TV SportsBaseball TV deal contestedMLB is trying to move Extra Innings package exclusively to DirecTV, but there's resistance.
By Larry Stewart Los Angeles Times
Staff Writer February 3, 2007 (Times staff writer Jim Puzzanghera contributed to this report from Washington.)
Red Sox Nation has spoken. A pending deal by Major League Baseball to put its Extra Innings pay package exclusively on DirecTV may have to be put on hold now, buffeted by an uprising involving baseball's most ardent fans, spearheaded by those who live and die with the Boston Red Sox.
MLB expected to announce the deal as early as next week, but that was less certain after Sen. John F. Kerry (D-Mass.) on Thursday asked the Federal Communications Commission to investigate the matter.
For five seasons, MLB's Extra Innings has offered up to 60 regular-season, out-of-market games a week on cable, through the In Demand service, as well as DirecTV and Dish Network.
Under terms of the new deal, DirecTV reportedly would pay $100 million a year over seven years for the rights to the package. In Demand reportedly had offered $70 million a year to retain Extra Innings.
The crux of the deal apparently centered on MLB's plans to launch its own channel in 2009, similar to NFL Network and NBA TV. According to a source familiar with the negotiations, MLB unsuccessfully used Extra Innings as a negotiating wedge to get cable to put the new channel on a basic tier rather than a pay tier so it could get the widest exposure possible.
Cable companies, including Time Warner in L.A., often seek to place such niche offerings on a pay sports tier so that only the customers who want them have to pay for them. Last year, a similar carriage dispute took NFL Network off Time Warner.
Sports television consultant Neal Pilson said Friday it is his understanding that, indeed, the baseball channel "was a component" in the negotiations. But, he added, "Baseball is almost religious in its financial analysis before making any deal and you can be sure there has been a lot of deliberation and a lot of research that has gone into this."
That didn't matter to fans, who have been voicing their displeasure since news of the pending deal broke two weeks ago.
Michael Abramowicz, 34, of Arlington, Va., is a law professor at George Washington University who gets Extra Innings on cable. He talked about the pending deal in a blog last week. "My reaction to this has been genuine sadness," he wrote. "Watching baseball games is my No. 1 hobby, and my house can't get DirecTV because of nearby trees. It did occur to me that if I chopped down my neighbors' trees, I would probably do a year in jail, which would leave me six years to enjoy the games."
Reached by phone Friday, Abramowicz said he would switch to DirecTV to keep Extra Innings if he could.
Ryan Hecht, 34, of Queens, a Time Warner Cable subscriber and a die-hard Dodgers fan, is in the same situation as Abramowicz. Reached by phone Friday, he said, "I'd switch to DirecTV if I could, but my landlord will not let me install a satellite dish."
The issue gained national attention when Kerry on Wednesday said he would question FCC Chairman Kevin J. Martin at a previously scheduled Senate Commerce committee hearing the next day.
Kerry left the hearing early, though, and instead faxed a letter to Martin, citing concerns about the deal and contending that Extra Innings has been available to 75 million subscribers but would be available to only 15 million if DirecTV has it alone.
Of the 500,000 subscribers to the Extra Innings package last season, 270,000 were with DirecTV, according to sources. Going by those numbers, 230,000 would be left out this season.
DirecTV has a disproportionate number of Extra Innings subscribers because it caters to sports fans. NFL Sunday Ticket, by far the most popular pay sports package, has always belonged to DirecTV exclusively, and the rights fee is now a whopping $700 million a year. That package's exclusivity never caused much of an uproar among fans because it was never available on cable.
Kerry, in his letter, said, "In the case of my hometown team, Red Sox Nation stretches all across our country from coast to coast. I am concerned that this deal will separate fans from their favorite teams."
Kerry could not be reached by phone Friday, but Vince Morris, a spokesman, said the senator is taking up the fight not only because he is a Red Sox fan but because people had been approaching him, seeking answers.
"He wants to find out more facts and find out what the FCC can do," Morris said.
An FCC spokesman would not comment on Kerry's letter. The agency has some authority over cable and satellite television but generally stays out of programming issues that don't involve local content.
The FCC has allowed NFL Sunday Ticket to be offered exclusively on DirecTV since 1994. However, News Corp. has filed a request for permission from the FCC to transfer its controlling 38.5% stake in DirecTV to Liberty Media Corp in a swap of assets, and any complaints about baseball's Extra Innings deal could come up in that review.
Those involved in the deal declined to comment, but baseball executives have privately suggested that fans with cable can subscribe to the broadband package, which cost $79 last season, $100 less than what Extra Innings cost.
But Hecht, for one, isn't buying it, saying, "There is no substitute to kicking back on a couch and watching a game on a TV screen."http://www.calendarlive.com/tv/cl-sp...?coll=cl-tvent