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New Zealand journalists would have had to agree not to criticise Sky TV commentators, under Olympic Games rules the pay-TV company wanted to impose on its news media rivals.

Sky backed off that demand after protests from its competitors, but never backed down to the point where its demands complied with New Zealand copyright law.

GETTY IMAGES New Zealand Olympic Committee boss Kereyn Smith.

On Thursday, Fairfax and NZME ended several months of negotiations, telling the New Zealand Olympic Committee (NZOC) it could not accept the news access rules (NARS) and would not send teams - nine staff in the Fairfax case - to the Games, which start on August 6.

Sky was able to flex its muscles, as the NZOC had allocated it the New Zealand broadcasting rights, and helped it write the rules that resulted in the standoff.

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DAVID WHITE/FAIRFAX NZ Fairfax group executive editor Sinead Boucher.

​Staff would not be accredited for Rio unless signed up to Sky's conditions. Accreditation gives reporters and photo journalists access to athletes, venues, accommodation and even a passport visa to enter Brazil.

Had Fairfax accepted the rules and attended, its reporters were left wide open to having their coverage rights removed, if deemed in breach of the NARS.

Fairfax group executive editor Sinead Boucher said the clause about commentator criticism showed Sky was not just trying to protect its rights, but to control the media message in a much broader way.

​Fairfax Media owns Stuff, nine daily newspapers including The Press and The Dominion Post, and two Sunday newspapers including the Sunday Star-Times.

NZME, which owns the New Zealand Herald, also failed to reach an agreement with Sky over use of Games footage on its news website. It joined Fairfax in pulling its reporters out.

Both organisations will still cover the Games.

Having rubber-stamped the rules, the NZOC left competing media companies to resolve the issue among themselves, with Sky showing little motivation to do so, Boucher said.

In a letter to NZOC boss Kereyn Smith, Boucher expressed disappointment in the process.

"In our view, it is unacceptable that a broadcast rights holder should have been given so much power to control how its competitor media organisations get to report on an event of such national and international significance.

"I would also like to express my deep disappointment that the NZOC has effectively washed its hands of any part in this, despite being a joint party to the NARS, but has instead given full responsibility for deciding the terms of accreditation to Sky."

NZOC's charter sets out an expectation that Olympics coverage is made available to the fullest extent, to the widest audience possible. Fairfax reaches 80 per cent of the population. Sky forecast it would have 830,000 subscribers as at June 30.

Boucher pointed out that New Zealand athletes were supported by a great deal of public investment from local community fundraising right through to government elite funding.

Initially, Mediaworks, TVNZ, NZME and Fairfax all fought the restrictions. Each has made their own decisions.

Sky spokeswoman Kirsty Way was unmoved.

"Sky stands by its news access rules that they're the most generous in the whole world and have been acceptable worldwide, but apparently they're not acceptable to our news agencies in New Zealand," she said.

In fact, the United Kingdom's NARS include a carve-out for local copyright laws. Similar provisions were sought in New Zealand, but refused by Sky.

The New Zealand Media Freedom Committee said it was "extremely disappointed" with the NZOC, which had curtailed the right to freedom of expression.

"The terms proposed would have forced media companies to sign away rights they have under New Zealand law. This is not acceptable," chairwoman Joanna Norris said.

"The loser in this situation is the New Zealand public who rightly expect broad and free media coverage of important international sporting events such as the Olympics."

