Fox Sports Buys Cleveland-Based SportsTime Ohio; Signs Indians To Rights Deal
Fox Sports Media Group completed its acquisition of Cleveland-based RSN SportsTime Ohio Friday. As part of the deal, Fox signed the Indians to a long-term media rights deal that will keep Indians games with Fox well into the next decade. Specific deal terms were not released, but sources say Fox Sports is paying more than $235M for the RSN. Fox and the Indians wanted the deal to close in '12 because of various tax issues associated with it. Fox has not decided whether it will keep SportsTime Ohio up and running, bring the Indians' rights back to FS Ohio or create a second Fox Sports-branded channel for the market. SportsTime Ohio launched in '06 with most of its programming centered on Indians games. But the channel was stuck in poor cable carriage deals that hampered future growth. SportsTime Ohio has had several discussions over the years about selling its network, including some with Time Warner Cable, which is the biggest cable operator in the area. Last season, viewership for Indians games averaged 61,000 homes on SportsTime Ohio, a big drop of 36% from '11.
YES NETWORK DEAL CLOSES: Fox' parent, News Corp., quietly closed its deal to buy 49% of YES Network early last week. The deal, which values the network at $3B, was announced last month but did not close officially until just before Christmas. Similar with the Indians' situation, both News Corp. and the Yankees wanted the deal to close in '12 because of various tax issues. As part of the deal, News Corp. has an option to increase its stake to 80% within three years. If News Corp. exercises that option, the network's valuation would climb to $3.8B. As part of the deal, YES Network will keep the Yankees' rights through '42.
PLAYING KEEP-AWAY FROM TWC: A source said Fox aggressively pursued these deals after Time Warner Cable picked up the Lakers rights and began negotiating with the Dodgers in L.A. Fox execs believe that the Lakers deal, in particular, re-set the RSN market. TWC is the dominant cable operator in N.Y. and Cleveland, the home markets of Fox' two most recent acquisitions.