Fights Break Out Over Sports Nets

Author:
Updated:
Original:

As the last days of summer wind down, two big fights over carriage are just beginning to heat up in the sports world involving some of the largest cable operators and satellite companies in the U.S.

Comcast-owned Versus went dark on DirecTV when its contract expired Sept. 1, while Tennis Channel, presenting its inaugural coverage of the U.S. Open, remained stuck in the distribution net with the main outlet in the New York market, Cablevision Systems.

Versus president Jamie Davis said the disagreement with DirecTV was about a positioning downgrade. Before the plug was pulled on Sept. 1, Versus, which had resided on the Total Choice Xtra package, counted 14 million DirecTV subs among its 75.5 million base.

For its part, the nation's No. 1 satellite-TV provider said Versus was seeking a 20% price hike.

Davis, in an interview on Sept. 2, said: “Those increases aren't true. We're simply asking them to pay what the other providers are paying.” Davis, noting that Versus had received “tens of thousands of calls and e-mails” asking where viewers could get the network, said the talks broke down over DirecTV wanting to reduce Versus to an “undefined,” lesser tier of service.

“DirecTV wanted to take Versus away from 6 million subscribers who were receiving it for no additional cost. That was simply not acceptable for us. We hope to resolve things amicably, but that's a non-starter.”

DirecTV countered, saying that it offered to keep the channel up for a month at the current rate, which it says is “way above market.” The satellite operator said Versus refused, “forcing us to take it down.” Davis disputes that version of events.

DirecTV, in an e-mail response, wrote, “We've asked for packaging rights similar to other distributors like Dish … At this [point], the deal is terminated and we are treating this as a new network, from scratch.”

What they do agree upon: As of press time Friday, the parties were not negotiating.

Dish recently stepped into the fray by offering a three-month free trial to Versus.

On Friday, Versus began running ads in Texas and Wyoming newspapers, depicting sports gear under a trash heap with copy reading, “That's what DirecTV thinks of the sports you love.” Versus will Televise the Texas-Wyoming college football game Sept. 12.

The loss of carriage comes at an inopportune time for Versus, which said it is the fastest-growing sports network among viewers both in primetime and total day. Not only will it televise the aforementioned college football game, but it has upcoming Indy Car Series races, a WEC fight on Oct. 10, and the start of the National Hockey League season, coming off best postseason — from a viewership perspective — in a decade, Oct. 1.

The timing wasn't good for Tennis Channel either in its battle with Cablevision. Tennis has been seeking carriage beyond sports-tier positioning with the Bethpage, N.Y.-based operator. The network on Aug. 17 took ads in New York area newspapers, stating “Thanks for Nothing Cablevision” over an image of a tennis racket smashing a cable box. Cablevision dropped “the ball by preventing your subscribers from seeing Tennis Channel's round-the-clock coverage of the U.S. Open,” the ad said, while pointing consumers toward DirecTV, Dish and Verizon FiOS to gain access.

Long Island's largest newspaper, Cablevision-owned Newsday, did not run the ad. Cablevision, in a statement at the time, said: “The Tennis Channel ads are nasty, unfair and intentionally misleading, and we don't think anyone should carry them.”

Then on Aug. 26, Cablevision seemed to outmaneuver Tennis Channel: It had become a member of the National Cable Television Cooperative and was availing itself of the co-op's contract with Tennis, calling for sports-tier placement. Cablevision announced that it wanted Tennis to authorize its signal, so it could launch the service in both standard and HD formats on Aug. 28, three days before the 2009 Open was set to toss up its first serve. It also said it would make its iO Sports Pak, which houses 15 other sports networks and retails for $5.95 per month, available for free over the next month.

For its part, NCTC, which called the contract “enforceable and valid,” said it was unaware of any previous launch request where Tennis Channel delayed authorization for 30 days. (A decision could come on or before Sept. 25, when the 30-day notification period expires.)

Tennis CEO Ken Solomon, speaking to CNBC from Flushing Meadows before the tournament began and later that night on Fox Business Network, reiterated the network's position that it didn't have a deal and that it wanted to continue to negotiate.

Cablevision said it has a valid agreement. The Tennis Channel, it said, is claiming “a technicality allows it to delay the launch by a few weeks, and is refusing to do the right thing by authorizing Cablevision to receive its signal. ... Fortunately, Cablevision customers can already view more than 130 hours of the best live U.S. Open coverage on CBS and ESPN.”

Related