Subscriber Only

Noel Whelan: State must face down threats from pay TV

Irish channels have every right to charge international cable firms for retransmission

In the midst of parliamentary committee deliberations one occasionally comes across an exchange which encapsulates the stark choices at the centre of policymaking.

I have often been critical here of the pace of lawmaking in the current Dáil and Seanad. It is worth acknowledging, however, that solid work is being done in Oireachtas committees, especially at the pre-legislative stage.

Last October, Minister for Communications Denis Naughten sent the draft outline of a proposed Broadcasting (Amendment) Bill to the relevant Oireachtas committee.

The committee, which is chaired by Fine Gael's Hildegarde Naughton, is currently holding hearings with stakeholders in order to inform the finalisation of the Bill.

What Naughten is proposing is a short Act dealing with issues related to the funding of public service broadcasting.

The proposal that attracted the most interest initially was his plan to amend the law so the government can tender out the contract for the collection of TV licences. This is an initiative aimed at resolving Ireland’s disastrous compliance in this area.

However, another important issue which the Minister has asked the committee to consider is what are called retransmission fees.

This is the question of whether RTÉ, TV3 and TG4 should be allowed to charge pay-TV platforms like Sky and Virgin for putting their channels on cable platforms.

It will surprise many readers to learn that, whereas the Irish channels are obliged by law to provide their scheduled content to the cable platforms, they are prohibited by the same law from charging anything for it.

The notion of legally hobbling the State broadcaster and other native channels as they compete with big international pay TV seems utterly arcane

This prohibition on seeking retransmission fees was originally put in place at a time when most of us lived in two-channel land and was meant to encourage the rollout of cable networks and greater diversity in transmissions and access to television content.

Since then, of course, the broadcasting environment has been completely transformed.

Nowadays, the notion of legally hobbling the State broadcaster and other native channels as they compete with big international pay TV seems utterly arcane.

Expert view

For the July meeting of the Oireachtas committee, RTÉ arrived armed with an expert study by the media advisory company Mediatique which suggested that RTÉ could be able to charge Sky €19 million a year and Virgin €11 million for retransmissions.This was the background to this week's exchanges at the committee.

On Tuesday evening, Sky, Virgin, Eir and Vodafone got to give their reply to the Minister's proposals, and unsurprisingly all were opposed to allowing RTÉ, TV3 and TG4 to negotiate a fee for their channels.

Sky's director of public affairs David Wheeldon flatly told the committee that Sky doesn't pay for free-to-air channels elsewhere and that there were "no circumstances" in which it would pay for RTÉ.

As Laura Slattery reported in Wednesday's Irish Times, the committee members responded robustly. Fianna Fáil's communications spokesman Timmy Dooley, for example, pulled Wheeldon up on the remarks, saying: "That doesn't sit well with me as a legislator to be told that by Sky."

Wheeldon apologised if his comments were interpreted as a threat and went on to claim that Sky’s customers “did not buy Sky to buy RTÉ”.

Of course they don’t. However, RTÉ and TV3 are by far the most popular channels. Irish customers currently subscribe to Sky in the knowledge that it includes RTÉ and TV3, along with the advantage of having the channels on one platform with other choices and associated add-ons like recording and delayed viewing.

One wonders whether Sky or Virgin could ever have grown their business in Ireland if they didn't have RTÉ or TV3. Suggesting that they would not carry the native stations in the future is spin.

A blackout of the Irish channels by any of the pay-TV platforms would be cutting off their noses to spite their faces

They are already facing demands for retransmission charges and law changes in other countries including the UK, especially from ITV.

Freeing RTÉ, TV3 and TG4 from the legislative prohibition on charging for retransmission would no doubt lead to some tough negotiations and maybe even a standoff over whether Sky and Virgin would carry the Irish channels at all.

A blackout of the Irish channels by any of the pay-TV platforms would be cutting off their noses to spite their faces, especially if RTÉ was able to keep their channel available on competitor platforms for a fee.

Any such negotiations would inevitably involve an element of playing the pay-TV companies off against each other.

The international pay-TV companies are now dominant in the Irish broadcasting marketplace. They have made massive monies on the back of free Irish-made content.

Allowing RTÉ, TV3 and TG4 to seek fees for retransmission would not only level the playing pitch, but would also generate significant additional monies to support public service broadcasting, to fund Irish programme-making and Irish broadcast journalism, without further cost to the exchequer.

For Irish taxpayers and licence-payers it’s a no-brainer. The proceedings of the Oireachtas committee suggest that most of our legislators are tending towards the same view.