Regional broadcaster WIN Network has lost its bid for an interim court injunction to stop Nine Entertainment Co live streaming content into its broadcast area.
Justice David Hammerschlag today rejected WIN’s request for an interlocutory injunction on 9Now following a day arguments, during which WIN took aim at Nine for refusing to block users from live streaming based on their postcodes.
The NSW Supreme Court heard today how the action had been launched after Nine refused a request by WIN CEO Andrew Lancaster to have streaming revenues included in their affiliate broadcast deal.
WIN’s barrister Tony Bannon SC told the court how despite collecting postcode data from people signing up for the service Nine “don’t even offer to not live stream to people who identify as being in the Illawarra area or within the WIN licence area”.
In making his deliberations Justice Hammerschlag questioned WIN on the practically of its suggestion that postcodes be geoblocked, with Bannon responding: “It is not true that their only option is to shutdown the service (should the injunction be granted.)”
WIN is claiming Nine, whioch provides most of its programming under an affiliate agreement, is breaching the terms of that deal by live streaming its content directly into WIN’s broadcast areas, and selling advertising on it.
It launched the court action last month, although many believe it is a negotiation tool as the network’s jockey ahead of a renewal of an interim affiliate agreement signed at the 12th hour on New Year’sEve, with some media executives describing the action as WIN’s attempt to build “the great geoblock of Wollongong”.
In his ruling this afternoon Justice Hammerschlag said while he believed both parties had compelling arguments, on balance he was not persuaded that he should shut down 9Now on a temporary basis.
“I am unpersuaded that interlocutory relief be granted”, said Justice Hammerschlag noting that the consequence of shutting down the service, before the final trial, would be more severe to Nine than those to WIN.
The decision came after WIN told the court that the launch of 9Now meant that their TV network had become a “wasting asset” and that the provision of live streaming meant their exclusive broadcast rights could be circumvented with advertising revenue lost to Nine.
“We have sold advertising to advertisers in our area… we are entitled to restrain them as we have sold advertising on the basis that we have the Channel Nine eyeballs on the WIN station,” said Bannon.
The court heard today that Nine did not believe it technically possible to bar users within the WIN licence zones and were the court to grant the injunction it would force Nine to shutdown 9Now nationally.
Nine’s barrister Noel Huntley SC also told the court that WIN had been aware of the move to live streaming since November and that it had only launched legal action after the metro TV station refused to share digital revenues from 9Now with its affiliate.
“We submit that the case will be found to be entirely without merit,” said Huntley.
“Our position is that there is no evidence of damage (to WIN). There is not evidence that they will be hurt beyond at a helicopter view.”
Huntley also noted that Nine did not believe their was a way to stop live streaming into WIN’s licence areas without shutting down the 9Now service nationally, with an affidavit from Nine digital boss Alex Parsons, tendered to the court, describing any injunction as representing a “public relations disaster”.
The court today heard that WIN believes its affiliate deal with metro station Nine gives it the exclusive right to internet stream within its broadcast area, and this would be central to their argument when the case returns for three days on April 4. Nine is seeking costs in the interlocutory case.
“The ultimate issue in the final proceedings is a matter of contractual construction as to whether live streaming is broadcasting,” said Justice Hammerschlag.
In making his judgement Justice Hammerschlag also moved up the trial date in order to limit the potential payable damages should the court find in favour of WIN.
The court action comes on the same day that it emerged that WIN’s owner Bruce Gordon was the mystery party behind a purchase of a 3.4% stake in Nine. Gordon is already the largest shareholder in Nine with just under 15% of the shares, but purchased the latest parcel worth around $50m through a complex arrangement in which Deutsche Bank would hold them on his behalf.
Media watchdog the Australian Communications and Media Authority (ACMA) said it was “actively monitoring the situation” given Gordon already has 14.99% of Nine, which is the limit of what he is allowed to own under current media laws.