TWC: Distributors Unwilling to Discuss Dodgers Network

MSO Dismisses Article Suggesting Contract Writedown
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To paraphrase Yogi Berra, it seems to be getting late early out there for Los Angeles Dodgers fans who are not subscribers to Time Warner Cable.

With 12 days to go before the club’s 2015 opener against the San Diego Padres, the MSO, which is handling the distribution for and operating SportsNet LA, the regional sports network home to the Dodgers, said negotiations have stalled.

“We want all Dodger fans to have access to SportsNet LA. Despite our repeated attempts, other providers are unwilling to engage in any discussions,” said the MSO. “If Dodger fans want to enjoy SportsNet LA this season, we encourage them to switch to a provider that carries the network.”

In addition to Time Warner Cable, Bright House Networks, which benefits from the nation’s No. 2 MSO’s programming leverage and negotiations, and Champion Broadband are the only other distributors in SportNet LA’s TV territory to ink affiliate pacts.

Last season, DirecTV, Dish Network, Charter Communications, AT&T U-Verse and Cox Communications all balked at a monthly license fee that exceeded $4 per subscriber.  The same shuttout scenario evidently could unfold, particularly with the price to play this season increasing to a reported $4.90 per subscriber.

Time Warner Cable, meanwhile, is left footing a very expensive bill. The MSO is now in the second of a 25-year deal under which it is paying Guggenheim Partners, the Dodgers owners, some $8.35 billion over its term. Aiming for a long-term cost-certainty hedge against the rising cost of sports rights, Time Warner Cable assumed the full risk, assuming it would offset those outlays by collecting the license fees from other distribution players in the Dodgers TV territory.

The absence of contractual movement prompted the New York Post to pen a story on March 23, indicating that Time Warner Cable was preparing to take a $1 billion writedown on the value of the impaired asset.

The MSO yesterday afternoon brush-backed the story thusly:  “In response to a March 23rd New York Post article about SportsNet LA, Time Warner Cable has no plans to take a write down in connection with its Dodgers contract. In fact, TWC does not carry an asset on its balance sheet related to the Dodgers and, therefore, there is no asset for it to write down now or in the future. We continue to believe in the long term value of the network and remain eager to make it available to all Dodgers’ fans."

Price considerations aside, some market watchers believe the pending approvals or disapprovals of the proposed Comcast-Time Warner Cable and DirecTV-AT&T mergers are also serving to hold up negotiations for the Dodgers RSN.

With conversations currently struck out, it appears that 70% of television households in the L.A. region won’t be able to watch SportsNet LA’s coverage of opening day and again face the prospect of another entire season without the Dodgers -- one of the favorites to reach the World Series -- on local television.

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