SELLING goods or services, whether they be four ergonomic chairs in the Trading Post or media rights to Australia’s professional sporting leagues, depends upon one thing – competition among buyers.
As Darryl Kerrigan tells his son Steve in The Castle, if the seller of those chairs wants $180 for them but there is only one buyer, ”he’s dreamin’ ”. The same can be said about Australia’s politicians and their misguided affection for the anti-siphoning list. The list preserves listed sports events to the free-to air television channels. With the list due to expire on December 31, there is great interest in the new list, to be announced by Chelsea soccer fan and Australian Communications Minister Stephen Conroy.
The problem is, the anti-siphoning list takes away the right of professional sports in Australia to sell their property in an open market. This is a basic right that is a fundamental tenet of the Australian legal system and our economy.
Competition among three free-to-air networks – Seven, Nine and Ten – as well as other media organisations, including pay TV, enabled the AFL to negotiate a $780 million, five-year media-rights agreement. The deal promotes AFL football in an unprecedented way. It also returns millions to the clubs and players, and underpins game development programs.
The world’s most successful sports leagues are built on the back of media-rights revenues negotiated through a competitive bidding process. The US National Football League and English Premier League rose from prominence to dominance through pay television.
Yet, this week has seen all sides of politics unite to encourage Conroy to strengthen the list. Greens leader Bob Brown proclaimed: ”Australians should not have to pay to watch great sporting events on television.” Even Malcolm Turnbull – a sophisticated investor and lawyer – takes the populist view: ”As a matter of principle, major sporting events should be available on free TV.” A matter of principle? Do Australians take such an esteemed view of sport that free access to it on television is taken, without informed debate, to override bedrock Australian principles such as a free society and an open, competitive economy?
Through the anti-siphoning list, our politicians are denying professional sport in this country the opportunity to have the media industry genuinely compete in the broadcast-rights market. If business – not government – acted in this manner, the Australian Consumer and Competition Commission would act swiftly. The ultimate victim of anti-competitive behaviour is the person the politicians are purportedly trying to protect – the consumer or, in this case, sports fan. The consequence may be that the professional sporting sector doesn’t grow beyond the status quo.
It seems certain that Socceroos World Cup qualifiers – presently packaged with friendlies and A-League matches on Fox Sports – will find themselves added to the list. Australian soccer may struggle to develop a professional league as it could in an open economy. Owners who have invested millions in building A-League clubs may not receive a return. The game may not return vital funds to the grass roots.
The fans themselves have invested years of emotional toil in seeing soccer grow to respectability. If, through pay television, Australian soccer can grow a world-class professional league that serves the community, how are they worse off?
The constitution authorises the Commonwealth Parliament to make laws with respect to the ”acquisition of property on just terms from any State or person”. There is little doubt a sport’s media rights are ”property”. Previous High Court decisions suggest it may not be necessary for the Commonwealth to actually acquire the property, so long as it is acquired by someone for a Commonwealth purpose. In this case, by a free-to-air network to give effect to the Commonwealth’s desire that sport be made available on free-to-air TV.
Sport – and its clubs, players and fans – should therefore be constitutionally entitled to ”just terms”. If not, I fear that those who wish to grow professional sports in this country may only be ”dreamin’ ”.
Brendan Schwab is CEO and general counsel of Professional Footballers Australia and a member of the board of FIFPro, the world soccer players’ union. He is also general secretary of the Australian Athletes Alliance, the peak body for Australia’s elite players’ associations.