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10/18 2010

If News Corp Won’t Sign With Cablevision, Can They Trade Fox to Verizon For Draft Picks?

Posted by Dan Levy.

People who have Cablevision in New York didn’t see Saturday night’s NLCS game between Roy Halladay and Tim Lincecum. More importantly for most in that region, they didn’t see the Giants game on Sunday.

Perhaps most importantly, if the negotiations between News Corp and Cablevision don’t become more amicable soon, they may not get to see Glee.

That is when the real panicking starts.

Per the NYT:

About three million households in the New York metropolitan area were left without Fox programming on Saturday and Sunday, preventing sports fans from watching a Phillies game on Saturday night and a Giants game on Sunday afternoon. After months of negotiations, the two companies cannot agree on a price for retransmission of the Fox network.

Cablevision and the News Corporation talked for only a few hours on Sunday, and Fox said they were still far apart. By Sunday evening, television analysts who had predicted a resolution by the kick-off of the Giants game wondered aloud whether the two media giants could drag out the fight until the start of the World Series, which Fox is to start broadcasting on Oct. 27.

Brian Stelter of the NYT tweeted out this video, shown on the channels that used to be Fox5 and My9.

I wonder what the ratings are for this video on those channels.

I’ve been following this network rights fee business for a while, including many a report at Sporting News about the posturing during Bowl season last year, but nothing seems as untenable as this situation in New York. They almost always get worked out in the oft-resolved “11th hour” timeframe.

Could you imagine, seriously, a cable provider not having Fox on their lineup during the NFL season? Could you imagine the Yankees making the World Series and some viewers not being able to get the channel because of a rights fee dispute?

This, of course, isn’t the first time Cablevision has gotten into negotiations that led to a blackout. Remember last year’s situation with ABC led to people missing part of the Oscars. But a Giants game? In New York? It seems impossible.

Yet it happened. And it might keep happening.

News Corp wants $150 million in fees from Cablevision, up from $70 million. With the sides so far apart, Cablevision has implored the government to step in. Obviously News Corp doesn’t want that, asking for more time to conduct business-to-business negotiating. A lot of good that’s done so far.

Having said that, I don’t see how letting the government handle this situation is the right way to go either. They basically created this mess with the mandatory conversion to digital cable. Now that you can’t get any signals with traditional rabbit ears, the networks have a lot more leverage — leverage that stations like ESPN and TNT have been using for years to force cable providers into high rights fees — over the cable providers, certainly leading to companies like Cablevision getting squeezed.

Now Cablevision is left with a choice…make a public issue out of the dispute to try and convince their customers they are fighting for their rights, or suck it up, pay the additional cost and roll that cost onto the consumer. In this case, Cablevision would rather take a stand and risk the loss of customers than hike up prices and guarantee the loss of others. It’s a fascinating PR decision, and it seems everyone is losing.

I’ve used this line about six hundred times, but a dispute like this — remember, this is between the Dolan family and Rupert Murdoch for crying out loud — is like watching two bullies fight after school over our lunch money.

I guess in this case, if the fight was on FOX, those in New York couldn’t even watch it.

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Posted on October 18, 2010 at 1:25PM

 

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  1. zambonirodeo
    10/18 2010

    But you *can* get TV with rabbit ears. More channels than ever, and all in HD. It’s only if you don’t have a new enough TV (or a convertor, 46 million of which were given out for free), or if your digital TV is so low-end that it doesn’t have a tuner, that you are out of luck. But I would have to think that a large majority of the people affected here, viewers who like sports enough to be truly agitated about this and can already afford an $80 cable bill, do have the right TVs. They’ve just never bothered to find out.