Regional Sports Channels Highlight Problem With Comcast/TWC Merger

For Dodgers fans in L.A. without Time Warner Cable, going to see a game live may the only way to catch a game. (photo: Atwater Village Newbie)

When Connecticut Senator Richard Blumenthal questioned Comcast and Time Warner Cable execs about how the merger of these companies would impact regional sports programming, the two cable operators shrugged it off as a silly question. But it’s not, and here’s why.

In their testimony before the Senators, Comcast and TWC said there should be no concern about the merger affecting regional sports channels because Comcast and TWC don’t currently have any overlap with these channels.

But this isn’t about overlap. It’s about using the combined assets of Comcast and TWC to force customers off of the only real remaining competition in the pay-TV market: Satellite service from DirecTV and Dish.

The two biggest players in regional sports coverage are Comcast, through its various Comcast SportsNet offerings, and FOX, which operates a large number of local sports channels. In markets with multiple sports teams, these regional channels often carry the majority of games for everything except the NFL, which is usually available through a local broadcast TV station.

But where FOX’s sports offerings and those of Comcast differ is availability to people across multiple pay-TV platforms. See, FOX, being a content company that wants its shows seen by as many people possible, tries to make deals with as many cable and satellite providers as possible. And across the entire list of local FOX Sports stations, only a handful are not available to both DirecTV and Dish subscribers in their area. In all of its markets, FOX has at least made deals with DirecTV, in addition to the terrestrial cable operators.

That’s not true for Comcast, which balks at offering satellite providers access to some of its most coveted sports offerings out of concern that it will lose its stranglehold on the local pay-TV business.

THE PHILADELPHIA EXPERIMENT

We’ve written before about the mess here in Philadelphia, where Comcast successfully held a death grip on its local sports network through the “terrestrial loophole,” an antiquated aspect of FCC regulations that said a cable operator didn’t need to share its privately owned stations with others in the area if those stations only went out via terrestrial cables. The FCC closed that loophole several years ago, but CSN Philadelphia is still not available to companies that compete with Comcast in the area.

Sources at some of those competitors tell Consumerist it’s because Comcast is demanding an “extortionate” rate — something along the lines of what a cable company would pay to broadcast a major network nationwide — just to air Phillies, Flyers, and Sixers games to customers in the Philadelphia market.

Making matters even worse for those with satellite service, Comcast recently made a deal with the Phillies that ensures that all but around 10 of the team’s 162 games will be broadcast on Comcast-owned stations that are not available to DirecTV or Dish customers.

If you need more concrete evidence that Comcast would rather tick off satellite companies than score higher ratings, you need look no further than the current NHL playoffs.

NBC is touting that all playoff hockey games will be available on some NBC channel this season, and one of last week’s games between the Flyers and the NY Rangers was slated to appear on CNBC, a station that all DirecTV and Dish subscribers have. But here in Philadelphia, the game was also aired on CSN Philadelphia, which triggered NHL blackout rules, meaning that satellite customers in the area were left staring at a blank screen.

There is absolutely no other reason for Comcast to simulcast this game on the smaller regional sports station other than to make sure it remains blacked out for Dish and DirecTV subscribers in the area.

So rather than make sure that as many people could see the game as possible, generating more revenue and earning much-needed goodwill, Comcast chose to raise a middle finger to Philadelphia-area residents who dared to not subscribe to Comcast.

The same will likely hold true for tonight’s game, which is available nationally on NBC Sports network, but which will presumably be blacked out for DirecTV and Dish users in the area because it’s also being shown on CSN Philly.

HOUSTON, WE HAVE A PROBLEM

There is a similar issue going on in Houston, where CSN Houston carries the majority of Rockets and Astros games, but which only about 2-in-5 Houstonians have access to.

In spite of sinking ratings because of lack of availability, Comcast has yet to reach a deal with either DirecTV or Dish (or U-Verse and other terrestrial providers in the area), leading Houston Mayor Annise Parker to try to bring all the interested parties together to hopefully come to a resolution.

TIME WARNER CABLE: THE UN-ARTFUL DODGER

Comcast’s merger partner is trying to mimic its bigger pal’s tough-guy monopolistic stance with SportsNet L.A., jointly owned by the Dodgers and TWC.

Because TWC is unwilling to budge on the price tag for access to the Dodgers — who currently have the leverage of doing well so far this season — some 70% of people in L.A. have no way of watching most Dodgers game.

And much like in Houston, it’s come to the point of mayoral intervention, with Mayor Eric Garcetti (not to be confused with fictional Baltimore politician Tommy Carcetti) recently pleading with TWC to stop being jerks and make a dang deal already.

IT ONLY GETS WORSE

A merger between Comcast and Time Warner Cable only gives the combined company more leverage in negotiating with local sports teams — this is especially true with the proposed deal with Charter that would give a merged Comcast/TWC more contiguous coverage in L.A. and much of the East Coast.

In NYC, the Mets games are shown on SNY, which is jointly owned by the team, TWC and Comcast. Combined, the cable companies would own one-third of the station. The station is already unavailable to Dish customers in the city. What’s to stop Comcast — especially when it becomes the dominant cable and broadband provider in NYC — to use that ownership stake to raise the price charged to DirecTV, forcing the satellite company to pass the cost on or drop the station?

In L.A., Comcast’s adding of the few areas of the city currently held by Charter would bring Dodgers games to more people, but would also mean that the company has less reason to share with DirecTV or Dish, since not as many Angelinos would be up in arms about being unable to watch the games.

Comcast has never done anything to show that it has any interest in making sports content available to a wider market. Even its online Olympics coverage was only available to pay-TV subscribers willing to pay for service tiers that included every NBC news and sports channel.

A bigger Comcast with more money behind it will only continue to leverage exclusive regional sports deals in order to keep subscribers from cutting the cord and to convince sports fans to stay away from satellite.

by Chris Morran via Consumerist