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Distributors Hope SportsNet LA Impasse Serves As Turning Point On Carriage Fees

Pay-TV distributors are "hoping the Dodgers fiasco" regarding SportsNet LA carriage "will be a turning point in a wider industry debate over sports programming costs," according to Joe Flint of the WALL STREET JOURNAL. Cable and satellite providers "blame sports fees, which have been rising for two decades, for causing bills to skyrocket and giving consumers a reason to 'cut the cord.'" Critics have said that while national channels like ESPN "play a big role, regional networks with a narrow focus -- in some cases on individual teams -- have been proliferating and charging steep prices for carriage." Time Warner Cable, which owns SportsNet LA, this season "sought monthly fees ... that went over $4 per subscriber in some cases." TWC said that it has "priced the channel fairly, and accuses other distributors of hypocrisy, because many also own sports channels and charge high prices." SNL Kagan data shows that sports "accounts for about 20% of all programming expenses for distributors," with the majority of those costs "passed on to consumers." Meanwhile, Comcast SportsNet Houston has "failed to get distribution" on DirecTV and AT&T, "leaving half the city's market" without Astros and Rockets games for two seasons. But backers of sports channels have said that they are "vital to the future of pay television." Desser Sports Media President Ed Desser said, "Clearly it's expensive but a distributor that doesn't carry sports does so at its own peril." Some L.A.-area distributors said that they "lost a small number of subscribers because they didn't carry" SportsNet LA, but it "was a small dent" (WALL STREET JOURNAL, 9/30).

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