Original URL: http://www.theregister.co.uk/2012/05/10/optus_talks_ad_dollars_in_tv_now_case/

Optus CEO: Our ads pay for TV, so let TV Now live

Veiled threat or novel argument?

By Richard Chirgwin

Posted in Business, 10th May 2012 22:17 GMT

Broadcasters should support, rather than opposing, Optus’ TV Now service, the carrier’s CEO believes, because Optus is a major TV advertiser.

The company has apparently taken AFL boss Andrew Demetriou’s advice to “think very carefully" about challenging the company’s April TV Now loss in in the Federal Court, and decided it’s worth a shot.

However, explaining the decision to the Australian Broadcasting Corporation’s television news yesterday (11 May), CEO Paul O’Sullivan advanced a novel argument: Optus, as an entity that spends around A$30m a year on commercial TV advertising already helps fund television sport broadcasts, and that its customers should not have to “pay twice” to watch sports.

“That advertising funds free-to-air broadcasts and, from our point of view, our technology is merely allowing Australians to record these free-to-air broadcasts to watch them at a more convenient time,” he said, in what sounds to El Reg like it’s also a veiled threat about its advertising spend.

Returning to a line more likely to play in a High Court appeal, he added that the service is “really just a modern version of the video recorder” – albeit one that can record and replay almost simultaneously, can stream to four different formats, and lives in a big server farm.

When sued by the Australian Football League and Australian Rugby League (with the support of Telstra, which had paid more than $150 million for exclusive rights to rebroadcast matches to mobiles), Optus had first won in the Federal Court, and then lost on appeal. Its first hurdle will be to get the High Court to accept that there are grounds for an appeal. ®