New West Showdown as Dodgers Dawn

When Fox Sports West 2 was launched in January, only a few Southern California cable companies--and no major ones--offered the new regional sports network.

The conjecture, though, was that other companies would come around before the start of the baseball season because of Fox Sports West 2’s 40-game Dodger package that begins with today’s season opener.

But cable operators, as a group, are resisting Fox Sports West and its parent company, Fox Sports Net. There have been no significant cable deals regarding Fox Sports West 2 since the spinoff channel was launched Jan. 27.

Fox Sports has since lowered its asking price for Fox Sports West 2 from 75 cents a subscriber per month to 60-65 cents. There has still been resistance, even though Fox believes the price is fair. Fox also believes cable operators will eventually give in, or risk losing subscribers.

That could be the case, since DirecTV began carrying Fox Sports West 2 last Friday. Viewers can choose that option and get the Dodgers’ first basic cable package--35 homes games, five road games--plus the Clippers, Mighty Ducks, daily horse racing, high school sports and all the other programming on Fox Sports West 2.

What’s more, Fox Sports West began a heavily advertised promotion with DirecTV on March 21 that allows consumers to buy a digital satellite system (DSS) for as little as $49.95, counting a $200 rebate from DirecTV and an instant $50 discount from Fox. In most cases, however, consumers need more than one receiver, which adds to the cost.

After buying a DSS system with one, two or more receivers, there is a monthly fee of $29.95 for DirecTV’s basic service, which includes Fox Sports West 2. It’s one of more than a dozen new channels DirecTV added to its basic package Friday. Another is Chicago superstation WGN.

Most consumers have chosen to add premium packages to DirecTV’s basic service, and that’s where the monthly cost can get expensive. An average DirecTV subscriber pays $65-$80 a month.

Most cable operators say they aren’t overly concerned about the Fox-DirecTV promotion.

“We’ve had virtually no response to it,” said David Auger, general manager of Time-Warner cable in the San Fernando Valley.

Others say it has done more harm than good and has set back negotiations. One operator complained about the anti-cable tone in the newspaper ads, calling the wording “out of line.” Another said Fox was “cutting off its nose to spite its face” and was making a mistake by trying to force operators to pay for a channel they never asked for.

The cable industry considers DSS little more than a thorn in its side. There are more than 60 million cable households in the United States, and DirecTV, the major player in the fledgling DSS industry, is in only about 2 1/2 million.

However, DirecTV has been cutting into cable’s business ever since the first DSS unit was sold in Jackson, Miss., on June 17, 1994.

“Two-thirds of our new subscribers coming on now are from cable territories,” said Eddy Hartenstein, the president of DirecTV.

About DirecTV’s deal to carry Fox Sports West 2, Hartenstein said, “We just felt it is important to give our subscribers a complete package, and without Fox Sports West 2, we wouldn’t be providing a complete package.”

Even with the DirecTV deal, Fox still has to win over cable operators.

“Some deals are imminent,” said Kitty Cohen, the general manager of Fox Sports West.

Bill Rosendahl, senior vice president of public affairs for Century Communications, said, “We were all bludgeoned with this gun-to-the-head strategy when we were first hit with this a couple of months ago, and as an industry we’re all concerned with the bottom line and trying to keep spiraling programming costs down.

“But all of that said, I believe reasonable people, in dealing with something as important as one’s sporting interests, can get through all of that. I’m optimistic that eventually something good will come out of all of this.”

A key person in trying to make headway with the cable operators is Tim Krass, vice president of affiliate relations for Fox Sports West. He has been dealing with cable operators in that capacity since Prime Ticket, the forerunner of Fox Sports West, was launched in 1985.

“Negotiations are going pretty well,” Krass said. “We’ve come up with some creative things to offer the operators.”

One offer allows any company that agrees to take West 2 free service through this year. Originally, the nonpayment period extended only through the baseball season.

Another offer allows any cable company with Fox Sports West 2 to show Mighty Duck and/or Clipper playoff games for as long as either team remains alive, without charge.

Leo Brennan, general manager of Cox Communications, which has 210,000 subscribers in Orange County, scoffs at that offer.

“It’s pretty common in the cable business for a new network to offer a free preview,” he said. “The problem is, if we start showing West 2, it’s hard to then take it off. You can’t lead your subscribers to believe they’re going to get a particular channel, and then take it away.”

Said Brennan: “If they sincerely want to give those games the most possible exposure, then why don’t they put them on Fox Sports West? It would only be for a couple of weeks.”

Brennan said he asked if the offer meant that he could show only the Duck telecasts on an available channel, but he was told no.

Brennan and other cable operators say they will continue to negotiate with Fox, but the big hang-up is the price of 60-65 cents.

Cohen said that when Prime Ticket was launched 12 years ago, the price was 75 cents. And Prime Ticket’s inventory at that time included the Lakers, Kings, Forum boxing and not much else.

Steve Webster, director of media relations for Fox Sports West, produced a list of Prime Ticket’s inventory in 1985 and Fox Sports West 2’s current inventory. The West 2 list, which includes USC and UCLA football beginning this fall, is about 10 times as long.

Said Tony Ball, chief operating officer of Fox/Liberty Networks, parent company of Fox Sports Net: “This is a stand-alone channel, not just an over-spill channel.”

Peter Liguori, vice president of marketing for Fox Sports Net, said, “Fox Sports West 2 provides cable companies with a means for attracting new subscribers and advertisers. And consider what they can charge for advertising during a Dodger telecast as opposed to something else.”

Cable operators are allowed two minutes an hour for local advertising. “That figures out to 12 30-second spots during a three-hour telecast,” Cohen said.

Said Liguori: “So the cable operators complain about the 70 cents, or whatever it is, but considering what they can make off additional advertising revenue, it’s more like 20 cents.

“Besides, all of our surveys indicate that the viewers would be more than willing to absorb that 70-cent cost.”

The cable operators say, sure, their subscribers who want Fox Sports West 2 will be willing to pay, but what about those who don’t want it?

“We’ve got to look out for our subscribers over the long haul,” Cox’s Brennan said.

Fox at least has made a gesture to appease fans who want to see the Dodgers’ season opener against Philadelphia but don’t have a ticket. Fox has set up jumbo screens and bleachers at five Southland locations where the Fox Sports West 2 telecast will be shown.

Those locations: Century City Entertainment Center, City Corp. Plaza downtown, the Warner Center in Woodland Hills, Planet Hollywood at South Coast Plaza and the Ontario Mills shopping center.

“We’re making the attempt to be fan friendly,” Cohen said.

But it seems no matter what Fox Sports West and Fox Sports Net do--and that includes filing an antitrust suit against Disney for its alleged role in influencing cable operators--nobody flinches.

This dispute, which has viewers caught in the middle, appears to be one that isn’t going to go away any time soon.