BSkyB faces hit from ‘landlady’ football ruling

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A legal ruling on Thursday could revolutionise the way Premier League football and other sports rights are sold in Europe and may cost British Sky Broadcasting up to £70m a year in revenue from pubs and clubs, analysts said.

Football clubs and highly paid players could also be hit by a subsequent reduction in income, the experts added, after a decision by the advocate general of the European Court of Justice to recommend that the full panel rules in favour of a pub landlady from Portsmouth.

Karen Murphy has appealed against a fine for evading BSkyB’s tariffs for showing live Premier League matches in her pub.

In 2006, a UK court fined Karen Murphy £8,000 and ruled that she was in breach of national copyright law for showing English Premier League games using an imported satellite card from the Greek satellite broadcaster Nova.

Because Nova had bought the Greek rights to EPL matches at a much lower rate than BSkyB paid in its own territory, Ms Murphy was charged only a 10th of what she would have had to pay the UK satellite broadcaster.

But Ms Murphy appealed against the decision all the way to Europe and the ruling by Juliane Kokott, one of eight advocates general of the ECJ, signals a potential victory for her when the full court sits on the matter later this year. The judges follow the advice of its advocates general in the majority of cases.

The EPL and most other national football bodies sell the rights to live matches on a country-by-country basis.

Nick Bell, analyst at Jefferies, said: “Pubs and clubs generate about £200m in revenue, but we only see one-third, about £60m-£70m, at risk [if the full ruling goes against BSkyB].

The News Corp-controlled broadcaster has about 44,000 premises licensed to show its sports content, with EPL matches the main attraction. Mr Bell said that given the EPL’s dependence on BSkyB over the past 20 years, he expected them to offer some form amelioration to the broadcaster, such as making the international rights available at a low price.

But Mr Bell added: “The ruling could have an immense impact on the way audio-visual rights, and particularly sports distributions rights, are sold in Europe.”

The cost to football bodies in Europe could be substantial, another analyst, who asked not to be named, said.

The EPL said it believed the advocate general’s ruling was wrong.

In a statement it said the ruling “may reflect a particular policy view in relation to the provision of audio-visual services throughout the EU, [but] if her opinion were to be reflected in the ECJ’s judgment, it would prevent rights holders across Europe from marketing their rights in a way which meets demand from broadcasters whose clear preference is to acquire, and pay for, exclusive rights within their own territory only and to use those rights to create services which satisfy the cultural preferences of their viewers within that territory.

“We would hope that when the ECJ comes to its judgment in our case that the current European law, framed to help promote, celebrate and develop the cultural differences within the EU, is upheld.

“If the European Commission wants to create a pan-European licensing model for sports, film and music then it must go through the proper consultative and legislative processes to change the law rather than attempting to force through legislative changes via the courts.

“The ECJ is there to enforce the law, not change it.”

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