FREE-TO-AIR television networks should have their "first pick" rights to major sports events curtailed or abolished because of the unnecessary costs they impose on pay-TV operators and major sports.
A key economic adviser to government has recommended a rethink of the longstanding "anti-siphoning" rules aimed at maximising free TV coverage of major sports, ahead of Canberra's review of the scheme.
In a draft report out today, the Productivity Commission has slammed the list of sports offered first to free-to-air networks as "inherently anti-competitive".
"The anti-siphoning list appears to be unnecessary to meet the objectives of wide consumer access to sports broadcasts (it may actually reduce consumer access to sports broadcasts)," its latest annual review of regulatory burdens on business concludes. "Further, it imposes substantial regulatory burdens and competitive disadvantages on subscription television networks. The option to abolish the anti-siphoning regime should be explored."
The current regime covers key events such as the Olympics, Commonwealth Games and Melbourne Cup as well as cricket, tennis, basketball, soccer, golf, motorsport, AFL, rugby union and rugby league fixtures.
But it has come under fire from sports bodies, pay-TV operators and audiences because of the advantage it hands to the major networks and their hoarding of events they are not prepared to broadcast.
The major TV networks defend the system as a way of protecting people's rights to watch their favourite sports events for free. But even they are lobbying for change to some of the anti-siphoning provisions, which require them to air the listed sports on their main channel before they broadcast it on their second, digital channels.
The federal government has promised to review the rules this year.
In March, the Ten Network outraged South Australian football fans by deciding against showing the AFL's season-opening game live because it clashed with the high-rating The Biggest Loser. It was prohibited from airing the game live on its One network by the anti-siphoning rules.
The government has "use it or lose it" rules in place to try to force the big networks to broadcast the sports events they have preferential access to.
However, the Productivity Commission said their effect remained unclear and it backed a more formal trigger to delete from the list events not actually shown on free-to-air.
It has also called on Canberra to strip the "seemingly arbitrary" anti-siphoning list back to top events such as finals, as an interim measure, while the option of scrapping the system entirely is considered.