Charter Adds Fox Sports Carriage

By MONICA HOGAN -- Multichannel News, 3/26/2001

Sports fans in St. Louis can rest easier: They won't be losing baseball legend Mark McGwire from their local cable lineup.

St. Louis-based Charter Communications Inc., which is also its hometown's local operator, last week announced the renewal of a long-expired distribution deal with Fox Cable Networks Group for Fox Sports Net Midwest.

Charter last week also signed a deal with Turner Broadcasting System Inc. that should strengthen the MSO's sports programming lineup in other parts of the country.

In late January, Charter was in danger of dropping Fox Sports Net Midwest from its St. Louis system after contract talks with Fox broke down over license-fee hikes for the two regional networks.

Fox and Charter last week formally announced the renewal of regional sports networks Fox Sports Net Midwest and Fox Sports Net South. The deal was tied to new distribution agreements for Fox Sports World and a three-channel, out-of-market sports package called Fox Sports Digital Gold, which is set to launch this June.

"All of those discussions had been going on separately, and we ultimately wrapped it up into one fairly complicated deal," FCNG executive vice president of affiliate sales and marketing Lindsay Gardner said.

Charter spokesman Andy Morgan would not say whether the agreement announced last week includes fee hikes for the Fox Sports Net channels.

"We are pleased we came to an agreement and did not have to leave customers without a sports network," he said.

Charter also said last week it would increase distribution of regional network Turner South to systems in other Southern markets beyond Atlanta, where the MSO added the channel last year.

"Our commitment calls for us to have 1 million customers on Turner South by 2002," said Charter eastern division vice president of marketing and programming Tim Morrison.

The cable operator decided to expand carriage for Turner South after evaluating customer demand. The next round of subscribers will be added by April 1, in time for the start of the upcoming Major League Baseball season.

Morrison noted that sports programming drives much of the demand for Turner South.

"The level of interest in the Atlanta Braves throughout the Southeast is significant," he added.

But "there's very real appeal here beyond the Braves," Morrison noted, pointing to such non-sports programming Turner South fare as Bluebird Café and Southern Living Presents.

Charter plans to promote the channel addition through cross-channel, newspaper and radio ads.

Turner South will gain analog carriage on Charter's expanded basic package in selected markets in South Carolina, Alabama, Tennessee and Georgia. According to Turner, the deal will put the regional network's customer base at nearly 5.5 million homes.

Meanwhile, Charter is the first MSO to sign a carriage deal for Fox Sports Digital Gold, although the programmer is in serious talks with AT&T Broadband, Gardner said.

As the name implies, Fox Sports Digital Gold is most likely to be carried on digital cable rather than analog. Gardner said he expects some MSOs, including Charter, to create new digital sports tiers that would incorporate Fox Sports Digital Gold, Fox Sports World and other sports digi-nets.

Morgan could not confirm that Charter was planning any digital sports tiers, and added that carriage decisions for digital sports programming would be left to individual systems.

Gardner was encouraged that Charter would deploy the out-of-market package fairly quickly. "Charter is among the most aggressive cable companies in exploiting digital cable," he said.

Gardner added that the call for the Digital Gold package came from cable operators looking for a way to compete with the wealth of sports programming available from direct-broadcast satellite companies, especially DirecTV Inc.

"If you examine the product that cable operators can put on [digital] sports tiers, there's very little out there," Gardner said, adding that there's "almost an embarrassment of riches" with programming available for digital movie tiers.

Fox hopes to launch the Digital Gold package by June 1, but the programmer wants to launch with a critical mass of several hundred thousand homes, Gardner said.

Although Gardner would not divulge license fees for the package, he estimated that most operators would pay less than 50 cents per channel. The new sports package does not include ad avails for the operator. Local ad avails may be added later, once digital ad-insertion technology is developed, Gardner said.

Since most of the ads on the regional sports networks that feed into the new three-channel package come from local advertisers interested in local audiences, Fox is not expected to gain a premium for ads carried across the new Digital Gold package.

"We anticipate zero advertising revenue from this," Gardner said.