'Extra Innings’ Negotiations Play On
By R. Thomas Umstead -- Multichannel News, 4/1/2007 8:00:00 PM
Down to their last out, Major League Baseball and In Demand Friday were still trying to hammer out a last-minute deal to for cable to distribute the league’s “MLB Extra Innings” out-of-market game package.
The parties have been under pressure from Sen. John Kerry (D.-Mass) to close a deal. And individuals close to baseball and In Demand confirmed the parties met last Wednesday — one day after a contentious Congressional hearing on the impasse. But the same persons wouldn’t say whether the parties were any closer to cutting a deal or whether any other meetings were scheduled.
Baseball gave In Demand a March 31 deadline to effectively match DirecTV’s seven-year, $700 million deal to gain carriage of the package and the network’s upstart baseball channel.
The late talks came about after regulators last week questioned MLB and DirecTV about the deal — which would give the satellite service exclusive rights to the package.
During last Tuesday’s Senate Commerce Committee hearing, Kerry scolded MLB chief operating officer Bob DuPuy and DirecTV CEO Chase Carey, arguing that the league and Direc TV are more focused on making money than ensuring that America’s pastime is widely available.
“You’re driving for the best deal that you can get,” Kerry told DuPuy. “That may not be the best deal for baseball, frankly, or the fans.”
In order for cable to distribute the $179 package, Comcast, Time Warner Cable and other operators would have to agree to match Direc TV’s financial terms and offer MLB’s Baseball Channel on their most widely distributed tiers. DirecTV has agreed to launch the 24-hour channel to most of its 15 million subscribers.
Baseball rejected In Demand’s counter offer to match subscriber-for-subscriber DirecTV’s distribution of the Baseball Channel, set to debut in 2009, through its owners Time Warner, Comcast and Cox Communications.
“This was not about maximizing profits for us,” DuPuy told the commerce committee, insisting that what drove the league to cut the DirecTV deal was a guarantee that it would launch Baseball Channel to its entire subscriber base of more than 15 million customers.
Meanwhile, DirecTV last week began a national marketing campaign surrounding its Extra Innings package despite uncertainty over the package’s exclusivity. The satellite company ran a full page ad in USA Today touting the package as well as a 20% discount if purchased before April 7. It was unclear at press time what other national publications the ad was scheduled to run.
Steve Donohue contributed to this story.
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