UPDATE:No Game, No Talks Between YES, Comcast
Barring a last minute — and unlikely — reprieve, the Opening Day games of two of the most popular teams in Major League Baseball — the New York Yankees and the Los Angeles Dodgers — will be dark to more than 1 million pay TV customers on April 4.
The ongoing big-market disputes are a sign that perhaps sports programming, once thought to be bulletproof, is weakening in the era of skinny bundles and over-the-top video.
Comcast in November refused to pay what it called a 33% increase in fees charged by YES Network, the New York-area RSN that features most Bronx Bombers games. Comcast’s customers missed out on Brooklyn Nets National Basketball Association games, but many thought the operator would cave in by the start of the baseball season. YES, owned by Fox Sports Network Group and the Yankees, was carried in about 900,000 Comcast homes in parts of New Jersey, Connecticut and Pennsylvania.
L.A. FADEAWAY
Time Warner Cable’s SportsNet LA, home to the Dodgers, continues to be spurned by distributors in Southern California including AT&T, DirecTV and Cox Communications. Time Warner Cable, which carries the RSN in L.A. along with Charter Communications and Bright House Networks, even agreed to offer a one-year discount — later extended to six years — and was still rejected.
Distributors have complained about the high cost of sports programming for years, but as sports rights charges have climbed and fees for networks have hit the stratosphere, pay TV providers are pushing back.
Some analysts say sports programming, once thought to be must-have content because of its live viewing nature and predominantly young male audience, is vulnerable as operators attempt to create “skinny” bundles for price-conscious customers.
“Clearly, there’s an appetite for a lower-cost package with less sports programming,” Telsey Advisory Group media analyst Tom Eagan said.
Comcast executive vice president of consumer services Marcien Jenckes said he sees the YES dispute in simper terms: the operator’s perception of the value of the network doesn’t match the price. Comcast has claimed that its customers in the New York market aren’t big YES watchers and haven’t much missed the channel since it came off on Nov. 18.
At $5.93 per month per subscriber, according to SNL Kagan, YES is the priciest RSN in the country — and at about $2.50 per subscriber per month higher than another New York area RSN, MSG Network, according to Kagan.
“At a more reasonable price, they would be a great value proposition,” Jenckes said.
YES CEO Tracy Dolgin has taken Comcast’s argument to task. He said YES programming is rated No. 1 in Comcast’s New York area territories on game days. And he said YES also out-rated SNY, partly owned by Comcast, by a margin of 5 to 1 in its Connecticut footprint on game days.
About 40% of Comcast’s 900,000 subscribers in the New York area consider themselves Yankees fans, Dolgin said.
YES: RATE WAS NO SURPRISE
While Comcast has said it is looking for a lower price, Dolgin noted the operator had been paying the higher rate for more than eight months — its deal originally expired in February. Dolgin said it is misleading to say a price that it has been paying for nearly a year is suddenly too high.
Dolgin said that other RSNs vary in price depending on the market; operators on the fringes of a team’s territory usually pay less than those in the heart of the market. YES does not have so-called zoned pricing like others do, including Comcast-owned RSNs.
“What we charge for YES is less than what Comcast charges for some of their owned-and-operated regional sports networks in the intermarket where the Comcast subs are,” Dolgin said, calling the Kagan estimate “way over” what Comcast was paying.
YES will keep running ads urging Comcast customers to switch providers, Dolgin said.
“It’s not easy, but Yankee fans are very passionate. In the month of April there are 23 Yankee games and 20 are exclusively on the YES Network. If you’re a Yankee fan, you either feel like a victim, or you switch.”
