Truth can be much stranger than fiction in business and sport. A privately run sports competition attempts to sue its major sponsor for not paying the money they are owed under the terms of the sponsorship agreement. The same competition sides with the sponsor in suing a news organisation for infringing copyright of game footage. The news organisation is also the half-owner of the competition. Finally, after a great deal of legal and public sabre-rattling, an uneasy truce is declared among all parties.
You may think that this scenario makes little sense or even defies belief. Yet it is exactly what has been occurring in Sydney between the National Rugby League, its major sponsor, Telstra, and Premier Media Group (a partnership between News Ltd and PBL), the owners of the sports news website and pay television operation Fox Sports.
Moving away from the arcane business relationships that tend to dominate rugby league, this battle is symptomatic of a wider set of challenges facing sports and media organisations on the new frontier of sports coverage globally - the Internet.
The stakes here are incredibly high. Media and sports organisations are involved in an intense struggle for strategic market position, attempting both to maintain existing revenue streams and to open additional, potentially profitable online channels to deliver content to sports fans.
Telstra, for example, has spent $170 million over the past year to secure rights packages that include Internet and mobile phone coverage rights to key sports such as the AFL, NRL and V8 Supercars.
Yet these figures are small change when considering the escalating value of the online media market. One estimate suggests that Internet protocol television (IPTV) will eventually be worth $20 billion worldwide, a value that is supported by the determination of Google, Yahoo! and Joost to deliver television programs via the Internet.
The disruptive impact of the Internet in the sports media market is now becoming obvious. Greater broadband penetration and a rapidly growing consumer appetite for on-demand highlights, replays and information - stimulated, of course, by media groups and telecoms - have provided additional and welcome opportunities to sell sport to customers.
But this welcome has occasionally proven deceptive for some sports organisations, giving rise to unresolved disagreements over who owns what footage, when they can show it, for how long, and on what website.
Web-based audio and video streaming technologies hold out the potential to destroy the cosy relationship between sports administrators and television networks that has prevailed for the past 25 years. Rivers of gold have flowed from the exclusivity guaranteed by television and radio broadcast rights for cricket, Australian Rules football and the rugby codes, reliably attracting millions of viewers and millions of advertising dollars.
But it is almost impossible to maintain rights exclusivity online. Digital footage of sports events is able to be copied, shared between thousands of users here and overseas, and watched via multiple sites, including official competition sites (afl.com.au or nrl.com), news media sites (news.com.au or theage.com.au), and comparatively anarchic user-generated video-sharing sites like YouTube and vSocial. A quick search of YouTube produces clips of the AFL, cricket, the National Basketball League and many other domestic and international sports.
This new reality was underscored by last season's A-League Football Grand Final between Melbourne Victory and Adelaide United. Much to the chagrin of Football Federation Australia and Fox Sports, the exclusive television rights holder, a US-based streaming site, channelsurfing.net, offered a "pirate" Web transmission of the match. Knowledge of the webcast was circulating in popular online forums and bulletin boards at least five days before kick-off. Legal efforts by the FFA and Fox Sports to prevent the webcast proved futile.
It is also plausible that football fans were not doing anything ethically wrong here. The Internet is a technology predicated on the free flow of information and ideas, a notion championed by advocates of free speech, bloggers, independent journalists and political activists. Media companies and sports organisations all over the world have since jumped on this bandwagon, eyeing the endless possibilities for delivering "24-7" on-demand replays, highlights and information services to consumers for a fee.
What they are discovering is that this free flow of information cuts both ways, destabilising the value of existing coverage rights contracts and causing additional and unexpected costs in terms of legal advice and action. Global online media and the courts now mark the new frontiers of sport spectatorship.