Following the announcement from SingTel over their acquisition of exclusive rights to broadcast the 2014 Fifa World Cup, competitors StarHub have made known their displeasure at means at which the rights were obtained.
In a statement to the media on Wednesday night, StarHub's Chief Marketing Officer, Jeannie Ong, blasted SingTel for paying a high price to gain exclusive rights instead of placing a joint-bid as they had done in 2010. She also raised concerns over the resultant increase in subscription price for consumers due to the exclusive purchase by SingTel.
“We are concerned that customers will have to pay more for 2014 FIFA World Cup," read the statement from Ong. "At a time of escalating sports content costs, we made a sincere offer to our competitor for a similar arrangement as the last World Cup. A joint bid would have spread the cost of the content and allowed both operators to offer the tournament at a more affordable price, benefitting all viewers in Singapore."
"Unfortunately, our competitor chose to acquire the rights exclusively. The higher price our competitor paid for the exclusive rights for this year’s World Cup (compared to 2010 World Cup) exacerbates this trend."
The 2010 World Cup was offered by StarHub as a stand-alone package for S$88 (S$66 for StarHub subscribers) while the 2010 edition was priced at $15.75 (Sports Group customer) and $26.25 (customers who are not on the Sports Group).
SingTel, as exclusive rights holders will determine the pricing for both StarHub and SingTel consumers for the 2014 World Cup and have announced that they will charge S$105 for a stand-alone package ($112.35 including GST).
Ong warned in her media statement, that SingTel's practice of paying over the odds for exclusive rights will have 'far-reaching implications in the future for viewers in Singapore'. She also critcised SingTel's offer of free broadcast to recontracting and new subscribers of mio TV as a means to lock consumers in a long term contract running foul of Media Development Authority's (MDA) ruling, calling it 'counter to the cross-carriage regime’s objectives'.
MDA in an earlier statement promised that they will oversee the amicable implementation of the cross-carriage rule, in light of the importance of the event. There had also been hopes that both StarHub and SingTel will offer discounts to consumers for the World Cup as they had done for the English Premier League packages.
However, in Ong's statement on behalf of StarHub, she categorically ruled out the possibility of any similar subsidies, stating that it has only had a negative effect in bidding for rights.
"Unlike the Barclays Premier League where we provided a rebate to our customers who chose to subscribe to the content cross-carried on our platform, we will not be able to provide a rebate for the World Cup," she said. "The rebate was intended to help our customers, but it has inadvertently encouraged our competitor to continue making higher exclusive bids, which in turn, further inflates the cost of sports content."
"We do not support overbidding of content prices by our competitor, as it will have long-term adverse implications for the industry and Singapore viewers.”
The figures for the rights for the 2014 World Cup have not been released by either company. In 2010, both StarHub and SingTel bought the rights in a last minute joint-deal after a lengthy bidding war, for a reported S$21million. The figure was S$6.3 million for a sole bid from StarHub just four years prior.
The hefty amount paid in 2010 was cited as a reason for the increase in costs for the rights of the English Premier League in 2012. Hong Kong's Television Broadcasts Limited (TVB) reportedly forked out HK$400million (S$65million) for the exclusive rights for the 2014 World Cup.