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MOUSE EARS: DISNEY OFFER EXAMINED AS FOX PONDERS NEXT MOVE
Published August 7, 1998
Fox "is looking at matching" Disney's offer to more than double TV rights fees for the NHL, according to sources of Stephen Battaglio of the HOLLYWOOD REPORTER. Fox has until August 14 to retain the broadcast rights, and Battaglio writes that if Fox "does decide to go after the cable component," it could put national games on FX or FSN and "shut ESPN and ESPN2 out of a major source of product in the first half of the year" (HOLLYWOOD REPORTER, 8/7). The N.Y. TIMES' Richard Sandomir put the broadcast portion of Disney's total offer at "about" $250M -- the number Fox has to match by August 14 (N.Y. TIMES, 8/6). In Toronto, Rob Longley writes, "Don't expect Fox to abandon the NHL immediately," because even though its RSNs have regional TV rights to 19 NHL teams, "it would like to maintain a national presence" (TORONTO SUN, 8/7). NO INCREASE: ESPN spokesperson Mike Soltys said if the network's bid is successful, ESPN "will not impose an NHL surcharge" on cable operators: "There was one report saying we have a clause in our affiliate contracts that permits us to increase fees when we pay higher rights fees for sports programming. There's no such clause" (NEWSDAY, 8/7). WHY SO MUCH? In N.Y., Richard Sandomir writes, "You must wonder what Disney's strategy is beyond guaranteeing that hockey will stay on ESPN and ESPN2 for five more years. Clearly, this is heavily a cable play. ... But adding ABC to the mix is dumbfounding. Does ABC, a struggling network, need more low-rated programming? Wouldn't its affiliates prefer an eighth-run flick to a Saturday or Sunday night game that gets a 1.4 rating?" Sandomir writes that ABC "is stepping into a quagmire. ... Yet, Disney sees benefits to making a blockbuster bid. The Mouse Kingdom's target for such spending is questionable enough, but why do it at a time when big losses are expected from the stupendous N.F.L. deals?" Sandomir: "Perhaps it will come down to corporate egos ... Maybe Disney opted to overpay to make sure it swept Fox from hockey" (N.Y. TIMES, 8/7). USA TODAY's Michael Hiestand defends the bid, noting that it "would likely include international NHL TV distribution as well as footage from old games for ESPN's Classic Sports Network" (USA TODAY, 8/7). NEWSDAY's Steve Zipay: "On the surface, paying up to $120 million a season for the NHL ... seems wildly out of line. ... Will the deal be a money-loser? Probably. But ABC could use some winter sports programming." He also adds that Disney needs to secure future programming for ESPN2, which will soon be in 60 million homes (NEWSDAY, 8/7).