SBD/August 25, 2011/Media

Hook 'Em: Longhorn Network Signs Distribution Deal With Verizon FiOS

Longhorn Network will launch Friday to handful of subscribers

Longhorn Network nabbed its biggest distributor late yesterday, signing Verizon FiOS to a carriage deal. The deal takes effect Sept. 1, two days before the channel's first football game, Rice-Texas. Verizon will make LHN available nationally. Eventually, it will make the channel available online, on tablets and on smartphones. The channel will formally launch tomorrow to a handful of subscribers. ESPN, which is managing the channel, has signed several deals with small distributors in the state, and will be making formal announcements before the launch. The channel is believed to be close to agreeing with Grande Communications, as well, sources said. However, the biggest distributors in Texas appear to be far from a deal, including the state's biggest cable operator, Time Warner Cable, the state's biggest satellite distributor, DirecTV, and the country's biggest cable operator, Comcast. The big distributors have questions over what programming the channel can actually carry, like high-school games and intra-conference matchups. LHN is seeking $0.40 a subscriber a month from distributors in Texas, Louisiana, New Mexico and Oklahoma (John Ourand, THE DAILY). CABLEFAX DAILY cites a source as saying that LHN is “‘not even close’ to scoring with Time Warner Cable.” But ESPN VP/Programming & Acquisition Dave Brown insists, “We’re in great shape.” He added that “active distribution discussions should bear fruit imminently.” Brown is “pleased with the ‘incredibly good’ response the net has received from advertisers” (CABLEFAX DAILY, 8/25).

WHERE NCAA STANDS: NCAA President Mark Emmert during an appearance on "The Dan Patrick Show" Tuesday discussed the NCAA's stance on LHN. Patrick asked, "I'm trying to understand the NCAA and their reaction to the University of Texas getting their own network and being in bed with ESPN. Why did the NCAA allow that to happen?" Emmert: "First of all, we don't have any legal authority over who a university builds an affiliation with a TV network. They can do that if they want. Of course, conferences are doing that right now.” Patrick said that "gets into dangerous territory," and asked, "Is it an unfair advantage for Texas with the other schools in the Big 12?" Emmert: “That's the important question that we do have to get involved with, and we have just recently a couple weeks ago ruled that the broadcasting of high school … events of any kind would constitute that kind of unfair advantage.” He added, "The very real concern is that an institution, or even a conference for that matter, could or might broadcast games or events with potential recruits in it and therefore become a very attractive place to that student-athlete.” Patrick then asked, "Are you going to tell other schools they can't do what Texas is doing?" Emmert: "We're going to tell them that they cannot broadcast high school games no matter what their conference network or institutional network is” ("The Dan Patrick Show," 8/23).

BIG MONEY: The WALL STREET JOURNAL's Vascellaro & Everson note the "prices for collegiate TV rights are rising because the rabid fan bases for such sports are one of the few audiences TV programmers can count on to tune in for live broadcasts." But the "big checks for Texas and other college sports programs have sparked new discussion about how the money should be used and what strings should be attached." UT's share of the $15M "yearly average from the Longhorn network still pales in comparison with the money that flows" to NFL teams. But elsewhere, "some collegiate TV rights are approaching the realm of some professional sports leagues." College athletic officials note that "TV funds are also critical amid university belt-tightening and the escalating arms race for players, who have gotten harder to recruit as more schools are competing for the best talent." UT plans to "allocate around $5 million of the funds from its new TV network to the school each year for the next five years and to contribute the rest to the athletics program's $154 million-a-year budget." UT men's AD DeLoss Dodds said the money "is far more than we expected" (WALL STREET JOURNAL, 8/25). CNBC.com's Darren Rovell noted UT "will receive $10.98 million a year and receive guaranteed three percent bumps" through the life of LHN's contract with ESPN. But the university "will only receive the truly big bucks -- equal to 70 percent of the net revenue -- after ESPN nets $295 million on the project." Rovell wrote, "That might never happen. Carriers will surely come, but at what price will they accept a deal? And how many Longhorn fans will push their local carriers to get something done with one football game and eight men's basketball games?" (CNBC.com, 8/24).

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