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Volume 21 No. 1
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Tennis Channel still awaits wider distribution

In 2008, when Tennis Channel won the right to show some U.S. Open matches live, network President and CEO Ken Solomon was euphoric.

At the time the channel, which launched in 2003, was in only 25 million homes. Its executives believed that live U.S. Open rights that run through 2014 — plus rights to the sport’s other majors — would be the linchpin to growth. Solomon compared the feeling of securing U.S. Open rights as similar to winning the Super Bowl.

The network filed a carriage complaint at
the FCC against Comcast.
Two years after the rights kicked in, that Super Bowl-winning feeling has to be a distant memory. While the network has added more rights and higher-profile talent, its distribution has remained virtually stagnant. Since signing the U.S. Open deal, the network has added only a handful of subscribers — channel executives say they now have around 30 million homes, thanks largely to a deal with AT&T U-verse in June 2010.

Cablevision, Comcast and Time Warner Cable carry the channel on their sports tiers, a higher-priced premium tier that generally struggles to attract subscribers.

Tennis Channel’s frustrations with trying to move off the big cable operators’ sports tiers have become so intense that the network has looked for regulatory solutions as a way to help it gain wider distribution.

At the beginning of 2010, Tennis Channel filed a carriage complaint at the Federal Communications Commission against the country’s biggest cable operator, Comcast. Tennis Channel’s complaint alleges that Comcast is favoring its own sports channels, like Golf Channel and Versus, over unaffiliated ones. Tennis Channel wants Comcast to move it off the company’s sports and entertainment tier and onto its digital basic tier, where similar sports channels like Golf and Versus reside.

Tennis Channel executives cite the federal Communications Act, which says that cable operators, like Comcast, can’t manipulate the marketplace to favor their own networks over their competitors.

Tennis Channel’s regulatory strategy looks like it’s working so far. Last month, the commission’s enforcement bureau recommended that the FCC force Comcast to give Tennis Channel wider carriage.

The full commission usually follows these types of recommendations, said longtime cable industry analyst Steve Effros.
The problem for Tennis Channel is that even if the commission takes the recommendation, it’s unlikely that Comcast would move the channel to a better programming tier immediately. Effros said that cable operators have been looking into whether it should allow the courts to act on program carriage disputes like this.

“As an interim play, it’s probably helpful for Tennis Channel to get over that first hurdle,” Effros said. “But there’s a bigger question: Is any of this legal? I don’t think it is.”

Effros suggested that cable operators have a good First Amendment argument against these types of complaints. Effros, who worked at the FCC as an attorney adviser for five years in the early 1970s, believes that cable operators legally should be able to make editorial decisions about what channels they want to carry.

“The real question is whether the cable industry is going to challenge this,” Effros said. “If there are programmers that intend to rely on this as part of their long-term plan, they are making a mistake.”

While the case works its way through the system, Tennis Channel is gearing up for this year’s U.S. Open. To supplement its television coverage during the event, Tennis Channel is rolling out a lot of video via broadband on, including live match streaming.