Unexpected win for English football enthusiasts around the EU and heavy defeat for rights holders’ wallets

As part of a continuous attempt to move away from geoblocking and towards a Digital Single Market (“DSM”), the European Commission, the European Parliament and the European Council agreed, last 13 December 2018, to facilitate access to sports radio content within the new EU broadcasting rules, a move which the Premier League has criticised.  This comes much to the sports industry’s surprise as EU lawmakers and national governments had explicitly excluded sports coverage from these rules in discussions just over twelve months ago.

Until now, sports coverage had always been excluded from the EU’s aim to create seamless movement of internet content due to the specificities of the demand for it in each market in the EU, the high value of its rights, and the enhanced need to protect them. Under the EU’s new proposed broadcasting rules, broadcasters have the right to clear sports coverage for pan-European radio broadcasts under licensing as sports content falls within the scope of radio programmes which can air across the EU as long as they comply with national copyright rules in their home country. This means, for example, that a French broadcaster would be able to get a licence for Premier League matches, whereas under the current rules, which allow geoblocking, a listener in France cannot legally listen to football games broadcasted on BBC Radio 5 Live.  Sports content is therefore included in the EU’s move towards a DSM.

The DSM strategy is Europe’s solution to the developing nature of technology and connectivity in terms of consumers’ expectations of the ability to stay connected and continue to access content abroad. The aim of the DSM strategy is to prohibit “unjustified geoblocking” between Member States and remove discrimination based on consumers’ nationality or place of residence. Traditionally, EU lawmakers and national governments had generally excluded sports coverage from the new broadcasting rules because sports broadcasts do not have copyright protection. However, sports radio broadcasts have now been included within such rules and therefore set a “bad” precedent, according to the Premier League.

Following the EU’s surprising move, the Premier League’s Head of International Football relations and EU affairs, Mathieu Moreuil, said “we’re very concerned that sports content is included in the scope of radio programs. Such a last-minute change without any justification and an open and transparent discussion is very disappointing”.

The new rules will have an impact on organisations such as the Premier League. The Premier League generates considerable revenue from the sale of rights on a market-by-market basis. By allowing the licensing of radio broadcasts for sports, this would undermine control over territorial rights and the value attached to those rights.

The battle between promoting a single market and protecting individual IP rights continues, and the EU’s most recent stance has gone against sports rights holders such as the Premier League. Will the EU legislators hear the sports industry’s complaints? They have changed their minds once, time will tell whether they will do so again…

FINA changes its stance after World Champion swimmers’ antitrust claims throw it into the deep end

On 15 January 2019, the Fédération Internationale de Natation (“FINA”), the gatekeeper for access to the Olympic Games and World Championships, announced that swimmers are now free to participate in race meetings that are organised by independent organisers (which includes those that are neither related to FINA or members of FINA) and will not be banned from competing in major championships as a result of doing so.

This statement comes after three international champion swimmers, Thomas A. Shields (USA), Michael C. Andrew (USA) and Katinka Hosszu (Hungary) filed lawsuits in the Northern District of California on Friday 7 December 2018 against FINA following allegations that FINA boycotted a potential competition by the International Swimming League (“ISL”) which was planned to take place in Turin during December 2018. FINA had warned athletes that they may be banned from competing in the Olympics if they competed in the ISL competition.  The swimmers sought compensation against FINA and an injunction for “clear antitrust violations arising from FINA’s complete control, by unlawful means, over the promotion and organization of international swimming competitions and its efforts to ensure that FINA, and only FINA, can determine what swimming athletes will be paid for their efforts.”  The ISL also brought a separate suit, alleging that FINA behaviors were anticompetitive.

The claims focused on two key areas: (i) the low prize payments given by FINA to the athletes and (ii) the fact that FINA has used its position to boycott the efforts of a new professional league.

Prize Payments

According to World Champion Swimmer Michael Andrew, “very few select swimmers make a living swimming, while FINA is making a killing.” It is alleged that only 12.5% of FINA’s gross revenues from aquatics events in 2016 and 2017 went to athletes in prize money. Athletes received a combined total of only USD $15 million out of the USD $118 million that FINA earned.

The swimmers alleged that “the mere threat of ISL’s market entry has already increased pay for swimmers in the market in which FINA has been unlawfully suppressing competition, which demonstrates one element of anti-competitive harm — depressed swimmer compensation — that FINA’s illegal stranglehold has imposed on the market.”

On 5 December 2018, FINA announced that it may consider introducing new events that, the lawsuit claims, are similar to the events proposed by ISL. FINA also announced an increase in prize money for the FINA World Swimming Championships. However, the swimmers claimed that these were only in reaction to the swimmers’ responses to FINA’s blocking of ISL’s event.

Blocking Access

The complainants argued that FINA had used its dominant position in the market to retain huge revenues from some of the best swimmers in the world.  It was also noted that USA Swimming (the US swimming governing body) had initially supported ISL and worked with ISL to arrange an event in December 2018, but then withdrew from these negotiations due to mounting pressure from FINA.

These claims stood against the backdrop of the European Commission investigation into the International Skating Union (“ISU”) which began with the European Commission’s announcement on 27 September 2016. ISU had stated that any speed skaters choosing to compete in Dubai’s Ice Derby would face a permanent ban from competing at international events such as the Olympics. In December 2017, the Commission decided that ISU rules giving penalties to athletes for engaging in unauthorised speed skating events breached competition law. ISU now has the obligation to amend these rules.

As a result, FINA’s announcement that swimmers will not be banned as a result of participating in unaffiliated competitions is welcomed and may signal a significant change in the governance of sport. However, FINA has also stated that independent organisers are required to “cooperate with or seek the approval of FINA or any relevant member federation” should they intend “to have the results and records of any competitions or events duly registered with and acknowledged by FINA”.  The tensions between commercial entities, professional leagues and associations with control over access to key sporting events, such as the Olympics, are still at a high.

Avant Garde by name, avant-garde by nature: French Football Federation ruling threatens to stop real-life fantasy team

When French sixth-tier side Avant Garde Caennaise (“AG Caen”) were founded in 1902, even the most forward-thinking supporters could not have imagined that the club would become the pioneers that they are today.

The Project

Two thousand fans currently manage the team, making decisions such as the team’s line up and substitutions, via a third party app called ‘United Managers’. The virtual managers, called ‘Umans’, decide on pre-game line-ups and in-game tactics.  They have access to Opta Pro statistics and live streaming of training sessions and games and vote on the app to make strategy-critical decisions.  The app delivers the tactics digitally for the dugout duo of Julien Le Pen and assistant Karim Ahmed Yahia to implement.

The United Managers project is based on a subscription model where users vote with coins on the app.  Umans can pay for a premium subscription or earn greater voting rights with their increased use of the app.  Fans can spend hours watching their team train, considering player selection, formations and suggesting substitutions.  If Le Pen wants to make a substitution, the Umans also have the right to vote against his choice.  This is fantasy football in reality.

But does it work? Are the Umans the next Guardiola?  Well, the team’s performance seems to speak for itself in this regard.  The team is currently top of Regional 1, one of the regional leagues at the sixth tier of French football, and is on course for promotion to the Championnat National 3 (the fifth division) if they keep up their current form.

FFF ruling

The French Football Federation (“FFF”) have now moved to shut down the United Managers concept.

When the AG Caen project started in July 2017, the Normandy Football League reportedly approved the idea, allowing United Managers to implement the collaborative coaching concept.

However, nine clubs in AG Caen’s league have raised issues with the project.  It has now transpired from recently published minutes that the FFF outlined changes to the regulations in an assembly meeting on 8 December 2018.

The new rules prescribe:

  1. Clubs cannot enter into contracts or partnerships that allow third parties to influence the performance of its team;
  2. Third parties cannot question the responsibility of the team held by the head coach by influencing his choices in relation to team management; and
  3. Clubs cannot broadcast live matches without the prior consent of the league (in accordance with Article L333-1 of the French ‘Code du sport’).

This new guidance does not appear to be the end of the matter, at least as far as United Managers are concerned.  The company have released a statement and have signalled their intent to challenge the decision.  They say that preparations will continue as normal for AG Caen’s next game in two weeks’ time.

Comment

With the advancement of technology in sport and the popularity of fantasy football games, it is inevitable that we will see more projects of this kind launching around the world.  The app-based concept may prove more popular and successful than similar projects have fared in the past.  A recent example is the takeover of English Conference side Ebbsfleet United by MyFootballClub in 2007.  Although similar to United Managers’ partnership with AG Caen in that members could pick the team, MyFootballClub was not a subscription service but rather a crowd-funding take-over of a business.  Ultimately, the take-over failed because of declining membership and investment.

It remains to be seen if other governing bodies will take the same approach as the FFF or instead seek to embrace the concept.

The benefits could be great in terms of community engagement, performance levels and commercialisation.  However, there are clearly also issues to address, not least in relation to the ownership of image and broadcasting rights.  Furthermore, the concept could threaten the sanctity of team independence and could obviate the need for a traditional ‘manager’ altogether.

There are a number of questions:  How can the concept prevent a group of hostile rival fans – or even hackers – taking over to sabotage the team?  Should the virtual managers be subject to coaching licence requirements?  How will rules on betting be applied and enforced?

Governing Bodies and Sports Clubs will need to stay ahead of the game as current regulations may not be sufficient to cover such tech-based projects.

UEFA TV: A glimpse into the future?

UEFA recently announced that it will be launching its own over the top (“OTT”) streaming platform within the next few months. When the provisionally named ‘UEFA TV’ goes live in time for the 2019/20 season, it will allow fans outside of Europe and North America to view Euro 2020 and future editions of the UEFA Nations League. Due to UEFA’s existing carriage agreements, it is unlikely that its premier club competitions, the Champions League and the Europa League, will be coming to UEFA TV until 2021 at the earliest.

Sports Shorts has discussed the evolving landscape of the sports broadcasting market and the growing prevalence of OTT platforms previously, but UEFA’s latest move signifies a change of tack from one of football’s major content licensors. Away from the lucrative European and North American broadcast markets, UEFA have presumably concluded that a direct-to-consumer approach will provide them with more revenue and more control over their relationship with consumers. In announcing the launch of UEFA TV, newly re-elected UEFA president Aleksander Čeferin spoke of UEFA’s desire to make football more accessible to fans across the globe. This may indicate a flexible pricing structure for the new platform, with single-match passes and/or tournament passes amongst the possible approaches that UEFA could take.

As markets mature, UEFA may seek to increase prices for UEFA TV to drive revenue growth, but its first mission will be to establish UEFA TV as a platform and garner sufficient subscribers to make it a profitable venture. Given the popularity of European football around the world, this would seem to be an inevitability, particularly once UEFA is able to offer the Champions League on its platform.

Aside from the revenue UEFA expects to generate from subscribers, it will supplement its income from UEFA TV through agreements with sponsors and advertisers. Indeed, in launching the platform, UEFA announced a sponsorship deal with Chinese e-commerce behemoth, the Alibaba Group. The expectation on UEFA’s side appears to be that this agreement will develop into a broader partnership in a number of areas. More sponsorship deals may be in the offing as UEFA TV’s launch date draws closer.

Stepping into the role of broadcaster will put even more of an onus on UEFA to combat the infringement of copyright in its content. Fighting piracy can involve a significant amount of resources, which could hit UEFA’s bottom-line. UEFA hasn’t been passive in protecting its content, even when licensing it to others, but, if UEFA retains exclusive broadcast rights to its competitions, it will not be able to rely on broadcaster-licensees taking action against infringers.

It is not yet clear if UEFA intends to disseminate its content exclusively through UEFA TV or if it will continue to enter into carriage agreements with local broadcasters to air UEFA competitions on linear television or other traditional mediums. Local variables such as consumers’ access to high-speed internet are likely to play a part in UEFA’s decision-making in this respect. Regardless, the launch of UEFA TV marks a significant moment in football broadcasting and it will be intriguing to see if UEFA looks to roll out the same model to European and North American markets when its current carriage deals expire.

Raheem Sterling’s Penalty: If the referee knew, could he have overturned it?

The penalty given in the early stages of the Champions League fixture between Manchester City and Shakhtar Donetsk on Wednesday night has been hailed as amongst the worst penalty decision[s] ever” by the BBC. Since there was no VAR and the fourth official appeared silent on the issue, the penalty stood and Gabriel Jesus put City up 2-0.

Aside from the “meme-ageddon” that has followed, Sterling has received criticism from his harshest critics who have claimed that he should have been more forceful in explaining to the referee what had actually happened. Others have highlighted the fact that he did not seek to claim a penalty in any way and that the referee immediately awarded the penalty when he went to ground.

What is the law and would any protestations have made a difference anyway?

Continue Reading

Motorsport’s new proposed ‘W Series’ – a chance for female drivers to move to the front of the grid?

I don’t know whether a woman would physically be able to drive an F1 car quickly, and they wouldn’t be taken seriously.

I don’t know if they’ve got the mental aptitude to race hard, wheel-to-wheel.

Regrettably, these inflammatory comments were not made by loose-lipped pub-goers, but by former F1 CEO Bernie Ecclestone and International Motorsports Hall of Famer Sir Stirling Moss, respectively.

Given their stature, the picture of an ‘all-boys club’ is easy to visualize. However, it appears that change is on the horizon. In May 2019, a new Formula 3 championship called the “W Series” will be launched, with a very distinct USP: all its racers will be women.

In an interview conducted by The Drive with W Series Communications Director, Matt Bishop, the following information has been gleaned:

  • W Series has appointed the British Racing & Sports Car Club (BRSCC) as the organizing club.
  • All the backing for season one—about £20 million (US $26.4 million) will be provided by one major shareholder, Sean Wadsworth.
  • W Series expects to sign 18 drivers for season one, all of whom must be at least 17 years of age, have competitive racing history, and must have completed an appraisal process stated to involve simulator and on-track testing, as well as engineering exams and physical fitness trials.
  • Those selected will be funneled into rigorous training programs, each run by instructors with Formula 1 experience. Tutelage by Grand Prix winner David Coulthard and simulator time will augment driving, while technical understanding will be aided by engineer Adrian Newey. Former McLaren management man Dave Ryan and former McLaren communications officer Matt Bishop will train drivers to master media interaction.
  • For the 2019 season, the W Series calendar is expected to encompass six half-hour sprint races at racetracks across Europe. In 2020 and beyond, the calendar could expand to regions such as the United States, Australia, and Asia.
  • At the end of the season, a prize money pot of $1.5 million will be divvied up between the entire grid. The winner will take home $500,000, and there will be decreasing payouts awarded all the way down to 18th place in the final standings.

Continue Reading

The $365 million man: Canelo lands bumper deal in changing sports broadcasting market

The richest athlete contract in sports history”. That is how ESPN described the deal between boxer Saul ‘Canelo’ Alvarez and streaming service DAZN, which is worth a reported $365 million for 11 fights.

The agreement with Canelo sits alongside a broader “exclusive” partnership between DAZN and Canelo’s promoter, Golden Boy Promotions, which is due to run until 2023. DAZN has certainly made a statement to its competitors with the deal, as the UK-based company adds to its stable of combat-sport content.

The scale of Canelo’s remuneration has already prompted rival boxer Gennady Golovkin to consider his next move very carefully, given his current status as a broadcast ‘free-agent’.

Perhaps more significantly the deal is the latest indication of a shifting landscape in sports broadcasting, away from traditional linear TV broadcasters and towards standalone over the top (“OTT”) service providers such as DAZN. Indeed, Eleven Sports have recently made waves in the UK, acquiring the rights to broadcast various European football leagues, including La Liga and Serie A, via its streaming platform.

Continue Reading

Will the American League Baseball finals be decided by the actions of a fan?

The beginning of October saw the start of the postseason in Major League Baseball and we are now at the finals stage in both the National and American League competitions.

In the American League, the LA Dodgers lead the Milwaukee Brewers 3-2 in the best of 7 series, whilst last night the Boston Red Sox sealed a 8-6 victory over the Houston Astros, to take a 3-1 lead in the series.

However, last night’s game was not without controversy as a two-run home run was cancelled as a result of the umpires’ finding that an Astro’s fan had interfered with the play.

What happened?

At the bottom of the first innings, and with George Springer on first base, Houston’s designated hitter Jose Altuve, smashed a fly ball to the right-hand side of the field in what looked like it would be a home run.

Red Sox right-fielder, Mookie Betts, launched himself backwards in an attempt to make the catch but in the process closed his glove too early, meaning the ball dropped back into the field of play, with both batsmen making it home safely.

However, following the play, the right-field umpire ruled that Altuve was out as a result of “spectator interference”. Protests ensued from the Astro’s bench before, having taking their time to consider the replays in more detail, the Umpires upheld the original decision with Altuve out and Springer having to return to first base.

A video of the incident can be viewed on the MLB twitter account here.

What are the rules?

Continue Reading

Ben Stokes & Alex Hales: Disciplinary Matters in England and Wales Cricket

Given its escalation all the way to the Bristol Crown Court, even the casual sports fan will have noted the media furore regarding Ben Stokes and the street brawl he engaged in last September.

Although Stokes was found not guilty for the offence of affray, he has not escaped all liability for his actions just yet.

At the same time as Stokes was charged by the Avon and Somerset Police, both Stokes and Alex Hales were charged internally by the England governing body for cricket, the England and Wales Cricket Board (ECB).

What were they charged with?

Both players were referred to the independent Cricket Discipline Committee (CDC) and charged with two counts of breaching ECB directive 3.3, which states:

“No participant may conduct themselves in a manner or do any act or omission at any time which may be prejudicial to the interests of cricket or which may bring the ECB, the game of cricket or any cricketer or group of cricketers into disrepute.”

These types of clauses in governing bodies’ regulations are commonly used as sweeper provisions, to punish participants for actions away from the field of play.

How will the disciplinary process work?

Continue Reading

Eleven Sports challenges football ‘Blackout’ by broadcasting La Liga games

Eleven Sports, the global sports provider, has contravened UEFA rules, which prohibit live coverage of football in the UK between 14:45 and 17:15 on Saturdays by broadcasting Barcelona’s La Liga fixture against Athletic Bilbao.

This period on a Saturday afternoon is commonly referred to as the football “blackout” as the UK does not broadcast any matches during this period. It is at this time that football fans will instead turn to Jeff Stelling and Co. for their fix of football updates.

Eleven Sports broadcast the La Liga fixture in the UK despite a 15:15 BST kick off. Eleven Sports then streamed Getafe versus Levante the following weekend at the same time. Andrea Radrizzani, its founder, has recently said that the broadcaster will continue to broadcast live La Liga matches during the Saturday blackout window.

Article 48 of the UEFA Statutes grants UEFA and the Member Associations the exclusive rights to broadcast any matches within their jurisdiction. The regulations governing the implementation of Article 48 provide further detail:

  • Article 3(1) refers to “transmission-free periods” where Member Associations may decide on a two and a half hour period on a Saturday or Sunday during which any transmission of football is prohibited within the territory of the Member Association.
  • Article 3(3) requires that the chosen hours of a Member Association should correspond to the “main domestic fixture schedule”, which is defined as corresponding to the time when the majority (50% or more) of the weekly football matches in the top or top two domestic leagues are played.

This corresponds to the set of fixtures played at 15:00 on a Saturday in the UK.

Continue Reading

LexBlog