By RICHARD SANDOMIR
Published: January 20, 2007

Major League Baseball is close to announcing a deal that will place its Extra Innings package of out-of-market games exclusively on DirecTV, which will also become the only carrier of a long-planned 24-hour baseball channel.

Extra Innings has been available to 75 million cable households and the two satellite services, DirecTV and the Dish Network. But the new agreement will take it off cable and Dish because DirecTV has agreed to pay $700 million over seven years, according to three executives briefed on the details of the contract but not authorized to speak about them publicly.

InDemand, which has distributed Extra Innings to the cable television industry since 2002, made an estimated $70 million bid to renew its rights, more than triple what it has been paying. Part of its offer included the right to carry the new baseball channel, but not exclusively.

The baseball channel is scheduled to start in 2009.

M.L.B., DirecTV and InDemand officials declined to comment.

DirecTV is also the exclusive outlet for the N.F.L.’s Sunday Ticket package, for which it pays $700 million annually. Sunday Ticket has about 2 million subscribers; Extra Innings about 750,000, according to The Sports Business Journal.

Extra Innings lets subscribers, for a fee, watch about 60 games a week from other local markets except their own.

The only other way that fans without DirecTV will be able to see Extra Innings will be on MLB.com’s mlb.tv service, but they must have high-speed broadband service. About 28 million homes have high-speed service, less than half the number of cable homes in the country. The picture quality of streamed games is not as good as what is available on cable or satellite.

DirecTV is available to about 15 million subscribers.


Copyright 2007 The New York Times Company

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edited in after i brought it up

by Maury Brown

Last summer, I wrote in Blackout Blues how MLB’s arcane territorial television broadcast system restricts consumer options for those that wish to see MLB games out-of-market through MLB.com or MLB Extra Innings. Now, MLB may be creating even more restraints on consumers.
John Orerand and Eric Fisher of the Sports Business Journal have reported that MLB is in advanced talks with DirecTV to make the satellite television company the exclusive provider of MLB Extra Innings. While Extra Innings was initially only offered on DirecTV in 1996, the package has been available on cable since 2001, and on Dish Network since 2004.

If the deal is approved, it is sure to raise the ire of cable interests like Comcast. In fact, the move would seem to be a game of high-stakes poker for MLB, considering that members of Congress and the NFL have been sparring over the latter's decision to use DirecTV as the exclusive provider of the Sunday Ticket package.

In early December, Senator Arlen Specter (R-Pa.) introduced a bill that would repeal the NFL's antitrust exemption under the Sports Broadcasting Act of 1961. Currently, the NFL negotiates the broadcast rights for all of its 32 teams. Specter’s bill would repeal that ability and set up a scenario in which teams would negotiate television deals separately. "As I look at what the NFL is doing today with the NFL channel with the DirecTV ... a lot of people, including myself, would like to be able to have that ticket," Specter said. How Specter factors into the MLB deal with DirecTV has more to do with just his interest in protecting consumers. As noted, Specter is a senator from Pennsylvania. Comcast is headquartered in Philadelphia, and owns In Demand, the company that provides MLB Extra Innings on cable.

Specter's ability to strike fear in the NFL or MLB has lessened since November. Specter was the Senate Judiciary Chairman, but with control of Congress shifting to the Democrats this month, Senator Patrick Leahy (D-Vt.) takes control as chairman of the committee. While Specter is no longer chair, however, he still wields considerable power in Congress, and Leahy hasn't exactly been in MLB’s corner in the past. Leahy helped narrow the scope of baseball's antitrust exemption during the 2002 Congressional hearings on the exemption, saying in his opening statement at the time,

Between the narrowness of the way the Supreme Court had perpetuated baseball’s antitrust exemption-- only as it applied to labor-management relations-- and our work in the Congress, in which we struck the last remaining remnant of the judicially-created exception to the applicability of the antitrust laws, it seems that there is no longer any basis to contend that a general, free-floating baseball antitrust exemption somehow continues to exist.
As for DirecTV itself, the company has other ties to MLB than just a possible exclusive agreement for Extra Innings.

On December 22nd, Rupert Murdoch agreed to sell his control of DirecTV to Liberty Media in exchange for the $11 billion stake that Liberty Media had in News Corp. With that, Liberty gets control of three regional sports networks (RSNs), including Fox SportsNet Pittsburgh, Fox SportsNet Northwest, and Fox SportsNet Rocky Mountain. But the ties to MLB are about to go deeper than that.

As I detailed in late June of last year, the Braves are about to be part of a large and complex stock-swap scheme between Time Warner and Liberty Media. In other words, soon Liberty Media will own the Braves, several RSNs, and DirecTV, the company with which MLB is negotiating the exclusive agreement. (This is on top of DirecTV's deal with the NFL for Sunday Ticket and its deal with NASCAR.)

DirecTV has even approached the NHL about an exclusive deal for out-of-market games. Liberty's influence will soon reach far beyond just MLB: it will suddenly have holdings that stretch across a vast array of professional sports in terms of owning a franchise outright and controlling a large system of broadcasting outlets.

All of this sets up an interesting and possibly volatile situation with Congress, and a new and suddenly powerful force in MLB's ranks. An exclusive DirecTV deal with MLB will place the sport in the sights of Congress yet again. If the deal goes forward, it will be one more example of consumer restriction. There is already ill-will amongst those caught up in the convoluted blackout policy as it pertains to out-of-market broadcasts. There were approximately 750,000 subscribers to MLB Extra Innings last season. How do you think fans will react when they find out that not only are they caught in the "Blackout Blues," but that many will also have to jump from cable to DirecTV for that dubious privilege? One might surmise that there will be fewer subscribers this year than last.

If you've been watching Extra Innings on cable, you'll need to hold off until you see whether this deal goes the DirecTV route. You may have to start finding a nice place to mount that dish on your house.

So football, basketball and finally baseball will each have their own channel.

DirecTV paid about 30 million more a year for exclusive rights but cable will no longer carry it. Ultimately it screws the hard-core fans that want to see their team but doesn't want to watch it on the Internet. This doesn't affect me since I already get DirecTV. Extra Innings is the greatest investment I make year after year, as it cost around 89 cents a game for my team.

I spend so much money on DirecTV since moving out of Chicago. I get the football, baseball and basketball packages.

The only complaint I have is that while I get the local Chicago channels, which are broadcasting in HD, they aren't yet available in HD through DirecTV.

well, i guess i'll be getting directv in a few years.

me too.

Baseball TV deal contested

MLB is trying to move Extra Innings package exclusively to DirecTV, but there's resistance.

By Larry Stewart, Times Staff Writer
February 3, 2007

Red Sox Nation has spoken. A pending deal by Major League Baseball to put its Extra Innings pay package exclusively on DirecTV may have to be put on hold now, buffeted by an uprising involving baseball's most ardent fans, spearheaded by those who live and die with the Boston Red Sox.

MLB expected to announce the deal as early as next week, but that was less certain after Sen. John F. Kerry (D-Mass.) on Thursday asked the Federal Communications Commission to investigate the matter.

For five seasons, MLB's Extra Innings has offered up to 60 regular-season, out-of-market games a week on cable, through the In Demand service, as well as DirecTV and Dish Network.

Under terms of the new deal, DirecTV reportedly would pay $100 million a year over seven years for the rights to the package. In Demand reportedly had offered $70 million a year to retain Extra Innings.

The crux of the deal apparently centered on MLB's plans to launch its own channel in 2009, similar to NFL Network and NBA TV. According to a source familiar with the negotiations, MLB unsuccessfully used Extra Innings as a negotiating wedge to get cable to put the new channel on a basic tier rather than a pay tier so it could get the widest exposure possible.

Cable companies, including Time Warner in L.A., often seek to place such niche offerings on a pay sports tier so that only the customers who want them have to pay for them. Last year, a similar carriage dispute took NFL Network off Time Warner.

Sports television consultant Neal Pilson said Friday it is his understanding that, indeed, the baseball channel "was a component" in the negotiations. But, he added, "Baseball is almost religious in its financial analysis before making any deal and you can be sure there has been a lot of deliberation and a lot of research that has gone into this."

That didn't matter to fans, who have been voicing their displeasure since news of the pending deal broke two weeks ago.

Michael Abramowicz, 34, of Arlington, Va., is a law professor at George Washington University who gets Extra Innings on cable. He talked about the pending deal in a blog last week. "My reaction to this has been genuine sadness," he wrote. "Watching baseball games is my No. 1 hobby, and my house can't get DirecTV because of nearby trees. It did occur to me that if I chopped down my neighbors' trees, I would probably do a year in jail, which would leave me six years to enjoy the games."

Reached by phone Friday, Abramowicz said he would switch to DirecTV to keep Extra Innings if he could.

Ryan Hecht, 34, of Queens, a Time Warner Cable subscriber and a die-hard Dodgers fan, is in the same situation as Abramowicz. Reached by phone Friday, he said, "I'd switch to DirecTV if I could, but my landlord will not let me install a satellite dish."

The issue gained national attention when Kerry on Wednesday said he would question FCC Chairman Kevin J. Martin at a previously scheduled Senate Commerce committee hearing the next day.

Kerry left the hearing early, though, and instead faxed a letter to Martin, citing concerns about the deal and contending that Extra Innings has been available to 75 million subscribers but would be available to only 15 million if DirecTV has it alone.

Of the 500,000 subscribers to the Extra Innings package last season, 270,000 were with DirecTV, according to sources. Going by those numbers, 230,000 would be left out this season.

DirecTV has a disproportionate number of Extra Innings subscribers because it caters to sports fans. NFL Sunday Ticket, by far the most popular pay sports package, has always belonged to DirecTV exclusively, and the rights fee is now a whopping $700 million a year. That package's exclusivity never caused much of an uproar among fans because it was never available on cable.

Kerry, in his letter, said, "In the case of my hometown team, Red Sox Nation stretches all across our country from coast to coast. I am concerned that this deal … will separate fans from their favorite teams."

Kerry could not be reached by phone Friday, but Vince Morris, a spokesman, said the senator is taking up the fight not only because he is a Red Sox fan but because people had been approaching him, seeking answers.

"He wants to find out more facts and find out what the FCC can do," Morris said.

An FCC spokesman would not comment on Kerry's letter. The agency has some authority over cable and satellite television but generally stays out of programming issues that don't involve local content.

The FCC has allowed NFL Sunday Ticket to be offered exclusively on DirecTV since 1994. However, News Corp. has filed a request for permission from the FCC to transfer its controlling 38.5% stake in DirecTV to Liberty Media Corp in a swap of assets, and any complaints about baseball's Extra Innings deal could come up in that review.

Those involved in the deal declined to comment, but baseball executives have privately suggested that fans with cable can subscribe to the broadband package, which cost $79 last season, $100 less than what Extra Innings cost.

But Hecht, for one, isn't buying it, saying, "There is no substitute to kicking back on a couch and watching a game on a TV screen."

Times staff writer Jim Puzzanghera contributed to this report from Washington.



Copyright 2007 Los Angeles Times

fucking hell i can't believe my fate is in the hands of john kerry again

The Office of the Commissioner of Baseball
245 Park Avenue, 31st Floor
New York, NY 10167
(212) 931-7800

Link

The announcement of the deal to make MLB Extra Innings available only on DirecTV may be announced as early as next week, as a last-ditch effort by the cable industry to match DirecTV's offer has been rebuffed.

As reported by Eric Fisher and John Ourand of the Sports Business Journal on today's Sports Business Daily Link

Sources familiar with the negotiations said cable reps went back to MLB about a week ago and offered to match the financials of DirecTV’s bid but without the requirement of exclusivity. The cable lobby also agreed to guarantee the same amount of distribution for MLB’s planned channel, which is scheduled to launch as soon as ’09.

As Fisher and Ourland outline, however, the counter-bid did not address a key want by MLB in terms of the 24-hour baseball-only channel; the ability to place the channel on the basic tier. The Basic tier is available to all subscribers. As reported, "As a result, the most recent talks with cable officials failed to gain any significant traction, industry sources said."

...

I've dreamed of having this for years. Who knows if it'll ever happen now.

Oh please don't just put links. Cable negotiations with major sports leagues gives me hella wood, and it's too hard to squeeze one out when I have to click a link and then the pop-ups block my screen befo--ungghhghhh.

Full story: CNN Link

Baseball could get more money if it drops plan to let DirecTV have exclusive deal to sell out-of-market games to hard-core fans.

A weekly column by Chris Isidore, CNNMoney.com senior writer

February 27 2007: 6:37 AM EST

NEW YORK (CNNMoney.com) -- Long-distance relationships may not work for romances. But it's a different story for sports fans.

Professional sports leagues are tapping into the interest that many fans have for their favorite team even after they've moved far from home. It is quickly becoming one of the fastest-growing sources of revenue for the leagues...and one of the more controversial.

While local and national broadcast sports rights fees are showing only solid gains, if that, the leagues are seeing the rights fees for out-of-market games soar. Some fans pay a couple of hundred dollars a year to watch games not available in their home market.

Such packages seem to be a small price to pay for Boston fans far from Red Sox Nation or Packers fans in warmer climates. So it's not surprising that cable and satellite television providers have been fighting for the packages as a way of attracting customers.

Major League Baseball is close to selling the rights to its "Extra Innings" package of out-of-market games for $100 million a year -- or more. That's more than triple the $30 million or so a year that sources said baseball got in its last Extra Innings deal.

When the NFL renewed its exclusive package for Sunday Ticket with DirecTV (Charts) in late 2002, it got $400 million a year, up from $130 million a year previously, according to trade publication Sports Business Daily. And DirecTV agreed to pay $700 million a year for the Sunday Ticket rights when the contract was renewed again after the 2005 season, according to the publication, according to the publication. More than 2 million fans had that package last year, according to an estimate from Kagan Research.


The controversy comes because DirecTV is trying to get an exclusive contract to carry the MLB package, as it already has with the NFL. That has raised criticism and threats of legislative action by Sen. John Kerry, D-Mass., along with a statement by Federal Communications Commission Chairman Kevin Martin that he is also concerned with the expected change.


One source familiar with negotiations said he now believes that the Extra Innings package will remain available to all three services.

"I'd be surprised if the DirecTV deal goes through," he said.

The key isn't likely to revolve around more money, but an agreement by the cable operators to provide broader carriage for a Baseball Network which MLB intends to start operating in 2009.

DirecTV had been willing to let all 15 million of its subscribers have the new Baseball Network right from the start, as well as helping with some of the start-up costs, according to multiple sources. It isn't willing to be as helpful to MLB's upstart network if it doesn't gain the advantage of an exclusive deal on Extra Innings, though.

But after initially rebuffing the MLB demands for carriage of the Baseball Network, the cable operators are now coming around, according to the industry source.

"There will be a commitment to carry the Baseball Network (on cable)," said the industry official. "Where it will be placed, that still needs to be sorted out."

Another source with the league said he was not aware of any shift away from plans to go with an exclusive deal for DirecTV. But talks have lingered for months without an official announcement even as baseball's opening day draws near.


The motivation for the exclusive deal has been reported -- incorrectly -- as baseball's desire to get the top rights fee for the Extra Innings package.

The big cable companies, which collectively own a service called In Demand that airs the Extra Innings games, were reportedly willing to pay $70 million a year for a non-exclusive deal. (As reported in a story up thread they matched the $100 million offer and still would be non-exclusive.)

And while DirecTV won't offer $100 million for a non-exclusive deal, it seems safe to say that it and the Dish Network, along with the telephone companies that are making their own push to provide television service, would easily pay more than $30 million combined for non-exclusive deals.


© 2007 Cable News Network

Last Update



Baseball TV deal goes through, with a twist

League gives DirecTV Extra Innings package and others a chance to match deal. But cable and Dish Network balk at requirements.

By Larry Stewart, Times Staff Writer

March 9, 2007


The long-anticipated announcement by Major League Baseball to shift its Extra Innings pay package to DirecTV came Thursday — but with a twist that one high-ranking cable executive called a "sham."

MLB President Bob DuPuy said the seven-year agreement with DirecTV — first reported in January as an exclusive deal — includes a new provision that would allow the package to remain on cable television and Dish Network if certain criteria are met. But the window to negotiate closes April 1.

It was DirecTV's exclusivity that triggered fan protests and led to an inquiry by the Federal Communications Commission.

While financial terms of the deal were not disclosed Thursday, it was believed that DirecTV, which has 15 million subscribers, had agreed to pay $100 million a year — if it retained exclusivity.

Until now, Extra Innings offered up to 60 regular-season, out-of-market games a week on cable, through the In Demand service, as well as on DirecTV and Dish Network.

"In response to the concerns of our fans," DuPuy said, "baseball has negotiated with DirecTV to offer the package to incumbents In Demand and Dish, through the end of the month, until the start of the season on April 1. If they sign up at the same rates and carriage requirements [as DirecTV], they will get our out-of-market package and they will get the Baseball Channel."

The Baseball Channel, which MLB plans to launch in 2009 with DirecTV as a minority partner, has been the key to the months-long talks. MLB wants cable to agree to carry the channel on a basic tier, not a premium tier.

Industry sources indicated that would never happen.

"Everyone sees this as the sham that it is," the high-ranking source said.

Time Warner, the nation's largest cable provider, has 50 million subscribers. A carriage agreement equal to DirecTV's would require it to distribute the Baseball Channel on a basic tier and, the source said, subscribers could end up paying whether they watched or not.

"You'd be asking 50 million people to pay, say, $2.50 a month so that 200,000 could get Extra Innings," the source said. "That's not going to happen."

EchoStar, which owns Dish Network, echoed that in a statement Thursday: "DirecTV and MLB, as owners of the package, should not be able to line their pockets at the expense of consumers who don't want and won't watch [baseball] content."

In Demand President and Chief Executive Robert Jacobson said: "Major League Baseball has chosen to cut a de facto exclusive deal, which include conditions for carriage that MLB and DirecTV designed to be impossible for cable and Dish to meet," he said. "This decision represents the height of disrespect and disregard for their loyal baseball fans."

It was the protests by fans that drew the attention of Congress and Sen. John F. Kerry (D-Mass.), who last month asked the FCC to investigate. He also has asked the Senate Commerce Committee, of which he is a member, to hold a hearing on the matter.

On Thursday, Kerry said, "I will review this deal to ensure it benefits consumers."

Asked whether the provision that gives cable a window to keep negotiating would satisfy federal scrutiny, DuPuy said, "Yes, we hope it will completely alleviate concerns in Washington."

Okay, this doesn't make any sense. Ignoring consumers for a second, what are DirecTV and MLB trying to get out of this? They conflict:

DirecTV- wants exclusive content to increase subscription revenue
MLB - wants cable and satellite to pay top dollar for their games

So does MLB really think that DirecTV will pay them more than all cable and satellite services combined would? MLB should want their content available in as many places as possible.

Another reason MLB shouldn't want DirecTV to be their only distribution channel is that they're shooting themselves in the foot in the long run. If every MLB fan willing to pay for Extra Innings switches to DirecTV, then in a few years DirecTV will have huge bargaining power over MLB. If MLB tries to renew this contract, but DirecTV has all the viewers, MLB's not gonna get anything because it'll have no alternative.

Okay, moving over to the consumer side, I need a clarification: does this replace games that are currently shown on local stations as well as FOX and ESPN? Or is it just that the Extra Innings package, previously available on all cable and satellite, is now only on DirecTV?

Your local games shouldn't be effected, nor would Fox or ESPN. I'd be shocked if that were the case.

This is mainly for people like me, who want to watch out of market games. I'll be getting the Extra Innings package this year again to watch the Cubbies, but I've already been a DirecTV subscriber. So I don't really care that they got the exclusive.

Unless they raise the price since they're the only provider.

Oh, I'm sure they will. They have raised the price every year on Sunday Ticket, which they also have the exclusive on. But right now they're trying to draw in new customers, so I doubt the price hike will come immediately.

Is Extra Innings a separate fee from the DirecTV subscription fee, or is it all together?

It's separate, but still on your regular bill. I can't remember what it was last year, but they bill you in increments. Like an extra $39.99 every month until it is paid off.

Here is the scoop:

Last year I paid DirecTV $179 for the year ($44.75 in four payments) for MLB Extra Innings. They might charge less this year for a thank you?

They are trying to get new people to sign up so they have a special on their web site for $159 per year (good until April 7, 2007). They said that $159 is discounted from their regular price for 2007 at $199 per year.

They have also added some second package called Super Fan for like $38 more per year…

Hahahahaha!!!

i am getting fucked right in the ass

It's okay, if they really do this exclusive, MLB will get their comeuppance when they renegotiate in seven years and DirecTV has all the power.

wow, that's going to make me feel a whole lot better. i have watched every sox game for the past 6 years, which i will no longer be able to do. that sucks.

You can't get DirecTV? Their satellites should cover the entire country...