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SBJ/January 23-29, 2012/Media
RSN talks ready to heat up in California
Published January 23, 2012, Page 3
The Pac-12 already has started formal negotiations, and sources said the conference is looking to be paid more than 80 cents per subscriber a month in market, which would be on par with the Big Ten Network.
The cost includes the Pac-12’s planned national channel and access to at least one of its planned six regional channels.
|“We spend the majority of our time in these meetings talking about how compelling our content is. That’s what will carry the day.”
Pac-12 Enterprises President
Meanwhile, Time Warner Cable has yet to send out formal offer sheets to distributors for its two planned regional sports networks that will carry Los Angeles Lakers and Galaxy games in English and Spanish.
Distributors say they have received no indication about what Time Warner Cable will charge for the channels, but several said they expected the price tag to be about $3.50 a subscriber per month. According to SNL Kagan, only three RSNs cost higher than $3.50: Comcast SportsNet Mid-Atlantic, Fox Sports North and NESN. But the average cost of $1.75 a channel would be among the industry’s lowest.
Time Warner Cable would not comment on negotiations.
Both Time Warner Cable and the Pac-12 are entering these talks with several advantages. As the dominant cable operator in the Los Angeles market, Time Warner Cable’s RSNs will have guaranteed distribution throughout the market for its planned launch later this year. Time Warner Cable controls about 1.7 million of the 2.4 million cable homes in the market.
The Pac-12 already has signed carriage deals with In Demand, a consortium of cable operators that include Comcast, Time Warner Cable, Cox and Bright House. The cable operators will carry the new Pac-12 channels when they launch later this year.
“We were looking at the competitive landscape when we came up with the plan,” said Chris Bevilacqua, who is a consultant with the Pac-12. “Achieving full distribution on a cable platform was critical.”
Time Warner Cable may have some challenges creating a pitch to operators for its planned RSNs, especially if its carriage fight with MSG Networks continues in New York, where RSNs MSG and MSG Plus have been dark since Jan. 1.
Distributors say they are keeping an eye on that carriage fight as they gear up for negotiations with Time Warner Cable’s RSNs. It could be hard to fight RSN pricing on one coast while negotiating carriage deals for high-priced RSNs on another coast.
Time Warner Cable has said that price is only part of the reason for its MSG dispute and has assailed MSG’s decision to bundle a poorly rated music channel called Fuse with the RSNs.
As of last week, a resolution appeared to be a long way off.
“There really is nothing going on,” said MSG President Mike Bair. “I would term it as bleak at this point.”
Distributors say that talks with the Pac-12 continue and that they have not hit significant snags. Stevenson would not confirm specifics, but said the conference’s pitch centers on the channels’ programming.
“We spend the majority of our time in these meetings talking about how compelling our content is,” he said. “That’s what will carry the day.”
Stevenson talks about a schedule that will include 35 football games, with each school appearing at least twice on the channel.
“Every one of the conference’s games will be on national TV next year,” Stevenson said. “It’s important for potential distributors to understand that.”