Structural or operational? The separation debate rages on in Australia with the government, opposition and even Australia’s competition watchdog all making their opinions public. However, the most influential barracking against separation has come from a most unlikely source.
Telstra has won the backing of both the AFL (Australian Football League) and NRL (National Rugby League), two of the nation’s biggest sporting codes, in its bid to fight off calls for the company to be split up to boost competition in the communications sector.
Most of the 120 submissions received by the Government call for Telstra to face severe curbs on its dominant position in the market and it’s widely believed that the government could use the inquiry to force Telstra to sell its high-speed cable network and its 50 per cent stake in the pay TV operator, Foxtel.
But not if the powerful sports organisations have their way. The AFL and NRL, which have sold pay TV and Internet rights to Telstra, strongly support the incumbent staying whole and may present a formidable front against any separation moves.
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The NRL said the market for online rights for sporting content was highly competitive and suggestions that it could face regulation without causing financial hardship for the sport were “simply delusional”.
(via Sydney Morning Herald)
In sports-crazy Australia the support of the two leading football leagues as a formidable lobby group could be a major factor in the decision-making process. It should be no surprise really as Telstra is a major sponsor of sporting events in Australia as well as holding the pay TV and Internet distribution rights to many sporting events, including ARL and NRL . However, increased competition could also mean increased potential earnings for sporting bodies as more telecasters would likely increase bids to win over critical rights. In view of this it seems unusual that bodies like the ARL and NRL would add their support to the anti-separation lobby.