YES Down a Run, Still Pitching

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The Yankees Entertainment & Sports Network last week ratcheted up its public battle with Cablevision Systems Corp. during a contentious hearing called by local politicians here.

But with nearly three-fourths of the Major League Baseball season already completed, the network finds itself playing from behind in the late innings of a game it thought it had won before the first pitch.

The MSO has remain steadfast in its desire to offer YES as a premium service to its 3 million subscribers, rather than pay $2 per subscriber to offer 130 exclusive New York Yankees games and other ancillary sports programming on its basic tier.

No new negotiations are scheduled in the near term, although YES president Leo Hindery disclosed last week that Cablevision recently rejected "an extraordinary compromise" to settle the feud, although he would not reveal specific details.

Also, Hindery said an offer to meet with an impartial mediator was also shot down by the MSO.

The network also has been unable to debate Cablevision on the public stage. The MSO failed to participate in public hearings called last week by Bronx Borough President Adolfo Carrion to help facilitate an agreement between the two parties.

POL'S DISAPPOINTED

"This is very disturbing … We're more than half way through the season and we still don't have the New York Yankees" on Cablevision, Carrion said.

"These two giants of the industry have to come to the table and act like grownups. Unfortunately, Cablevision chose not to come and I'm very, very disappointed."

Cablevision did release a statement saying it "shares" Carrion's frustration concerning the impasse.

The MSO declined to appear because of concerns that such a public discussion "would be far more likely to drive the parties further apart than to bring them together," and would be ill-advised, given YES's antitrust lawsuit against Cablevision.

Hindery was in attendance and restated his claims that Cablevision is deliberately boycotting the expensive basic service to protect its owned-and-operated regional sports networks, Madison Square Garden Network and Fox Sports Net New York.

"Cablevision's sports network, MSG, used to have the rights to televise Yankees games," Hindery said. "This year, YES has those rights … and ever since, Cablevision has been taking its competitive frustrations out on YES — and the real losers have been Cablevision's cable customers and the Yankees fans."

AD LOSSES

YES has also suffered financial losses because of the dispute, particularly on the advertising side. The network has been forced to drastically cut its advertising rates to reflect the void of nearly half the market's 8 million overall subscribers, recently appointed YES senior vice president of general sales manager and media sales Lisa Coghlan said.

Coghlan, who replaced cable veteran Jerry Machovina — who left YES to seek opportunities outside of the advertising and media fields — said the network's ad inventory is "well-sold," but would not reveal specific figures.

While the network counts auto dealer Nissan, financial company Dunn and Bradstreet, and beer distributors Budweiser and Coors as advertisers, Coghlan admits YES has had difficulty attracting retail companies without full marketplace distribution.

"It's more of a challenge for retail accounts because they want to gain maximum reach, but for other accounts it hasn't been that difficult because we've repriced our numbers based on our delivery," she said. "Obviously, we went out with higher estimates originally, but now we're priced fairly on what we do have."

Nevertheless, the network is also touting its viewership performance to help draw new clients. Though it's in 33 percent fewer homes than MSGN, Coghlan believes the network will end up averaging around a 2.4 rating for Yankees games, 25 percent below MSGN's 3.0 average rating for Yankees games in 2001.

"Given our distribution, we figured we'd end up around a 2 rating, so we're over-delivering what you would expect, given our distribution," she said.

PITCHING FOR FALL

YES is also beginning talk to advertisers about its fall programming lineup, which will most likely include games involving the New Jersey Nets, last year's National Basketball Association Eastern Conference champions. Fox Sports Net New York, which held the Nets basketball rights, was unable to reach an deal extension during its exclusive negotiating period with the team, which ended June 30, according to FSN executives.

A YES spokesman said the network is currently negotiating with the team. A deal is virtually assured, though, since both entities are owned by the YankeeNets LLC holding group.

Unlike Madison Square Garden's New York Yankees agreement, Fox Sports Net's contract with the team does not feature a right of first refusal clause that allows the network to match any outside Nets offer.

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