MSG: Time Warner Dispute Could Last Through NBA/NHL Seasons
Says No Meaningful Talks Since Jan.1
Mike Farrell -- Multichannel News, 2/8/2012 12:47:42 PM
Time Warner Cable, weeks-long carriage dispute with MSG Network could last through the 2011-2012 National Basketball Association and National Hockey League seasons, MSG Media president Mike Bair told analysts Wednesday, adding that no meaningful discussions have occurred between the parties since the network went dark on TWC systems in New York on Jan. 1.
MSG and Time Warner Cable have been locked in a stalemate primarily over rate increases, Bair said on a conference call with analysts to discuss MSG's fiscal second quarter results, adding that MSG is only seeking fair market value for its content.
"We do think that there will ultimately be a deal, but we can't predict when and we can't off any assurances that it will even happen during the 2011-2012 seasons," Bair said.
New York Rangers netminder Henrik LundqvistMSG carries New York Knicks NBA games, whose lockout-shortened season ends on April 26. The network also carries New Jersey Devils, Buffalo Sabres and New York Rangers NHL contests, whose seasons end on April 7. MSG owns the Knicks and Rangers teams.
He also disputed published reports that said MSG was asking for a 53% increase in rates and that Time Warner Cable was willing to pay a 6.5% hike, but did not offer any details.
"I can only tell you that those numbers are in some cases inaccurate and in some cases gross mischaracterizations of anything that is on the table that we've talked about," Bair said.
Other reports have said that MSG's insistence that carriage of its music channel Fuse be included in any deal. Bair said that assumption was false.
He added that the dispute is puzzling since Time Warner Cable obviously understands the value of regional sports networks since it agreed to pay handsomely for television rights to NBA Los Angeles Lakers games for two RSNs in southern California over 20 years.
"We know that Time Warner knows the profound importance of local sports programming," Bair said. "I think that is evidenced by their reported $5 billion investment in the Lakers on the West Coast. This is the No. 1 market in the country and we have extremely important products here that I don't think anyone can be without. I think they are at a real disadvantage by not providing them. But our job here, really is to maximize shareholder value over the long term and we think this is the appropriate way to do it at this time."
Time Warner Cable has claimed that MSG had originally asked for a 6.5% rate increase - which the MSO was willing to pay - but changed that demand to a 53% hike as the Dec. 31 deadline loomed. The MSO added that the network refused its request for an extension in December, which would have allowed cable customers to continue to see games on the channel.
"They are still demanding a 53% increase; our hope is that they will go back to their pre-December demands and close a reasonable deal," TWC spokeswoman Maureen Huff said in a statement.
While MSG said the carriage dustup has not had a big effect on the channel - Bair claimed that ratings for MSG were up in the calendar first quarter and that CPM prices for the channel are rising - that might change given TWC subscribers number about 30% of MSG's total viewers and 17.5% of Fuse watchers. "Time Warner is a significant distributor of ours and will have a material impact on oiur results for as long as this dispute continues," Bair said. He claimed that "many" TWC customers in the New York area have switched providers to like DirecTV, FiOS and RCN during the dispute.
Huff said that TWC's call volume has remained low and that any customer losses have been "insignificant."
MSG Media had a strong quarter - a 22.9% increase in adjusted operating cash flow offset a 1.2% decline in revenue. While overall revenue at Madison Square Garden declined 13.8% to $373 million and adjusted operating cash flow was down 11.7% to $550.6 million, most analysts were pleased with the performance, which they had expected to be worse in the wake of the NBA lockout.
Investors apparently felt the same way - MSG stock was up 1.7% (51 cents) to $30.28 per share in early trading Wednesday.
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Sign my petition demanding a credit on customer bills from Time Warner. They have now created a profit source for programming no longer offered. This is fraud and should be illegal. If they were forced to do this, maybe negotiations would get going. Class action lawyers, where are you.
Go to change.org and search for Time Warner: Put a $4.50 credit on our bills for MSG channels taken off cable systems.
Ruth Grunberg - 2/12/2012 6:26:49 PM EST -
Funny...MSG is owned by who???? And that who just happens to own cablevision.......F*CK YOU DOLAN!!!
Stv - 2/9/2012 10:46:48 PM EST -
come on now--i get excited to see games to be on channels away from MSG but all of a sudden it's blacked out because i don't have time to search what channel the games are on any such date...i had this service before they blocked it out so i'm pissed at Time Warner because the Rangers season started on time/ yet the Knicks season delayed by blackout ... now MSG is playing a game with viewers of Time Warner...where i live it's not hard to get to MSG but come on now tickets are hard to get ...is that one reason why east bergen county is being subject to punishment??? Sure i can switch over but other providers want an installation charge...what i dislike is according to the article--Negotiations are not happening since first of the Year and now 4 plus weeks later did both MSG and Time Warner quit on us...Aren't advertisers upset too???
Robert Spadavecchia - 2/9/2012 4:22:41 PM EST -
Unbelievable! Business is Business? Maybe, but bad business is bad business. We have a vote and power over whom we pick to pay for services as well as which channel we watch to increase advertising revenues. If you don't care enough to make a deal happen. Then eventually we will only watch MSG when all the other channels are blackout, otherwise we will honor them with our viewship. And TWC remember you are not the only subscriber in town, your price will have to beat the other subcribers, or else we are out! - Disappointed Dave
Dave DMan - 2/9/2012 12:39:13 PM EST -
I WANT TO WATCH THE KNICKS YOU IMBECILES
Sandy Kofax - 2/9/2012 11:39:09 AM EST
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