Scott's View and YOURS on the MLB Deal

[Scott Greczkowski]

And dont forget (insert sports network here) HD too.

 

[rad]

On the outside it looks like it is possible but when you get to the details, it will be impossible for the asking price.

Why, when you factor in all the cable customers out there vs. D* customers they have a MUCH large base to work from to generate revenue. InDemand must have looked at the numbers and said to them it didn't make financial sense and passed, but it they wanted to take the same chance that D* decided on they could have ponied up the dollars.

Will this deal be a loss leaded for D*, probably, but they decided to roll the dice and take a chance on it, the other folded. Is MLB being greedy, you bet, but can you really blame them for taking the money and running, hell the owners are all probably sitting around tonight drinking champange and smoking their big cigars having a good laugh that someone actually agreed to pay that much money. But that's their job, fill their pockets and to hell with their customers.

 

[Sean Mota]

That's why the NY Yankees are no longer the "Evil Empire" DirecTv is Monopolistic to the end... can they call the cable companies monopolistic anymore?

 

[rad]

Um ok, they honestly dont expect them to match it, its a 4x price increase so who pays that price?

The consumers.

How is that Fan Friendly?

No matter how you slice it or dice it the consumer gets screwed in the end.

Sure DirecTV may only raise the price of the package by $10 this year, but what about next year or the 5 years in front of that.

Fan friendly, nope, consumer gets screwed, yep. So what else is new? How many companies have done something lately that was beneficial to the consumer vs. increasing their corporate profits?

 

[csschrot]

Let Direct have it. They promise all this money to NFL and MLB and who ever else. Once they realize that they are losing lots of money on the deal they will just do more price increases to all their customers. Not just the ones getting NFL ST and MLB EI.

I'm happy with what I have and I doubt DISH will lose any sleep over this. Like others say, invest that money in other areas. That is the smarter thing to do.

 

[shodobe]

I am wondering what the deal is about carrying the MLB Network on a tier? What is a tier and why is it so important to carry this channel on it. Reading the article on yahoo it seems this is the only sticking place and not necessarily more money. Why would anyone in thier right mind give MLB 2.1 Billion over 7 years! So am I wrong and it is about more money or the most carry on a certain tier.

 

[cebbigh]

I think what DTV and MLB have done is extortion. You hit the nail right on the head Scott. And I agree with everyone else who say use the money for better purposes. Get the RSN's in HD now! And also do the YES network. It's just stupid not to.

And eliminate the antitrust exemption. Doesn't matter if they back down from the DTV deal or not. Hammer the greedy b**tards.

 

[Clancy]

Scott, using your numbers in the opening post, Dish will be wise to allow Direct to foolishly pay that exorbitant amount for Extra Innings, unopposed.
It will be just another nail in Direct's coffin just as Sunday Ticket has been.
History has shown that CFO's have buried companies and this is another example in my opinion.
What is gained in the few new subs. will undoubtedly not cover these projected costs.
If people do a little research, they will see that Extra Innings can be had from Canada at a much lower cost than what Direct will probably be charging. Hmm.

 

[bgilga]

The way I understand this deal, each company would not pay $100 million. MLB gets $100 million, period. If Directv is the only provider on board they pay the whole amount. If Dish gets in they split it 50-50. If InDemand gets in they split it 3 ways or $33 million each. If tha latter happens Dish would only pay 5 million more than last year, not 4x more. The only catch is Dish and InDemand has to carry the new MLB channel. I do not think it is that big of a deal. I was just notified I will be paying $160 for the year. Not a big increase over last year. The NBA gets $200 for the year, so this isn't that bad.

 

[cosmo_kramer]

According to my calculations, if D* was to go it alone at $100M, and at $160 per subscriber, they would need 625,000 subs just to break even. (I'm sure it's not that simple though). What's the figure on the count of MLB EI's total subs the past couple of years from all providers??

 

[jpn]

Lets see if I got this correct... (The below is my OPINION)

Last year Dish paid $28 million for the MLB package (these numbers are from memory) and now DirecTV has this new deal reported to be at $700 million, which is for 7 years, so that $100 million a year.

Now MLB has said Dish and Cable can have the Extra Innings package if the match DirecTV's deal.

That's not what it says. According to SkyReport today:
they must agree to "match the same rate structure and carriage requirements" of the announced deal.

Now pick it apart.
1) Rate structure does not necessarily mean paying the same as last year, or paying the same $700M for seven years. D* is the distributor; they're paying MLB for rights to resell, but they also probably have an internal rate that they charge themselves, and that's how they determine "rate structure". Let's face it, when challenged they have to document their rate structure somehow. Most likely it means a per-game shown rate that matches what they charge themselves. Dish and cable will have to agree to that rate.

2) carriage requirements. IMO, this is the meat of the stipulation, not the rate structure. This part is how D* will gain rights to Phillies games from Comcast. It's also how E* will have to sign-up for whatever RSN's they don't carry. Because if E* isn't able to show the games, then they will have failed the carriage requirements, nixing the deal.

I don't see how the carriage requirement hurts anybody. If you subscribe to E* you're going to get new RSN's now and MLB channel later; if you're cable the same applies. If you're D*, you're nailing-down Comcast SportsNet and resolving that ugly dispute.

......
Business costs are business costs, and they always get passed-on to the consumer. The D* subscriber is going to get the privilege of subsidizing his share of the deal, just like everybody else.

As of today, there are 2+ weeks for Dish and cable to negotiate before a single EI game is shown. There are no rates published, even for D* subscribers. There is nothing written showing how any individual will be denied a single game, or discriminated-against based on his provider.

Until a rate structure and subscription rates are published, nobody can claim they're being bent-over and screwed. Bitching now is pretty silly, childish, and uninformed.

How about we tame the paranoia, toss-out the call-your-congressman crap, until there is something concrete to bitch about.

 

[Scott Greczkowski]

How about we tame the paranoia, toss-out the call-your-congressman crap, until there is something concrete to bitch about.

If we just sat around sitting on our hands the season will have started and then we will be kicking ourself for not doing anything why we could.

If we just shut up the only folks who would be happy are MLB and DirecTV. Remember it's the squeeky wheels that get the grease.

 

[vurbano]

So what does MLB want ?? 700 millon from each?? why can't Cable,Dish,DTV split the 700 millon & call this BS a DAY !

because directv having it exclusive gives them a competitive advantage and that is what business is about. Unfortunately that is the world we live in. It is reality just like Sunday Ticket. Its also a warning against signing contracts and not to pay large sums of money for equipment for any provider.

 

[ScoBuck]

According to my calculations, if D* was to go it alone at $100M, and at $160 per subscriber, they would need 625,000 subs just to break even. (I'm sure it's not that simple though). What's the figure on the count of MLB EI's total subs the past couple of years from all providers??

Not exactly true, because they would collect revenue from other sources. First, you have to believe that they expect to add subs who want the package and thus they get increased MONTHLY revenue in addition to the EI revenue. Next, they get ad revenue, they also will be a part (minority) owner in the new MLB channel - thus, they collect from other sources also.

I keep reading in this thread how D* loses money on the NFL package. Just in case you missed the Bear Stearns D* analyst call this week - Chase Carey confirmed that DirecTV has 1.8 MILLION subs to NFL (and includes commerical establishments that pay BIG money). At the price last year (w/o SF) that brings them in OVER $400 million annually(and more than likely over $500m). It also attracts customers to them, and is a big part of their ability to RETAIN subs. Anyone really think they are losing money on this?

 

[ScoBuck]

because directv having it exclusive gives them a competitive advantage and that is what business is about. Unfortunately that is the world we live in. It is reality just like Sunday Ticket. Its also a warning against signing contracts and not to pay large sums of money for equipment for any provider.

But........as we see in reality. As DirecTV (and others lay out this kind of money) they REQUIRE more committment from subs. If you want it, you have to sign on the dotted line. Take it or leave it is the name of the game. And I guess it DOES make sense, if you are going to make that kind of investment, you would want to lock in your revenue any way you could.

 

[Sean Mota]

Robert Jacobson, In Demand's president/CEO, said MLB and DirecTV have cut a "de facto exclusive deal" that includes conditions designed "to be impossible for cable and Dish Network to meet."

http://www.nydailynews.com/sports/baseball/story/503738p-424851c.html

Jacobson said the deal contained "conditions for carriage that MLB and DirecTV designed to be impossible for cable and DISH to meet." He said the agreement will "disenfranchise baseball fans in the 75 million multichannel households who do not subscribe to DirecTV" and "represents the height of disrespect and disregard for their loyal baseball fans."

http://sports.espn.go.com/mlb/news/story?id=2792214

Dish Network assailed the new agreement. "When our customers are suddenly cut off from watching their favorite sports teams on TV," the company said in a statement, "it is time to ask whether the market is working. This is both anti-competitive and anti-consumer."

http://sportsillustrated.cnn.com/2007/writers/john_donovan/03/08/directtv/index.html

 

[Neutron]

First the MLB Owners are foolish with the extraordinary costs of players contracts, and now this. They didn't learn anything from the strike of '94.

 

[caseyatbt]

I just susbscribed to pay the 6 bucks to get all the rsn's besides my local (FSNNW).

Are you saying that there is a way to subscribe to all the regional Fox Sports Networks? I didn't know that was possible.
If so, that would be almost like getting the EI package.

 

[teachsac]

I just susbscribed to pay the 6 bucks to get all the rsn's besides my local (FSNNW). There are lots and lots of preseason baseball games that I just set up to record on my 622. I think when the season arrives there will be more games to record than I can possibly want.

Right now they may not be blacked out, but come regular season time I bet they are. Let us know if they're not.

S~

 

[RandallA]

Right now they may not be blacked out, but come regular season time I bet they are. Let us know if they're not.

S~

Yes, they are blacked out during the regular season. All Pro Sports games are blacked out.