While providers play hardball, Lakers fans are missing basketball
Although the winless Lakers are hardly must-see television at the moment, that is of little solace to the millions of DirecTV and Cox subscribers who are unable to watch the team’s games on their new cable home, SportsNet, which is owned by Time Warner Cable.
Time Warner Cable hoped to have all of its distribution agreements for SportsNet and its Spanish-language companion channel, Deportes, locked up by now. Deals with Charter and Verizon Fios were finished before the first Lakers regular-season game appeared on the two channels Wednesday, but both Cox and DirecTV are playing hardball.
Cox and DirecTV have almost 3 million subscribers in Southern California, many of whom have taken to social networking to criticize the two pay-TV companies for not getting a Lakers deal done.
Given how much DirecTV counts on sports as a selling point to subscribers, the satellite broadcaster’s slowness to embrace SportsNet has puzzled some.
One reason DirecTV and Cox are reluctant to sign on for SportsNet and Deportes, at least at the price Time Warner Cable wants (up to $3.95 per subscriber, per month) is that they also face a big fee increase with the Dodgers down the road.
Currently the Dodgers get about $40 million a season in TV rights fees from Prime Ticket, which is owned by News Corp.’s Fox Sports. That pact expires after next season. Guggenheim Partners paid $2.15 billion for the Dodgers in part because it was their belief that they can make much of that back in television rights. When Frank McCourt still owned the Dodgers, Fox sought a renewal of the rights for $3 billion over 20 years, which averages out to $150 million per season; that was ultimately rejected by Major League Baseball.
Fox is trying to negotiate an agreement with Guggenheim Partners to keep the team on Prime Ticket. Time Warner Cable also wants the Dodgers for SportsNet. A bidding war could drive the price beyond the $3 billion Fox offered to McCourt, and whatever network gets the team will seek a big increase in license fees for the channel from pay-TV distributors.
Much of those costs eventually are passed down to the consumer in the form of bigger cable bills.
Time Warner Cable, Cox and DirecTV all declined to talk specifics about Lakers negotiations but insist discussions are continuing.
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