In mid-September, Australian pay-TV channel Odyssey started circulating a petition via email and on its website, asking supporters to encourage Aussie pay-TV carriers Optus and Foxtel to pick up the doc channel. Optus has carried Odyssey since the channel’s inception in July 1997, but its contract comes to an end in 2004, and attempts at renewal have so far failed. Odyssey says efforts to negotiate carriage on Foxtel have also been rebuffed since they began in March.
The timing is bad for Odyssey’s negotiations. For the past seven months, Optus and Foxtel (25%-owned by The News Corporation) have been busy massaging a proposal to enter a content supply agreement. The arrangement would give Optus the right to carry all of Foxtel’s channels, excluding interactive pay-TV services, free-to-air retransmissions and video-on-demand, beginning November 1. Should Optus digitize its network, it will be obligated to offer all the Foxtel channels; currently they offer competing programs. Among Foxtel’s offerings are Discovery Channel and National Geographic – Odyssey’s doc competition.
The arrangement between Optus and Foxtel is meant to help cut costs – at the end of the last fiscal year, Foxtel announced losses of AUS$100 million (US$54.7 million). But Odyssey, along with other media operators including Seven Network and Ten Network Holdings, is concerned the proposal reduces competition in the market to a dangerous degree. Says Henri de Gorter, general manager of Odyssey, ‘They will become a booking agent, deciding which channels go where and when. Australia is a small market for such an expensive product, so I sympathize – there has to be some rationalization of the market. But, in a market that says there has to be competition, we have the right to compete.’
Foxtel issued the following statements in response to Odyssey’s claims: ‘Foxtel has met twice with representatives of Odyssey in recent months (April and July). Foxtel has never received a channel carriage proposal from Odyssey. Foxtel has no equity interests in, nor control over, Discovery Channel or the National Geographic Channel.’
The Australian Competition and Consumer Commission, which has also expressed concern over the agreement, is currently reviewing the arrangement and is expected to announce its ruling later this month.