Tata Sky blinks first in DTH war with ESPN-STAR Sports, restores sports channels in basic pack

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It may be recalled that starting June 1, 2008, Tata Sky had packaged popular sports channels ESPN, STAR Sports and STAR Cricket under a separate bouquet called Sports Platinum and unless subscribers agreed to pay a premium for this add-on pack they would miss out watching the French Open, UEFA EURO 2008, Asia Cup, Wimbledon, ICC Champions Trophy and Formula 1 on their television in the coming months.

However, the sports broadcasters cried themselves hoarse, challenging Tata Sky's new packaging policy and hauled it to the Delhi High Court.

Initially, Tata Sky vehemently defended its move, saying it gave "subscribers more flexibility" and threatened to take the "sternest possible action" against the sports broadcasters, but subsequently, it decided to smoke the peace pipe by agreeing to restore the sports channels in its basic pack.

In an alert sent to its subscribers on Saturday, June 7, Tata Sky said it was "voluntarily making available the Sports Platinum pack comprising ESPN, STAR Sports, STAR Cricket...FREE of cost, until 30th June 2008."

ESPN, which stood to lose considerable revenue and viewership (Tata Sky's 2 million-odd customers), was pleased with the outcome. "We are extremely delighted at this latest development. This will ensure that millions of sports fans will be able to enjoy quality sporting action, including UEFA Euro 2008 and the oncoming Asia Cup 2008. We hope that the signals now get restored as soon as possible," said R.C. Venkateish, managing director, ESPN India.

According to a source close to the development, the main dispute between ESPN and Tata Sky is over the pricing agreement.

Following the expiry of the contract between ESPN-STAR Sports and Tata Sky in March, the parties failed to agree on new terms of pricing.

While ESPN-STAR Sports claimed Tata Sky was asking for "unreasonable discounts," Tata Sky said ESPN-STAR Sports was not following the Telecom Regulatory Authority of India's (TRAI) suggestion that for DTH service providers, all pay channels should reduce their rates to 50 percent of the non-CAS cable rates (or Cable TV operators).

Thereafter Tata Sky approached the Telecom Dispute Settlement and Appellate Tribunal (TDSAT) and got an interim order of injunction against ESPN-STAR Sports, restraining the broadcasters from disconnecting their sports channels to Tata Sky.

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