This article was originally published on PaidContent.org on November 17, 2004.
I recently attended the 6th Annual Sports Media & Technology conference. The folks at Street & Smith’s Sports Business Journal do a fabulous job organizing and presenting this conference, and I’ll blog some of the more interesting panel presentations here.
There was a lively panel discussion Tuesday morning on the topic of “Cable Programming and Distribution Issues that Affect the Way We View Sports” (who comes up with these titles, anyway?).
— Fred Dressler, EVP for Programming at Time Warner Cable said he sees escalating rights fees for sports programming as the biggest issue within the industry, particularly in light of recent news about NFL rights fees for television (“NFL agrees to six-year extensions with Fox and CBS worth $8 billion“). “It is fascinating to me to read how FOX concedes that it lost money on the last NFL deal,” Dressler said. “But it says it is going to make money on this one when it increased its cost by over 30 percent.”
Escalating rights fees are certainly good if you’re a sports league and can find a willing buyer. But is this sustainable?
— David Meister, Chairman & CEO of The Tennis Channel (a 24-hour cable television network devoted to tennis) said that sports tiers on cable today don’t reflect what’s driven cable TV in the past: namely, the value proposition of broad consumer choice. Meister says that with tiers today, the consumer ends up paying 2-3 times more, which he described as a flawed value proposition.
There is reason to believe Meister is correct, but some consumers must wonder is it fair for MSO’s to pass along escalating rights fees for sports programming to all subscribers, especially to the majority who dont watch sports programming?
In my next report, I’ll cover “Set-Top Boxes and The Future of Interactive Television”.