is a problem, however. I am not making excuses for the broadcasters, Mr. McWilliam, and you are well aware of the problems. If one takes the British Lions tour to New Zealand or to Australia, the time differences are so huge that broadcasters would have to run them through the night. That is not a bad thing, given some of the dross on television during the night, but it is a decision for the broadcasters.

The case for running an entire series as a listed event with that time difference in mind is no easier to sustain in terms of projected viewer figures than is running a cricket test match through the night. At least as many people would appreciate watching cricket. Those who are passionate about rugby would not mind that, though I have to admit that it is a long time since I have been able to stay awake after 10.30 on any night.

The World Cup final tournament is important to millions of UK sports fans. In 1998 the tournament included 64 matches. It has been listed in its entirety since 1985. It is a huge tranche of games. Interest in cup matches goes well beyond those involving the home nations. My hon. Friend the Member for Gloucester mentioned that matches between what might have been thought of in this country as obscure nations gained audiences larger than "News at Ten" and many other popular programmes.

FIFA requires that the opening game, the semi-finals, the final and games involving a national team should be shown on free-to-air television. One expects such matches to attract large audiences in this country and elsewhere but, as my hon. Friend said, it is much more surprising that 9.3 million people tuned in for Morocco v. Norway. I was amazed when I saw that figure. Furthermore, 9.8 million people watched Germany v. Iran and no fewer than 10.2 million watched Jamaica v. Croatia.

Mr. Peter Luff (Mid-Worcestershire): Hear, hear.

Dr. Howells : Clearly one of them is sitting opposite and I have no doubt that it was a cracking game. I was nevertheless surprised at that level of interest.

Mr. Dhanda : I agree with virtually all that my hon. Friend said. However, does he agree that, although we should let the markets decide in most respects, when people have already forked out to watch Premiership football on Sky Digital, they should not have to fork out again for another platform to have the widest choice? That is why they paid in the first place.

Dr. Howells : My hon. Friend makes one of the key arguments that I hope will be debated when the draft Bill is published in February. It is an important point.

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The manner in which the digital project is carried forward will depend on people feeling comfortable with the system and platform that they have bought into. We know that ITV is having problems with Premier League football on Saturday evenings: it may be shifted to another time and there is talk about selling to another platform, which will remain nameless, for wider distribution. We shall have to examine that carefully.

I hope that my hon. Friend does not believe that politicians should decide the matter. Parliament should certainly debate it, but God forbid the day when politicians such as myself, others in the House or officials tell broadcasters what they can and cannot broadcast. The great achievements of the British television industry—terrestrial, satellite or cable—have been gained not as a result of political decisions but because of the creativity and talent of the people who work in it.

Many curious decisions are made about what sport should be on television and when it should be shown. The market research carried out by ITV revealed that buying the Premiership rights cost £185 million—£25 million more than the deal that ITV and the BBC did with Kirch to buy two lots of World Cup coverage. It looks like a lot of money now, and people wonder about those decisions, but they are commercial, artistic and creative decisions taken by broadcasting companies. We should not be in the business of telling them how to conduct their business.

I am a little confused about the time. Perhaps you can tell me when I should finish, Mr. McWilliam.

Mr. John McWilliam (in the Chair): Time is up now.

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