The government’s review of the anti-siphoning scheme looks set to further entrench the power of the free-to-air broadcasters over sports rights holders.

The scheme restricts subscription television from bidding for broadcast rights for a range of sports, punishing rights holders and reducing the revenue they can earn from broadcasting.

A legislated review was required to have been started by the end of 2009, and the government produced a discussion paper in August last year.

Rights holders, and particularly the AFL, are keen for the review to be completed and for the government to declare its hand. The current scheme expires at the end of this year, and the longer the future of the scheme remains uncertain, the longer the AFL remains in limbo over negotiations for its next rights contract, for the 2012 season onward.

Crikey understands from government and industry sources that the AFL has been proposing that the scheme be amended to allow for four of its eight matches to be delisted, reflecting the current split between FTA broadcasters and Foxtel.  This split has long been considered an option but is administratively and legally complex, and would have to address the AFL’s concern to have a local FTA match in the Perth and Adelaide markets every week.  Moreover, it is understood that the AFL has got cold feet on the idea, as it may lead to Foxtel, via Premier Media Group, being the only bidder for the delisted four matches.

Crikey also understands that Minister Conroy will propose a 10-year extension of the list rather than the current five-year extension, which will infuriate the subscription television sector.

It is also understood that Conroy will — and this was flagged by John Durie in an excellent piece in The Australian on the weekend — propose to extend the anti-siphoning list to the internet.  While the government’s discussion paper admitted that internet exclusivity was a non-issue currently, it flagged that with the National Broadband Network, it would be possible to reach a national audience without FTA or subscription broadcasting.

Given Conroy is already proposing a ham-fisted “mandatory internet filter”, this will further strengthen the perception that this government sees the internet as a threat to be regulated.  And like the internet filter, an online version of the anti-siphoning scheme will probably target ISPs, which are already regulated under the Broadcasting Services Act, even though they would only be the delivery mechanism for anti-siphoning content, rather than the actual content providers.  The current scheme uses the BSA’s licensing framework to impose licence conditions preventing subscription television broadcasters from carrying listed events, but internet content providers are not licensed and may not even be located in Australia.

The two other issues in the government’s response are whether to permit FTA multi-channelling of listed events, and the future of “use it or lose it”.  The two issues are related by the previous government’s 2006 media reforms.  There is a policy rationale for permitting multi-channelling of listed events, but it is a die-in-a-ditch issue for the subscription sector.  The latter were promised much in 2006 but in the end only got a ban on FTAs using their multi-channels — which were enabled by the 2006 reforms after years of stalling from the FTAs — to broadcast listed events.

Multi-channelling will remove virtually any incentive for FTAs to share rights to complex, simultaneous-event sports such as the Olympics or the Australian Open tennis, or even the football codes, with subscription television, as happens now.  The subscription sector will be deeply aggrieved if the multi-channelling ban is removed in the absence of a truly major reduction of the list.

“Use it or lose it” — the principle that if FTAs did not cover a listed event, it was removed from the list — was also offered to the subscription sector in 2006.  The sector failed in an attempt to get a legislated “use it or lose it” scheme but Helen Coonan set up an ACMA monitoring process to report on how much (or, for many events, how little) the FTAs actually broadcast of listed events, to form the basis of  decision-making process (the anti-siphoning list can be made and amended by the minister — no parliamentary approval is required).  As the 2007 election neared, however, the Howard government lost interest in amending the list to remove even events that no one was interested in, like the French Open.

“Use it or lose it” is still notionally government policy — Conroy backed the principle before the election has said nothing to disown it since, but he shut down ACMA’s monitoring of FTA coverage.  Any “new” announcement of “use it or lose it” would need to be backed by a legislative mechanism to automatically remove events that weren’t covered by the FTAs.  The subscription television sector won’t be suckered again by politicians making promises that become electorally inconvenient to keep.

The Minister’s office this morning would only say that the Government was considering its response to the anti-siphoning review “and will respond in due course.”