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Just days away from its Friday launch, ESPN’s Longhorn Network has cut several deals with small distributors in the state and is counting on several more this week.
Late last week, ESPN executives were in final negotiations with Verizon and Grande Communications. While at deadline neither company had signed a deal, industry sources were confident that both were close at hand.
This pace of cutting carriage deals so close to a network’s launch is standard in the cable industry. Industry observers expect a flurry of deals for Longhorn Network to be cut this week, in advance of its launch.
“The Longhorns are arguably the strongest brand in the state of Texas and we are confident that, based on the content and the consumer demand, this new cross-platform enterprise will be a success for all involved,” said an ESPN spokesperson.
But 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.
Time Warner Cable appears to be the closest of those three, sources said. With systems surrounding the school’s Austin campus, Time Warner Cable would be the distributor most affected by Longhorn Network, particularly when it carries live coverage of Texas’ Sept. 3 football game against Rice.
Comcast and DirecTV are not close to deals yet, sources said.
Longhorn Network is seeking 40 cents a subscriber a month from distributors in Texas, Louisiana, New Mexico and Oklahoma.
The holdup with Comcast, DirecTV and Time Warner Cable apparently deals with questions over what programming the channel can actually carry. Sources said Comcast, DirecTV and Time Warner Cable will not agree to a deal with Longhorn Network until there’s clarity on exactly what rights the network has.
For example, proposals sent to distributors say the network will carry high school games. Earlier this month, however, the NCAA said university-related TV networks like Longhorn Network would not be allowed to broadcast games involving high school athletes.
The network also has said it will carry two football games a season, including at least one against a Big 12 Conference opponent. The Big 12 has said that Longhorn Network can carry a conference game as long as the opponent approves and the conference signs off on it.
Bob Burda, spokesman for the Big 12, said that the network is free to arrange a televised game between Texas and a conference foe, “but we just want to make sure there aren’t any unintended harmful consequences to any other members of the conference.”
Staff writer Michael Smith contributed to this report.
That’s because ESPN already created its own competitors. ESPN2 could be considered ESPN’s biggest rival. Or ESPNews or ESPNU. Or any of its broadband or mobile sites.
Even with all the money Comcast and NBC has lining their pockets, it’s virtually impossible for a single channel like Versus to become a full-fledged competitor with ESPN. Versus is in 76 million homes; ESPN is in 100 million. Cable operators pay ESPN about $4.69 per subscriber per month, according to SNL Financial; they pay Versus about 30 cents.
But Versus can start to chip away at ESPN’s dominance in the sports media world, and some recent moves by the network, which will be rebranded NBC Sports Network on Jan. 2, offer a glimpse at how the all-sports network plans to compete in the sports media marketplace: through a combination of production and promotion, plus a commitment to have all of its NBC Sports resources — NBC, NBC Sports Network, Golf Channel, Comcast SportsNet — work well together.
Mark Lazarus points to extending the NBC Sports brand on multiple platforms.
The overall success of sports networks is dependent on live sports, and that is where NBC Sports Network struggles. Live sports bring higher ratings. With a schedule that’s heavy on the NHL and, starting next year, MLS, NBC Sports Network has a good amount of live sports. The problem is that these sports haven’t proved they can deliver big ratings.
NBC wants to build those ratings, of course. But NBC’s plan, which includes pregame and postgame shows around all NHL and MLS games, seems to be to try and re-create NBC Sports Network as a high-quality network that will make other leagues, like the NFL or MLB, take notice and become comfortable about putting their games on it.
A higher-quality NBC Sports Network will better position NBC to go after big-ticket sports. NBC executives have made no secret of their desire to bring more popular games to the network. They are expected to engage the NFL on a cable package of eight live games starting next season, and it’s likely that the channel’s executives will show an interest in picking up an MLB package when those rights come due after the 2013 season.
But first things first — and that’s proving that NBC Sports Network can produce top-quality programming. Executives have been busy putting their mark on the network as a way to attract those sports.
The channel NBC Sports is operating today is virtually unrecognizable to the one that it took over six months ago as part of Comcast’s acquisition of NBC. Gone are shows produced on a shoestring that were easy to lampoon on the old Versus. NBC almost immediately eliminated series like “The T.Ocho Show,” “Whacked Out Sports” and “Sports Soup.”
“These are shows that we didn’t think NBC Sports would ever be doing,” said Jon Miller, president of programming for NBC Sports and Versus. “We’ve tried to eliminate all off-brand shows like that.”
Much of the reason for producing a show like this, of course, is to help market NBC’s important “Sunday Night Football” franchise. It’s also, obviously, a way to deepen a relationship with the NFL in the months before the league awards a new TV package of eight live games.
NBC is depending on the quality of those relationships — and that kind of promotion — to help it convince rights holders to move to Versus.
MLS Commissioner Don Garber referenced NBC’s promotion as a main reason why he was comfortable about moving MLS games from Fox Soccer to NBC and the rebranded NBC Sports Network.
“A key point for us is that Jon Miller and NBC have a tremendous reputation for promoting their properties,” Garber said. “I’ve watched with envy what they’ve done for the NHL. We hope NBC can do for soccer what they’ve been able to do for hockey.”
MLS has drawn anemic viewership figures at the league’s other network partners. After 12 telecasts this year, ESPN and ESPN2 are averaging a combined 308,000 viewers for MLS games; Fox Soccer is averaging 77,000 after 15 telecasts. Those aren’t the types of numbers that drive a rebranded network’s growth.
But NBC is looking at the big picture.
“We’ll be strategic about how we program the games,” Miller said, pointing to the planned pregame and postgame shows for every MLS game as evidence of the care and attention NBC devotes to its partners. “We will promote MLS in our other programming, including the Olympics, to try and bring other viewers into the sport.”
The message, particularly to the NFL and MLB, is clear: Promotion and production is how NBC believes it sets itself apart from its competitors.
“We’ve done an awful lot in a short period of time,” Miller said. “We want NBC Sports Network to be stickier.”
John Ourand can be reached at firstname.lastname@example.org. Follow him on Twitter @Ourand_SBJ.