Nine streaming strategy vindicated as WIN TV loses appeal against former affiliate partner
Bruce Gordon’s WIN TV has failed in its appeal against Nine Entertainment Co live-streaming broadcasts into WIN regions, with the NSW Supreme Court awarding costs against the regional broadcaster.
WIN appealed the decision, originally delivered by Justice David Hammerschlag in April, who rejected its claims the streaming of Nine programming over the internet was in breach of its Program Supply Agreement as a part of its affiliate deal with Nine.
In what was dubbed “The Great Geo-Block of Wollongong” WIN had argued that the value of its agreement with Nine was being undermined by the ability of audiences to access content via another means and that streaming delivery was a form of broadcasting under the agreement.
It said that Nine should be blocked from streaming into regions where the pair had an affiliate agreement in a case that sought to define the meaning of broadcasting in the era of streaming.
In rejecting the appeal, Justices McColl, Sackville and Barrett agreed with the original judgement, highlighting that WIN had willingly entered into an extension of the affiliate agreement even after Nine had announced plans to live stream its programming.
“Much of WIN’s argument rested on the supposed commercial absurdity of WIN agreeing to a PSA that allowed Nine to exploit live-streaming to subscribers in the very areas for which WIN held a commercial television licence,” the judgement said.
“But, as the primary judge observed, there is nothing commercially irrational or absurd about construing the grant of exclusivity in cl 2.1 as limited to program content to be shown on free-to-air channels broadcasting in WIN’s licence areas.”
It went on to note: “The fact that WIN was prepared to agree to an extension of the PSA after it became aware that Nine proposed to commence live-streaming rather suggests that WIN took a sanguine view of the likely impact of the live-streaming on its advertising revenue during the five months between 27 January 2016 (when live-streaming commenced) and 30 June 2016 (the amended expiration date of the PSA).”
Further in the judgement the justices found that any “implied terms” of the agreement between WIN and Nine had not been breached by the streaming of shows, and that the definition of “broadcast” as contained in the agreement did not extend to streaming over the internet.
“There can be no doubt that the parties, being major operators in the relevant commercial field, entered into their contract with the knowledge that live-streaming was technically possible. But the subject matter of the contract had nothing to do with that technical possibility. The bargain was concerned with programs transmitted on Nine’s free-to-air channels in Nine’s licence areas.”
“Viewed in its context, the word ‘broadcast’ was correctly regarded by the primary judge as referring to broadcasting by free-to-air transmission; and that meaning applied both for the purpose of delineating the right granted to WIN and in determining the scope and content of the restriction accepted by Nine as a consequence of the exclusive quality of the licence it granted.”
You can read the full judgement of the NSW Supreme Court, Court of Appeal here.
