A court battle between Telstra and Optus over whether a TV program can be streamed to portable devices minutes after it has been broadcast is set to get a decision this week in the Federal Court. At stake is millions of dollars in sponsorship fees which could affect future NRL and ARL funding.
The issue blew up early last year when Telstra signed a $154 Million dollar deal with the Australian Football League (AFL) to stream live football games to a new generation of smartphones and tablets.
Shortly afterwards Optus launched a new service called TV Now which delivered the same content 2 minutes after it had been aired on free to air TV.
The service lets consumers shift the time of their viewing, which is currently allowed under Australian copyright law.
Optus who are not paying any money for AFL sporting rights claim that they are simply allowing their customers to access a free to air service time delayed in the same way that they deliver regular programs and news coverage.
The problem is that if Justice Steven Rares of the Federal Court decides in Optus’ favour it could strip millions in sporting rights from organisations like the AFL, NRL, Tennis Australia and the upcoming London Olympics.
Telstra, a sponsor of the Australian Olympic Team is currently discussing the possibility of getting access to the Olympics via Athletics Australia.
Nine and Foxtel paid $128m for the rights to televise the 2010 Winter Olympics and this year’s London Games. Both organisations are keen to on-sell internet and mobile phone rights in an effort to minimise their costs.
Telstra’s news and sport general manager, Jose Barea, said recently that Telstra was in discussions about opportunities from the London Olympics, which begin on July 27.
If the Optus Vs Telstra case goes in Optus’ favour the carrier could well be in a position to put the Olympics to air via their TV Now service.
A decision against Optus would put it in breach of the Copyright Act.
Justice Steven Rares has already ruled after a two-day hearing in December, that any decision he makes can be appealed in the High Court.
Some observers claim that if Optus win their case Telstra may choose to pursue it for damages relating to customers who watched AFL games using Optus’ TV Now service last year, in breach of Telstra’s exclusive contract.
