Wednesday, November 15, 2006

Cable Companies -2.5 NFL Network

Next Thursday the NFL will offer up its traditional Thanksgiving games. The Detroit Lions have played every Thanksgiving since 1934 (except for the 1939-44 commercial break otherwise known as "World War II"), and the Dallas Cowboys made it a doubleheader starting in 1966. Does anybody reading this remember a Thanksgiving without exactly two NFL games?

So imagine my surprise when I learned that, starting this year, a third Thanksgiving game will be played. This year's night game will feature the Chiefs and Broncos. Thing is, you can't watch that contest unless your cable provider allows you to subscribe to the NFL Network. I should know: I live in the metro-New York area, where the two cable companies, Time Warner and Cablevision, don't make the channel available at any price. The battle's been brewing since July, when the NFL held the Thursday night package back from network bidders, leaving big bucks on the table in order to televise the games on its own cable channel.

The gist of the fight is as follows: Cable companies argue that the NFL Network is trying to gouge them with per-subscriber rates of 70 cents each, up from the channel's current price of about a quarter. The NFL Network responds that it has the country's most-watched programming, so the cable companies should pony up. For comparison's sake, ESPN is the most expensive channel for cable companies to provide, at nearly $3 per subsriber. As the parties head back to the bargaining table for one last week of negotiations, let's handicap this matchup.

Home Field Advantage

The game's to be played on the cable companies' turf because they own the infrastructure necessary to bring programming to your home. If everyone's home had an "unobstructed view of the Southern sky," we'd all have already switched to DirecTV to buy the Sunday Ticket package. As it stands, if you want sports programming, you pay for cable (and probably digital cable so you get the HD feed). It's the only way. Advantage: Cable companies. As we know, home field in the NFL is worth 3 points.

Talent

CBS and Fox paid $8 billion to broadcast the NFL through 2011 because pro football games are the most consistent ratings-generators in the television business (crappy MNF games like Panthers-Bucs or Seahawks-Raiders notwithstanding). The NFL Network knows it has a tremendous product, so it can realistically ask for high subscriber fees. However, cable companies don't want to pay (70 cents) * (all their subscribers) for a network most people wouldn't watch and that, oh yeah, happens to have a measly eight NFL games during only two months of the year. That's a solid argument. Slight advantage: Cable companies. This moves the line another point and a half.

Coaching

The cable companies have been fighting this battle for years. You might remember the fight over the Yankees' YES Network or the fight over the Mets' SportsNet New York. They've got a gameplan: They offer to put the channel on a special "sports tier" of programming for which subscribers may pay extra if they choose. This way the people who subscribe to cable for the Food Network or MTV or HBO don't have to pay extra for sports they're not going to watch. On the other side of the boardroom is Steve Bornstein. He used to run ESPN, so he knows how important sports are to people like you and me. He'll use the time-tested strategy pioneered by George Steinbrenner and the YES lawyers - people really care about watching this stuff, so you better give it to them. That tactic works if viewers can't see 90% of a team's games over six months of a baseball season, but I'm not sure it'll work for a random slate of eight NFL games. Slight advantage: Cable companies. The line moves one more point.

The Mob

I'm not referring to the Gambino crime family or point-shaving, though the pun was intended. I mean the dirty, unwashed public, otherwise known as the millions of television viewers who pay the subscriber fees keeping cable companies in business. The great unknown is how much of a stink people like us will make. When Cablevision refused to carry the Mets' regional network, SNY, so many Mets fans complained that New York Mayor Michael Bloomberg inserted himself into the negotiation and the parties eventually reached a compromise. There's precedent for public opinion working hard against the cable companies, especially since each cable company is a monopoly in its viewing area. Advantage: NFL Network, but it's not the lock that you had with local baseball teams. My guess is that there's enough football on free tv and ESPN this time of year that those eight NFL games might not be missed. Move the line three points the other way.


Check my math, but totaling the above puts the cable companies as 2.5-point favorites going into this last week. I think you'll get the chance to watch the NFL Network games, but you'll probably have to pay for the special sports tier. Hell, Cablevision doesn't even offer ESPN2-HD on basic digital cable, so I don't see Cablevision handing the NFL Network a coveted basic cable spot. At least the NFL can rest assured that they can keep running their float in the Macy's Thanksgiving Day Parade.

13 comments:

Anonymous said...

Sorry. The three points for the mob is waaaaay to generous. As a new yorker, I don't give a rats ass about missing the Denver game, even if it would a bonus to see it. The cable companies are right here. The NFL network would need to have 25% the programming to demand almost a quarter of the price of ESPN. $.25 seems really fair.

Anonymous said...

I'd love to respond to the previous post, but I stopped reading when I got to "As a new yorker..." My uncle bought a Chrysler New Yorker and that thing sucked too (too, not "to", douche). The NFL is the guilty party here, naturally it is Joe Fan that gets shafted once again, but it will all shake out, money will change hands and we will live to gorge ourselves from the sweet teat of the pigskin ad infinitum.

Quality said...

Yeah, Jerry Jones (Cowboys owner) said the NFL would be willing to lose money for a few years to get the NFL Network up and running. I just wish somebody out there in government-land would deregulate the cable industry so we lowly consumers can buy a-la-carte channels or at least the proposed-but-never-executed sports tiers.

Anonymous said...

Anonymous #2. Sorry, Here's your "O" . Or is it TOO big for you. It's a shame I completely agree with you. I may make a typo here or there, but You're the dick here.

By the way, your last sentence is a run on and you are missing a comma.

karl said...

OK
I am in NJ, with NYC channels, and I have a clear picture of the southwestern sky. I apologize to you who do not have it. DirecTV is the best purchase I have ever made. (don't tell my wife). Watching the Packers win or lose is better than the NYC football choice I have. (Jets or Giants every week). If you have a chance, get rid of Cablevision and get DirecTV.

Anonymous said...

while your at it Time Warner, please add ESPN2 sometime this decade.

Anonymous said...

oops! ESPN2 HD is what i meant.

Quality said...

Regular TV (as opposed to HDTV) looks awful on most flat-panels. Most of the time I watch sports in HD, but occassionally ESPN will have some college basketball (yecch, until February), so I watch college football on ESPN2. I'm frustrated Cablevision gave us TNT-HD before ESPN2-HD.

Anonymous said...

TNT-HD has shown Nascar. Nascar > anything else. If the choice was ESPN2-HD vs. TNT-HD, well, they made the right choice.

mike said...

karl:

did you purchase your wife?

Ed Valentine said...

The NFL is trying to be the big bully here, and will only hurt itself. A compromise will eventually be reached, and I think the end price will be closer to what the cable companies want.

Mel Ott said...

I'm with John McCain, we need to buy the cable channels "a la carte."

Mark said...

Instead of complaining about not having the NFL Network we should take action! There have been less expensive alternatives to cable for years and they include NFL Network. If we are not willing to change, the cable companies will keep sticking it to us! Go to thriftytimes.com/nfl for an alternative.