That would be DirecTV subscribers who still can't receive Time Warner Cable's SportsNet channel because the satellite company and the cable company haven't come to terms on a distribution deal. Time Warner is leveraging its TV rights contract with fee demands that DirecTV refuses to pay. Actually, both sides have pretty good arguments: Time Warner is shelling out lots of money to carry the Lakers and wants a decent return, while DirecTV is trying to rein in programming costs. From this week's Business Update on KPCC:
Lacter: DirecTV is not only worried about what it has to pay for the Lakers, which is pricey enough, but also what it might cost to carry the Dodgers once team owners decide on a new TV deal. The CEO of DirectTV says that programming costs, especially sports programming, have gotten way out of hand. He obviously doesn't want to lose Laker fans, but he also doesn't want to alienate the rest of his customer base by raising prices.
Steve Julian: My mom, who grew up walking distance from the Coliseum and watched every Rams and Trojans game in person, now can't watch her beloved USC football games for the same reason. She can't get the PAC 12 channel. She's in her 70s, and THAT's driving her crazy. This is more than just a Lakers issue.
Lacter: That's right, the new Pac 12 Network isn't available on all cable and satellite systems. You know, the TV market has become so fragmented that live sports is one of the few reliable sources of programming. And what we're seeing in the L.A. market Steve is the growth of regional sports channels. So far, you have Fox Sports, Prime Ticket, the Time Warner SportsNet Channel, and the Pac 12 channel. That adds up to almost $10 per subscriber per month that the cable and satellite services have to pay, according to Sports Business Journal. But it does not include the upcoming TV rights deal for the Dodgers, which is certain to be huge - whether the team decides to start its own TV channel (as the Yankees did), or possibly work out a deal with Fox or Time Warner.
Julian: Do cable companies work well as content providers?
Lacter: Usually not - that's a big part of the problem. And eventually, all roads lead back to the sports franchises themselves. The Lakers not only asked for a multi-billion-dollar deal, but wound up giving exclusive rights to a single cable service - Time Warner - that then would be free to charge its competitors whatever it wanted. It was kind of asking for trouble, which is what they have with the DirecTV situation.