Sky Television wants to split into two its legal action against New Zealand's major news organisations for an alleged breach of copyright law.
The allegations stem from the use of up to 4000 rugby, Olympic Games, and other sports highlight videos by TVNZ, Fairfax, Mediaworks and NZME.
The case could set a precedent for how New Zealanders access their online sports news.
Sky hopes to split a trial as it seeks damages from claims of a loss of subscribers and advertising, as it identifies which clips it alleges have breached its copyright.
Sky's counsel Julian Miles, QC, said at the High Court in Auckland this afternoon that it would take about six months, at great cost, to analyse each clip individually.
He argued the court should use a collection of clips which represent the alleged offending.
However, lawyers representing the four major media companies suggested each clip needed to be analysed individually to identify which specific videos may have been in breach.
Miles submitted that the "real issue here is the determination of liability", and later added any damages as a result of the alleged offending will continue into the future.
"I accept that it is an ongoing issue, it's an industry issue ... but the alternative is too horrific."
He said it would be "irresponsible" of Sky if it did not address the issue of alleged copyright infringement.
"TVNZ clearly has a policy of running two or three clips per [rugby] game," he told the court.
Sky and the media companies disagreed over whether the videos should be classed as news or entertainment.
"I hold that these were not information [in a news sense] but entertainment," Miles said.
Justice Paul Health said a Rugby World Cup final could be viewed differently by different parties.
He said it may be argued it was news who won the game, but the game itself could be classed as entertainment.
Miles said today's younger audience wanted a "quick clip", rather than to watch the whole match.
"They do want to see how Grant Elliott hooked that ball like he did," he said, and argued the media companies needed to agree to pay for videos it used online rather than rely on legislation covering fair dealing.
The case follows the unsuccessful injunction against Fairfax for the use of Olympic footage, and a failed Press Council complaint on the reporting of video from the Rio Games last year.
NZME publishes the Herald and nzherald.co.nz.