Out-Law News | 30 Jul 2013 | 2:57 pm | 2 min. read
The Media Development Authority (MDA) said SingNet was exempt from rules that would have required the company to cross-carry channels where BPL coverage was bundled with other content on a platform operated by rival StarHub. SingNet was, though, told to make its standalone BPL coverage available to StarHub subscribers on the same terms as it is available to its own customers.
The MDA said that its decision was justified in the interests of both the public and the media industry in Singapore.
Following the decision SingTel, the pay-TV subsidiary of SingNet, announced a two-tiered pricing structure for access to BPL content. For new customers wishing to access BPL content on its own, including StarHub customers, a monthly fee of SIN$59.90 (£30.00) will apply. BPL channels bundled together with other content will cost SingTel customers between SIN$64.90-69.90 (£32.50-35.00), according to a report by Singapore Law Watch. Previously SingNet charged customers SIN$34.90 (£17.50) a month for its sports bundle package, which included BPL coverage, according to a report by Strait Times.
"The availability of the BPL Bundles, in addition to the Standalone BPL, would allow SingNet to reap economies of scale, resulting in lower prices for all subscribers regardless of the platform they are accessing the BPL Content," the MDA said in an information circular to the pay-TV industry in Singapore.
"Cross-carrying a high number of duplicative channels in the BPL Bundles and [StarHub's] content offerings is likely to result in consumer confusion and dissatisfaction; and it would be in consumers’ interest to have the option to purchase the standalone BPL on either the SingNet platform or the [licensees'] relevant platform(s)," it said.
Another factor in the MDA's decision was that SingNet would not use its revenues from showing the BPL content to subsidise the other content it provides access to its subscribers to in its bundle packages.
"The cost savings from the economies of scale due to the BPL Bundles would be applied to all BPL subscribers, regardless of the platform of access, resulting in a lower subscription price for the Standalone BPL for all consumers, as compared to a higher subscription price for the Standalone Pack should the exemption not be granted," the regulator said. "MDA has noted that bundling has generally been accepted as the operating model of the pay TV industry, including [StarHub]."
Media law expert Bryan Tan of Pinsent Masons MPillay, the Singapore joint law venture partner of Pinsent Masons, the law firm behind Out-Law.com, said that the cross-carriage rules "will eventually regulate the behaviour of those seeking to secure advantages with exclusive content deals".
"As SingTel has now announced its higher pricing, the government has stood its ground in the belief that the rules will benefit consumers in the long run even though in the shorter term, prices have increased," Tan said. "The logic seems to be that as long as SingTel wishes to cross-subsidise the exclusive content with its other content, it can do so but it must offer the exclusive content to customers of its competitors."
"The government also signalled that it will be reviewing the definition of exclusive contracts to pre-empt attempts to circumvent the rules," he added.