SBD/13/Sports Industrialists

SCHANZER MAKES THE CASE FOR KEEPING THE BASEBALL NETWORK

     Ken Schanzer is the President and CEO of The Baseball
Network, the joint venture formed between MLB, ABC and NBC in
July 1993.  At The Baseball Network, Schanzer is responsible for
all of MLB's broadcasting activities.  Yesterday, he spoke with
THE SPORTS BUSINESS DAILY on the future of TBN and the challenges
facing them post-strike.  Excerpts follow:
     THE DAILY:  Given the uncertainty surrounding the sport and
the fact that the fate of The Baseball Network seems to be caught
up in that, what's your assessment of The Baseball Network's
future?
     SCHANZER:  I have spent no time thinking about the network's
future.  I have tried to spend all of my time trying to do
everything that we have to get done between now and the start of
the season in a way that's going to make it clear before they
have to make the decision on whether this is the best way to go.
The best thing that I can do about The Baseball Network's future
is make sure that it performs as well as it can.
     THE DAILY:  Have there been any discussions between you and
the owners on the goals that were set before last year necessary
to renew or any talk of extending the deal?
     SCHANZER:  I have had no discussions with the owners about
either of those things.
     THE DAILY:  Is there any time frame for a decision?
     SCHANZER:  My instinct is if they were to decide that they
wanted to go forward, the earlier they would make that decision
the better that would be for us.  It would make the sales
marketplace more attractive for us and give us an opportunity to
make deals for a longer duration.
     THE DAILY:  What would be your primary argument to the
owners against signing on with a Fox or a CBS?
     SCHANZER:  Without knowing what somebody else's offer is, I
can't say absolutely and definitively that this would be better
than any offer that they could get.  Although, my instinct is
that an entity or enterprise like baseball is better off owning
its primary marketing vehicle than putting it in somebody else's
hands.  And to the extent that it can maximize the value of that
vehicle via an ownership enterprise, that's a very wise way to
go.  That control is terrific.  It allows it to leverage all of
its assets in one place and derive the maximum value for it.
But, the one thing that something you own yourself cannot replace
is the willingness of an outside entrepreneur to absorb losses in
order to take on your vehicle.  But, it seems to me that
ultimately someone taking losses is not going to continue forever
as an inducement for them to keep paying you money.  Therefore --
 almost by definition -- it is a short-term strategy to go in and
out of the marketplace seeking to extract absolutely the maximum
dollar from a rights purchaser.  Because all you're going to do
in the end is revisit what happened when baseball sold its rights
to CBS for a dollar that bore no relation to its value.
     THE DAILY:  Would the season ending without a CBA be the
best hope for The Baseball Network, since another network might
be unwilling to step up without a deal?
     SCHANZER:  I have no knowledge of that.  My hope would be
that baseball, not just relating to network television but to a
whole slew of things, will begin to embrace a long-term strategy
of the way in which it ought to organize its affairs to maximize
the value of the sport both for now and for the future.  I would
hate for an immediate, transitory event to be the prevailing
reason why something were or were not done.
     THE DAILY:  How were you able to maintain your sponsors
through the strike?
     SCHANZER:  We've spent a lot of time servicing clients.
Making sure that they were happy.  Keeping them abreast of what
was going on.  I think we gave them a sense last year of the way
in which they were going to be treated.  I think if you talk to
sponsors they will say they had a very, very good feeling about
the way in which The Baseball Network worked with them throughout
last year and this year.  You hold onto partners by treating them
as partners.
     THE DAILY:  There was a comment this week by Bill Giles on
an all-baseball cable network.  Is that part of The Baseball
Network?
     SCHANZER:  No, not now.  That's long been a dream of Bill's
and he's taking a good, hard look at it.  If it got to the point
where it were real, I'm sure that he would probably want to take
advantage of some of the skills that repose in the people here.
It is really very much in the exploratory stage.  But I can't
think of anybody in baseball who's better equipped to make that
examination than Bill.
     THE DAILY:  Are there concerns that this year's All-Star
Game could be threatened by another walkout?
     SCAHNZER:  In my heart of hearts, my instinct is that so
many constituent elements of baseball were unhappy with being out
on strike for so long that I think there is an enormous positive
energy to try to get things resolved and not to disrupt this
season.  So that would surprise me.
     THE DAILY:  What's the latest on the World Series situation
between NBC and ABC?
     SCHANZER:  The people who are involved in it -- NBC, ABC and
us -- are very sanguine about its resolution.  I don't think
there is growing antipathy or any dispute rising.  It is the
ultimate non-issue. ... It will get resolved, and it will get
resolved simply -- and I suspect in the relatively near future,
because each of the networks has to make final decisions on its
scheduling for the fall.
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