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Time to say no to Fifa...
As South Africa 2010 draws closer, and the prospect of blank screens in Singapore looms, there are growing calls by football fans for SingTel and StarHub to step up and do 'national service'.
Football fans want Singapore's two pay-TV providers to cough up the king's ransom that the International Federation of Association Football (Fifa) is demanding in return for 'live' broadcast rights to the World Cup, the premier sporting event on this year's calendar.
Judging from the buzz among sports lovers and online, it's a popular call in football-crazy Singapore. This is especially after the recent furore over English Premier League (EPL) telecasts when football fans complained about having to switch providers or get another set-top box, after SingTel wrested the EPL from StarHub. There's a clear limit to how much football fans are prepared to pay to get their live TV fix.
Apart from the EPL upset, last year ended with more shock for football fans: SingTel and StarHub said last month they had yet to reach an agreement with Fifa on World Cup broadcast rights.
Considering that more than 200 countries from Malaysia to Montenegro have already secured these rights, the announcement is an ominous sign, even though negotiations are continuing.
SingTel and StarHub said they had offered Fifa more money than the contract price for the 2006 World Cup. They did not disclose the sum, but said it was high enough to require both companies to 'sacrifice all World Cup margins... while keeping the price affordable for consumers'.
In other words, the two telcos did not think Singapore football fans would pay the higher fees that Fifa is demanding. It's not clear how much Fifa wants, but regional broadcasters say the going rate is three to five times 2006's fees.
Fifa's fees are reportedly based on a country's per-capita income, which explains why African countries can afford Fifa's asking fees while Singapore, which enjoys the 20th highest per-capita income in the world, is baulking. It bears repeating that the World Cup, a month-long event that takes place once every four years, is a different animal to other pay-TV programming.
Unlike the EPL, TVB soap operas or the Crime Scene Investigation franchise, which give pay-TV providers who offer such programmes the chance to raid a rival's customer base for long-term profit, one-off events like the World Cup offer little commercial advantage.
Even so, StarHub, previously, and Malaysia's Astro, currently, were willing to do 'national service', biting the bullet and reaching into their coffers to reward loyal long-time sports-loving customers who expect their pay-TV provider to deliver football content.
Now that SingTel has wrested the EPL from it, StarHub has no reason to subsidise the World Cup. As for SingTel, being able to offer the World Cup is nice, but unnecessary to its goal - greater market share - since it already has pay-TV's crown jewel, the EPL.
So despite the popular calls, it makes little sense for the telcos to pay whatever Fifa demands.
In fact, it is in Singapore's national interest if they stand their ground. Since Temasek Holdings is the main shareholder of both telcos, with a 55 per cent stake in SingTel and 56 per cent of StarHub, how well the telcos do has a downstream effect on it.
Temasek reinvests earnings from investments into new or bigger stakes in companies to grow the national kitty; it also sends a portion of its earnings to its sole shareholder, the Ministry of Finance. In addition, SingTel shares are held by many retail shareholders, a legacy of its 1993 initial public offering, when two of its three share tranches were reserved for Singaporeans.
To put it baldly, if football fans get their way, it means non-football fans are subsidising their passion.
SingTel and StarHub have to be fair to their shareholders, which include Temasek and many ordinary Singaporeans. They also have to be fair to all their customers, not just their sports-crazy ones. Giving football fans their fix for World Cup matches live on local television channels simply doesn't qualify as 'national service'.
If commercially-run companies won't subsidise fans' World Cup viewing, neither should the state, despite unrealistic calls by some fans for the Government or national broadcaster MediaCorp - wholly owned by Temasek - to make good the difference between what fans are willing to pay and what Fifa wants. There is one other good reason for taking a stand against a decision that is not viable commercially: The wrong signal doing otherwise would send to Fifa.
Let's say Singapore pays what the barons of Zurich want. What will the fees for Brazil 2014 be like? Unthinkable as it is, the time has come to tell Fifa: 'Take it, or leave it.'
Football is the de facto national sport here, and much of the country enters a discreet go-slow during the World Cup. Sure, it would be a travesty if Singaporeans have to resort to tuning to Indonesian TV to catch the likes of Kaka, Fernando Torres and Cristiano Ronaldo in June. But it won't be life-threatening. And the rewards could be long lasting.
Make no mistake: The only way Fifa will get the message is if their biggest fans play hardball. Admittedly, tiny Singapore's refusal may not sway Fifa, which rakes in an estimated $4.5 billion from TV and sponsorship rights. Even so, other broadcasters cannot be wholly happy about Fifa's seemingly insatiable appetite. They may have ponied up because Fifa demanded less of them than it did of us for now, but they are wary too of being pushed into a corner.
Tiny Singapore's refusal to bow to Fifa's high fees this time may well be the flickering candle that grows into a larger flame next time round. After all, football fans are customers too, and no one likes being pushed around by big business.
And Fifa might want to consider asking the music and movie industries how their experiment with ignoring customers, at a time when admittedly illicit alternatives are available online, turned out for them.
Source from The Straits Times dated 7 January 2010
Football fans want Singapore's two pay-TV providers to cough up the king's ransom that the International Federation of Association Football (Fifa) is demanding in return for 'live' broadcast rights to the World Cup, the premier sporting event on this year's calendar.
Judging from the buzz among sports lovers and online, it's a popular call in football-crazy Singapore. This is especially after the recent furore over English Premier League (EPL) telecasts when football fans complained about having to switch providers or get another set-top box, after SingTel wrested the EPL from StarHub. There's a clear limit to how much football fans are prepared to pay to get their live TV fix.
Apart from the EPL upset, last year ended with more shock for football fans: SingTel and StarHub said last month they had yet to reach an agreement with Fifa on World Cup broadcast rights.
Considering that more than 200 countries from Malaysia to Montenegro have already secured these rights, the announcement is an ominous sign, even though negotiations are continuing.
SingTel and StarHub said they had offered Fifa more money than the contract price for the 2006 World Cup. They did not disclose the sum, but said it was high enough to require both companies to 'sacrifice all World Cup margins... while keeping the price affordable for consumers'.
In other words, the two telcos did not think Singapore football fans would pay the higher fees that Fifa is demanding. It's not clear how much Fifa wants, but regional broadcasters say the going rate is three to five times 2006's fees.
Fifa's fees are reportedly based on a country's per-capita income, which explains why African countries can afford Fifa's asking fees while Singapore, which enjoys the 20th highest per-capita income in the world, is baulking. It bears repeating that the World Cup, a month-long event that takes place once every four years, is a different animal to other pay-TV programming.
Unlike the EPL, TVB soap operas or the Crime Scene Investigation franchise, which give pay-TV providers who offer such programmes the chance to raid a rival's customer base for long-term profit, one-off events like the World Cup offer little commercial advantage.
Even so, StarHub, previously, and Malaysia's Astro, currently, were willing to do 'national service', biting the bullet and reaching into their coffers to reward loyal long-time sports-loving customers who expect their pay-TV provider to deliver football content.
Now that SingTel has wrested the EPL from it, StarHub has no reason to subsidise the World Cup. As for SingTel, being able to offer the World Cup is nice, but unnecessary to its goal - greater market share - since it already has pay-TV's crown jewel, the EPL.
So despite the popular calls, it makes little sense for the telcos to pay whatever Fifa demands.
In fact, it is in Singapore's national interest if they stand their ground. Since Temasek Holdings is the main shareholder of both telcos, with a 55 per cent stake in SingTel and 56 per cent of StarHub, how well the telcos do has a downstream effect on it.
Temasek reinvests earnings from investments into new or bigger stakes in companies to grow the national kitty; it also sends a portion of its earnings to its sole shareholder, the Ministry of Finance. In addition, SingTel shares are held by many retail shareholders, a legacy of its 1993 initial public offering, when two of its three share tranches were reserved for Singaporeans.
To put it baldly, if football fans get their way, it means non-football fans are subsidising their passion.
SingTel and StarHub have to be fair to their shareholders, which include Temasek and many ordinary Singaporeans. They also have to be fair to all their customers, not just their sports-crazy ones. Giving football fans their fix for World Cup matches live on local television channels simply doesn't qualify as 'national service'.
If commercially-run companies won't subsidise fans' World Cup viewing, neither should the state, despite unrealistic calls by some fans for the Government or national broadcaster MediaCorp - wholly owned by Temasek - to make good the difference between what fans are willing to pay and what Fifa wants. There is one other good reason for taking a stand against a decision that is not viable commercially: The wrong signal doing otherwise would send to Fifa.
Let's say Singapore pays what the barons of Zurich want. What will the fees for Brazil 2014 be like? Unthinkable as it is, the time has come to tell Fifa: 'Take it, or leave it.'
Football is the de facto national sport here, and much of the country enters a discreet go-slow during the World Cup. Sure, it would be a travesty if Singaporeans have to resort to tuning to Indonesian TV to catch the likes of Kaka, Fernando Torres and Cristiano Ronaldo in June. But it won't be life-threatening. And the rewards could be long lasting.
Make no mistake: The only way Fifa will get the message is if their biggest fans play hardball. Admittedly, tiny Singapore's refusal may not sway Fifa, which rakes in an estimated $4.5 billion from TV and sponsorship rights. Even so, other broadcasters cannot be wholly happy about Fifa's seemingly insatiable appetite. They may have ponied up because Fifa demanded less of them than it did of us for now, but they are wary too of being pushed into a corner.
Tiny Singapore's refusal to bow to Fifa's high fees this time may well be the flickering candle that grows into a larger flame next time round. After all, football fans are customers too, and no one likes being pushed around by big business.
And Fifa might want to consider asking the music and movie industries how their experiment with ignoring customers, at a time when admittedly illicit alternatives are available online, turned out for them.
Source from The Straits Times dated 7 January 2010
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