EI Exclusive to D*?

[Greg Bimson]

Why would you call that a monopoly?

I didn't call it a monopoly.

You can get CBS through many sources, OTA, cable, satellite. ST is only available through 1 source, D*. Big difference there.

I can only get the Super Bowl through CBS. What if I want it from FOX?

Better explanation - NESN has exclusive rights to carry Red Sox games. But again, I can get NESN from Cable, Dish or Direct. Very different (And an overthrow of the Government would ensue) if Only Direct had NESN for instance in an exclusive deal.

You mean like say, if you were in Philadelphia, and could not get Comcast Sports Net over satellite? And say, when Comcast merges with another cable operator, conditions for "open access" are placed on the deal by the government, except for Comcast Sports Net Philadelphia? As just happened?

TERRIBLE analogy Greg.

Not really. There are exclusives everywhere. Even if no one wants to pay attention to them. CBS is the exclusive home of the NFL's championship for the 2007 season, Super Bowl XLI. The NFL has given CBS an exclusive. The NFL wants the Super Bowl on free TV, because they want as wide an audience as possible.

Sunday Ticket is on DirecTV because the NFL does not want as wide an audience as possible. The NFL also gets more money by making it an exclusive.

Imagine if the Super Bowl was on FOX, CBS and NBC this year. The networks nor the NFL would make as much money without making it an exclusive.

Now we roll back to Major League Baseball. MLB will get a 66 percent increase in their rights fees and will gain carriage of the MLB channel by 2009. The true baseball fan, the one that wants more than just the games they can get from their local stations, RSN's and cable networks, will need to switch to DirecTV in order to get the most baseball for their buck.

And if anyone believes Congress will take a look at this, I go right back to the fact that nothing has been done about Comcast Sports Net Philadelphia nor NFL Sunday Ticket.

 

[Mike McGann]

Actually, as I live in the Philadelphia DMA, I have two service options for Comcast Sport Net — Comcast and FIOS. And Comcast has used Sunday Ticket as the justification for keeping CSN-Philly off the dish.

And nothing whatsoever prevents me from signing up with either of those services, as long as I'm willing to pay. Keeping mind one other thing: Congress forced the NFL to show all local games on broadcast TV, when it is on ESPN or NFL-N, it must be offered to a local station in each of the two team's markets.

Unfortunately, no matter how much I'm willing to pay D* service isn't going to work at my house, which is the case for millions of people, a large number in cities, who are now pre-empted from seeing a sport that has a specific Anti-trust exemption.

Unlike the cited example of the Super Bowl, which I can watch OTA, via cable, FIOS or Sat. if I so chose, there is no option for EI or ST for millions of households in the U.S.

The original argument to support ST was that it would add subscribers — as it turns out there are about 2 million ST subs. Baseball, from all sources, has just 700,000 and the estimate is that as many as 1/3 will not be ABLE to get D* because of lack of access to a dish. D* had 250,000 EI subs. That's roughly 233,000 more D* subs in a best-case scenario (the realistic number is probably between 100,000 and 150,000). At $100 million per year, without allowing for marketing or infrastructure costs, D* loses about $27 million per year, unless the cost is spread out to all D* subs, as has been done with ST.

Because of the cost structure issue and the fact that satellite is always going to be limited by geographic issues, trees, mountains, buildings, etc. the overall satellite audience is going to be limited.

If DirecTV's management had any brains, they'd be looking into a secondary distribution system, something akin to IPTV. If MLB's management had any brains, they wouldn't be the last major sport to roll out a TV Network (2009? Are you kidding me?) and they wouldn't be running around poking Congress with a stick.

 

[JerryVolunteer]

People are getting bent out of shape for no reason. MLB decided to go with one place and D was the high bidder. Anyone could have bid. If you want EI you have to go with D. It's that simple. Dish has Voom channels and if I wanted those I would go to Dish but I could care less about them.

It's simple. If you like sports then D is far superior then Dish or cable.

 

[Greg Bimson]

Baseball, from all sources, has just 700,000 and the estimate is that as many as 1/3 will not be ABLE to get D* because of lack of access to a dish. D* had 250,000 EI subs. That's roughly 233,000 more D* subs in a best-case scenario (the realistic number is probably between 100,000 and 150,000). At $100 million per year, without allowing for marketing or infrastructure costs, D* loses about $27 million per year, unless the cost is spread out to all D* subs, as has been done with ST.

Yes, but you've forgotten something...

Average Revenue Per Subscriber (ARPU - U for unit) is above $60 a month for DirecTV. So if DirecTV is able to pick up those 233,000 subscribers to Extra innings, DirecTV will gain almost $14 million in revenue per month from the new subscribers, or over $160 million a year from those 233,000 subscribers.

So not for one minute do I believe the "cost is spread out to all D* subs". This is a fast, easy way to pick up high-end subscribers.

Unlike the cited example of the Super Bowl, which I can watch OTA, via cable, FIOS or Sat. if I so chose, there is no option for EI or ST for millions of households in the U.S.

But therein lies the issue. If the NFL gives CBS and only CBS Super Bowl XLI, does that mean CBS is a "monopoly"? Then if MLB gives DirecTV and only DirecTV Extra Innings, does that mean DirecTV is a "monopoly"? We get that word thrown around too much around here.

It is an "exclusive". And because just over half of one percent of all households in the US subscribe to Extra Innings, with no other way for MLB to start receiving more revenues from the package, they need to start limiting its distribution by making it exclusive.

Heck, NFL Sunday Ticket is only sold to less than two percent of all households in the US. And the NFL receives more money from DirecTV for that package than the NFL receives from either CBS, NBC or FOX separately.

 

[scotsmanron]

Average Revenue Per Subscriber (ARPU - U for unit) is above $60 a month for DirecTV. So if DirecTV is able to pick up those 233,000 subscribers to Extra innings, DirecTV will gain almost $14 million in revenue per month from the new subscribers, or over $160 million a year from those 233,000 subscribers.

But MLB doesn't give a rat's ass what D* makes, only what THEY make.

No one has still addressed the fact that customers that can't have D* now can't get EI.

Time to start writing politicians.

 

[jpn]

No one has still addressed the fact that customers that can't have D* now can't get EI.

ST strictly carries out-of-market games; local teams are blacked-out. Therefore Lack of ST does not block anyone from seeing the games of the team(s) within their DMA.

Like ST, EI is an out-of-market package; local teams are blacked-out. Not having EI does not prevent anyone from seeing their local team.

Out-of-market fans have no claim to games played by teams residing out of their DMA. That's why you can't get games directly from the RSN channels on your sports-pack.

The blackout restrictions have to be lifted before anyone can logically and rationally claim that EI and ST should be universally-available.

 

[phonecarhead]

Does anyone know if this is official yet?

 

[Peter Parker]

Interestingly there is no announcement yet. That may mean that they have hit a snag, it may mean ironing out details, or they could be waiting for the appropriate date to make the announcement.

 

[billybill]

It seems as though the people voicing their displeasure about this are directing it towards Directv. The complaints should be directed to the greedy folks at MLB. I am a Directv & EI subscriber but I think this is a ridiculous and shortsighted deal by MLB to make the quick, easy buck at the expense of both current and future fans.

Yes it is a great deal for Directv. Having something that is exclusive is great for them. You can argue the dollars and cents but unless we are inside their boardroom I think we are all just making educated guesses as to the botom line impact of the deal.

 

[GadgetGirl]

My anger is at MLB for allowing this to be an exclusive package. I don't think it helps baseball in the long run. They should be reaching out and trying to build on their fan base. I am a big enough fan of an out of market team than I am actually making the switch to D* but I am not happy about it. It has been a tough choice to make as I have a lot of money invested in my E* equipment. At least I am fortunate that I actually have a choice. Many aren't able to get D* at all.

 

[satjay]

So...This deal is not set in stone yet

 

[jpn]

So...This deal is not set in stone yet

As it stands today, there is only rumor. However, no cable or satellite service has pricing available for EI 2007.

 

[rmmrph]

Hmm, convincing my wife to switch to Fios once it is available just got a little tougher, if this turns out to be true.

Keep in mind MLB does not care if D* has 3 subscribers to EI or 300,000. They get their money either way. Reminds of Goodfellas. "Fell on hard times, too bad F_U_. Pay me."

 

[billybill]

As it stands today, there is only rumor. However, no cable or satellite service has pricing available for EI 2007.

And MLB does not have pricing for the upcoming season of MLB.Tv on their website either. If I remember correcty it was about $89 last season.

 

[lou_do]

And MLB does not have pricing for the upcoming season of MLB.Tv on their website either. If I remember correcty it was about $89 last season.

Maybe it will be discontinued if D* get sole rights for IE.

 

[wneilson82]

Maybe it will be discontinued if D* get sole rights for IE.

MLB is keeping their Internet stuff even with the D* deal.

 

[DetFan]

I've had EI for the past 2 years. I've enjoyed it. At first, I thought I wouldn't watch alot of the games, but what I've found out is that I'll tune in based upon a pitching matchup or just because I want to see a particular team or player that night.

With that said...

--The Milwaukee Brewers announcers keep the game light-hearted. It always seems like the Brewer's fans are taking in some type of promotion

--Vin Scully, the "VOICE" of the Dodgers is incredible to listen to. He paints a picture and give backgrounds information so seemlessly. He is a gem not to be missed.

--Rivalries. Its nice to see what your division foes are doing. Being in Detroit, and finally having something to cheer for last year, it was fun to watch White Sox and Twins games to see how the competition was faring.

--The Watch a Few Innings Factor. I find with EI, I'll watch a few innings of several games as opposed to a whole game.

I have the NFL ST, MLB EI and NHL CI. I doubt I'll renew NHL CI next season. I love my Red Wings and to be honest, am to the point, they are all I want to watch. The NFL ST is always welcome in my home. I just wish the cost wouldn't keep spiriling up.

Im with you on this one, I wont be renewing CI, or League pass next season for that matter. St, and EI, OH Yea, I cannot get enough of them. Betman has killed the NHL, with he stupid rules, and still no national contract. Te schedule is a damn mess. I can get enough by just watching the wings.

THe nba has gotten as bad with all the no touch fouls. I cant stand watching what used to be a beautiful game...

 

[cohenri]

I am a direct TV subscriber and I will probably continue to get the baseball package along with the basketball package and the football package. However, anyone that think that this deal is beneficial for them other than Direct TV employees must be smokin' some strong hashish.

If there is only one source providing the package, there are less limits on the amount that can be charged for the package. There is also less incentive to get more games on HD any quicker. Plus with the huge exclusive rights deal, Direct TV will likely choose to raise their prices to recoup their costs.

Whether it is right or legal is an entirely different question. Congress could definitely write a law to outlaw these types of exclusive rights deals. if they wrote such a law, it would become illegal. Perhaps anyone here that is complaining should write their congressman and try and get a law that restricts such deals.

By the way Greg, monopoly laws are not concerned with exclusive rights. As you correctly pointed out, CBS has exclusive rights to broadcast the Super Bowl. Similarly, all patents and copyrights give the holder an exclusive right to sell a product. So, it is clear that the law is not looking to restrict all exclusive rights, it actually encourages many (most?) exclusive rights. However, it is possible that the law could be interpreted to include the exclusive distribution rights of these packages.

Nevertheless, I would recommend a new narrowly tailored law that addresses this issue if someone chooses to go after these exclusive deals. I guess it is possible that Congress or the Courts could hold the anti-trust exemption over the heads of MLB in trying to prevent them from entering into such an exclusive agreement. However, I would guess that that would be unlikely.